By Alyssa Fischer | Mixed Up Money
You need to be overly prepared for any type of emergency.
So, you bought your first home! What an exciting time. I know and remember the feeling quite well. Just six months ago my husband, daughter and I moved into our first ever home that wasn’t a rental and we were extremely elated.
The excitement was overwhelming, to say the least. We realized very quickly how expensive the cost of living in a home would be, regardless of our financial preparedness, and we also started to compile a laundry list of home maintenance we would need or equipment we would require to stay on top of upkeep. Items like a lawnmower, a ladder and sprinklers were something we’d never had to buy before. Among all of the unexpected small expenses we took on, there were and are a ton of important steps we wanted to take now that we were officially homeowners.
Update your will and estate plan
The day after I become a mom, I got my responsible self together and my husband and I created a will. We didn’t have any doubts that this was essential, for the sake of our child. We knew that if anything were to happen to us, we would want to ensure she was covered in every sense of the word. The same feeling crossed my mind when we signed the mortgage on our first home. I knew we would need to update our will. Something I always share with my friends and family is that wills aren’t just for the rich. If you have a family, if you have a property and if you have any savings (at all), you want to ensure that whatever personal belongings you do have, go to the right people. If you’re a new homeowner and don’t have a will, now is the time!
Make an annual general maintenance checklist
The second you become a homeowner, more experienced homeowners *cough* your parents *cough* will start to immediately stress you out about all of the responsibilities that you have and all of the ways you must take care of the property to ensure no risk of unexpected emergencies. The one thing about a home is that it’s only a valuable asset to you if you continually maintain and update the land. If you’re anything like me and have way too much on your mind to remember what you need to do and when to do it, consider putting together a general maintenance checklist for your home. Another even better idea is to actually use a monthly housing budget that includes all of these to-do’s so that you’re also financially prepared for the costs associated with those repairs.
Start saving an emergency fund that is strictly for your home
If you read a lot of personal finance content, you know as well as I do that a common suggestion is to prepare an emergency fund, and honestly – this still rings true. You need to be prepared for job loss, health emergencies and unexpected life changes that can put your finances into duress. Once you become a homeowner, there is an added risk of surprise damages or lingering repair bills that you hadn’t planned for. A good idea is to keep a separate emergency fund that is strictly used for housing emergencies, or that is there as a back up to your original back up plan. This is especially important for new homeowners who purchase condos or apartments that may have surprise strata fees or an unexpected increase to condo fees.
Tackle your home inspection list
When you were in the final stages of purchasing your home, you would have had a home inspection done. When you received that report, a good home inspector would recommend areas that may need small or significant repairs or updates. As awesome as it is to receive this, it can be a lot of work to consider when you’re busy moving and adjusting to life as a new homeowner. Therefore, this work tends to get put on the backburner. Well, hello. I’m here to remind you. That light switch that needs fixing or that more significant deck that needs a better form of support is still lingering. Don’t forget to take care of your assets.
Get serious about life insurance
One thing that you might need to think about when you become a homeowner is the potential for what would happen if you are injured or you or your partner unexpectedly pass away. Would you be able to afford your mortgage on your own? I know, I know, I’m throwing a lot of heavy thoughts your way. However, sometimes it’s necessary to consider the reality that one day, you could face a devastating situation that requires heavy financial support. Your mortgage insurance doesn’t protect you and your family. Instead, it covers the bank. So, use your judgment when researching whether or not life insurance is a necessary purchase for you.
If you’re a new homeowner, the bottom line is that you need to be overly prepared for any type of emergency or expense that might come your way. Take care of your assets and take care of your finances, and you’ll be an expert homeowner in no time.
By Alyssa Fischer | Mixed up money | January 21, 2020
NB: This article may have been edited and /or condensed. The information contained is as of date of publication and may be subject to change. These articles are intended as general information only. A licensed advisor should be consulted regarding your specific situation.