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Budgeting Tips for Unexpected Home Repairs

Published Aug. 17, 2022

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Owning a home is an excellent investment but saving for unexpected expenses and repairs is essential. Even newer homes can have issues shortly after moving in. It’s highly recommended that you go into a new home with money saved for the unknowns and continue saving money yearly. Here’s how you can save for unexpected expenses and repairs.

Build a reserve

Experts suggest setting aside 1 percent to 3 percent of your home’s purchase price yearly in a separate savings account only for home repairs and maintenance. For example, if you purchased your home for $400,000, set aside at least $4,000 each year.

Maintain home throughout the year

How you maintain your home throughout the year can greatly impact the number of expensive home repairs you’ll have. Be on the lookout for small things that may need attention and address them early before they become a more expensive problem.

Do repairs yourself

If you’re comfortable doing minor repairs on your own, that can save you money because you will not need to hire someone to do the repairs for you.

Conserve energy

Reduce electricity and gas bills by buying energy-efficient appliances and LED light bulbs to help save money.

Purchase a home warranty

If you have a hard time setting aside a significant amount per month for repairs, consider purchasing a home warranty when purchasing your home. Depending on your chosen plan, it can cover repairs for appliances and other large systems in your home.

Apply for a home equity line of credit

A HELOC can help you tap into your home’s equity to pay for unexpected expenses. With this option, it’s important to keep current on the monthly payments so the lender doesn’t foreclose on your home.

Do you want to learn more about your options when faced with unexpected home expenses? We are here and ready to answer all your questions!

Sources: MarketWatch

 

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