Being a new homeowner comes with a lot of questions. The following are tips for new homeowners that even veteran homeowners should remember, both for preventing unfortunate events and for taking advantage of every possible cost savings.
Have an emergency budget
This is the single most important thing for any adult or homeowner. Emergencies can pop up and when they do, you need a safe, accessible source of funds, such as a savings account. In times of need, credit cards can easily create a cycle of debt – a trend that has devastated many Americans. Avoid this by putting a small amount in your savings account each month, or with each paycheck.
Close gaps in your homeowner’s insurance policy
You probably already have homeowner’s insurance, which is usually required by the mortgage agreement to buy your house. However, you need to remember to regularly reassess your insurance needs and close the insurance gaps, especially for windstorms, flooding, and dog bites (if you own or will own a dog.) The National Flood Insurance Program website can help you assess your risk for flooding and decide whether or not you need flood insurance.
Take advantage of discounts on homeowner’s insurance
The two most common discounts are for bundling insurance packages, such as auto and home, and for installing protective devices like smoke detectors, security systems and automatic sprinklers, etc. Some companies offer a discount for having a newly purchased home or one that’s newly built. If your home has been recently renovated with improvements such as upgrading old wiring, you may also qualify for a discount or reduction in your premium.
Use your tax benefits!
There are many tax benefits that come with being a new homeowner and some can also bring down your energy bills. For example, when it comes to buying Energy Star appliances, check to see if the government is offering any federal tax credits. These programs change regularly so check to be sure. You can also deduct mortgage interest and property taxes on your federal income tax return.
Set up utilities on payment plans
You might want to sign up for a utility provider payment plan. The utility company estimates your yearly costs, and then divides it into twelve equal payments. This can help your cash flow and will help you plan expenses better. This eases the stress of having a tight budget during this transitional period. Some companies also automate online payments, which reduces the possibility of late fees. Going “paperless” with utility e-bills and paying your bills online could save you money too.
Get to know your home
Check all toilets, sinks, and under-sink plumbing for leaks. If you see cracks, put tape over cracks with the date. That way if new cracks appear around the edges of the tape, you will know that there is a foundation problem.
If you plan on doing anything like installing a fence, use a utility location service to create a map labeled with the location of your water main and electricity lines. Open your electrical box and label your breakers.
Know your appliances
Consult any available owner’s manuals for your appliances and review them for maintenance instructions and special features. Know how old your appliances are and when they will likely need to be replaced. A new furnace is expensive and it’s good to know in advance when you’ll have that expense.
Make inspections a habit
Planning annual inspections can make the difference between a quick fix and a costly disaster. Be sure to have your roof inspected by a professional roofing contractor. Check for problems like rodent or termite infestations and mold growth. These can cause costly damage and aren’t covered under many insurance policies. Catching problems early makes repairs easier and less costly.
Know when to buy in bulk
This is one of the advantages of being a homeowner with storage space. You won’t want to run out to a home improvement store every time you have to buy an air filter, but replacing filters are important for your energy bill. Buy in bulk so that replacing things like lights bulbs, air and water filters won’t be such a hassle. Buying in bulk is often less expensive too.
Repaint walls and/or refinish floors
If you’re sure of your decision, take advantage of having the open space to repaint or refinish before you move in the furniture. But don’t rush or spend money you don’t have. You might need time to decide on décor and you might even decide you like things the way they are!
Think about landscaping
Planting trees that give shade near your house can lower the inside temperature during warm months. Keeping out hot sun can help reduce your energy bill. Shade trees also protect your home from sun damage, which is one of the reasons that roofs need to be replaced. But make sure that large branches are not leaning too close to your house. These could become a hazard to your home during a storm.
Inspect your house for excess energy loss (and costs)
If you have an unfinished attic, check that it has at least six inches of insulation in all areas. Make sure your house is air-tight with weather stripping and caulking. This will help reduce drafts and heat loss, which can cost you, particularly in the winter months. Check your water heater and pipes, especially the ones next to the water heater, to see if they’re properly heated. If not, you can easily wrap pipes with insulation or use a water heater blanket to trap in heat. With improperly insulated pipes, you can lose 2-4°F in just the first few feet that the water travels. Well-insulated pipes also help hot water to get to you faster.
It takes a trained eye to spot all the weaknesses in a home that might cause you to waste energy on costly inefficient heating and cooling. Careful planning, research and talking to experts helps take the stress and frustration out of being a first-time homeowner.