Owning a home can be extremely expensive and an endless bill that you sometimes can feel like you can’t get ahead of.
Expenses of owning a home go far beyond just your mortgage payments, and you likely don’t need us to tell you that. Whether it’s hydro and water bills, general day-to-day maintenance, or anything else that goes along with owning a home, saving money can seem impossible. But we’re here to tell you that it isn’t, and there are ways you can be saving cash on your home expenses on a daily basis that you may not even know about.
How to save money as a new home owner
When you buy your first home, or a new home, it can be incredibly exciting. However, it’s one of the biggest life purchases you may make. As a new home owner, how and where can you save money?
It’s hard to not stress about your finances at a time like buying a new home, or making any large purchase, and even though online loans like ours are available, you want to ensure you aren’t digging yourself too deep in borrowing money. Here are some tips that can help you save.
Create a new budget
Since buying a house is a large expense, there are many financial implications that come along with it. So the first thing you need to do is reevaluate your budget. Likely your budget you had before is going to change. There are usually other expenses that are involved in your new budget that you’ll want to take into consideration, such as:
- What your mortgage payment is
- If you borrowed money to buy your home, what’s the payback plan
- Warranties and insurance for new purchases within your home
- Interest on money you borrowed
- New basic living expenses like water bills, hydro, maintenance fees, etc.
Taking a hard look at your budget and adding in all the items you may have never had to think about before, on top of your regular expenses you’ve always had to pay like groceries or your phone bill, will really help you level set your new lifestyle and ensure you don’t go too overboard, unable to make ends meet.
Make the place your own
There is no doubt that when you buy a new home you want to make it feel like your own, whether that’s through renovations, or decor. It’s easy to know what you want, but not know a) how much you have to spend on those wants, or b) how much those wants actually cost.
This is where research needs to come in. Before you commit to anything, you want to ensure you look at all your options. Ask yourself:
- How long will these upgrades take? Are there shorter/cheaper projects I can do right away, and larger ones I can save for down the line?
- What are small upgrades that can be done until I have money for those larger ones I want to do?
- Are there cheaper ways to source decor, furniture, etc. for my new home? Like Facebook Marketplace, Kijiji, or friends hand-me-downs?
- For the renovations we need to do, have I received at least three different quotes for the project to ensure we’re getting the best cost?
- Can I shop around for the right deals when it comes to furniture or do I need it immediately?
Be proactive vs. reactive
When it comes to upkeep and maintenance of your home, it is better to be on top of things when you first notice them instead of waiting until things get worse.
Is the washing machine making a funny noise?
Is the drain in the bathroom not draining well?
Are you worried about a flood in your basement after a storm?
Since these things that may not seem like a huge deal can go downhill quick, and when you least expect it, it’s key to keep on top of maintenance. For example, by calling in someone to look at your washer, you may realize your issue is a small (and cheap) fix. However, by calling them in once your washer has already broken, they may tell you that you should’ve called sooner because now it’s too late and you have to buy a whole new machine.
Small maintenance issues that are ignored can turn into much larger, expensive, projects, which can be extremely hard to forecast for in your budget.
Get comfortable first
You may move into your new place with a laundry list of tasks and renovations you want to complete. You might already have a long list of furniture you want to buy, and paint swabs already chosen. This is normal. However, before you jump ahead, you should ask yourself what needs to be done now and what can wait. Do you need that new deck built even though summer is already over for this year? Do you need to re-do your master bathroom, or is it bearable for now?
The thing about waiting and allowing yourself to actually live in your home is that you may realize that you actually like aspects of the home you didn’t think you would in the beginning. Giving yourself some time to get comfortable with your new budget and expenses can also give you a better forecast of what’s do-able, and what projects will need to wait until you’ve saved more.
Getting a home means you’ve been approved for a mortgage, and to get a mortgage there are some things like having homeowners insurance that are required. This insurance isn’t something you should think about eventually getting. It is a necessity. Why? Because it protects your home and possessions against damage or theft, but banks and mortgage companies require it because they won’t give you a loan to finance real estate without proof of it.
But home insurance isn’t where it ends. Do you share your home with anyone who relies on your income to help pay the mortgage? Whether a significant other, or child? You’ll need life insurance with that person named as a beneficiary so they won’t lose the house if you die unexpectedly. This can get complicated, and Investopoedia gives you a great guide with everything you should be considering with your new home.
Get your taxes in order
When you purchase a new home, you need to pay attention to a few more lines on your taxes. Even though you may not normally use an accountant to submit your taxes, it may be a good idea to hire more for the first year in your home so you don’t file them incorrectly, or miss claiming something that could get you cash back. Don’t forget if you’re Canadian to also cash in on the benefits available for first time home buyers.
What are the surprised costs of home renovations?
Home renovations can cost you an arm and a leg, but they can also bring forward a lot of (expensive) surprises that you may have not been prepared for. Here are some things you should be keeping in mind while renovating, and also some tips to help save you money while renovating.
It’s not always what you see on TV
There are so many home renovation shows out there that give us all the inspo we could ask for. However, these shows provide people with a false idea of how long renovations can actually take by completely transforming a house in one episode. This is obviously not realistic, and you don’t always see all the team and contractors involved to make this happen. So when it comes to attempting your own home renos, you must assess your own skills and what you’re capable of doing yourself. In reality, home renos are a lot of work and they involve professionals to ensure you don’t create more harm than good.
Renovations aren’t a DIY project
Pinterest has inspired us and made it feel like every project is a DIY project. However, when it comes to renovations, they are not the time to experiment with your latest tools or ideas. DIY projects aren’t always as manageable and affordable like they show on TV (or Pinterest). Home renos take a lot of work and involve project assessment in order to determine the right course of action during the project. Not only that, but something could go wrong along the way and without proper experience with these types of projects, you may not know how to fix it, and hiring a professional half way through may end up costing you more. Homeowners often don’t have the knowledge to manage a home renovation the same way a contractor or expert does, so even if the price tag seems tempting, don’t underestimate the value of hiring a pro.
Plan your timing and spending accordingly
Renovations will take time to complete, and in order to make a realistic budget, you’re going to need to do your research before committing to a number. As much as we wish renovations can be completed quickly and all at once, the reality is that you need time to plan and forecast your budget. Draw up a timeline with you contractor to give yourself a better idea of what you can expect, and when you can expect to have to hand over payments. This can help you forecast what renos are do-able and when. You don’t want to end up starting renovations without planning only to have to pause them halfway done because of budget constraints.
Planning, budgeting, and timing is everything when it comes to renovating your home and the constant, non-stop projects that come along with a house. If you have these things in mind, you’ll set yourself off on a better, and more prepared foot to build your dream house without going into debt.
What are your biggest tips for saving on your home expenses?