Signing the final paperwork and receiving the keys to your new home marks an exciting transition from the end of the transaction process into homeownership, and can often be accompanied by a sense of uncertainty at what to do next. As a recent article published by Seattle Times outlines, “the first 12 months of homeownership set the tone for the entire journey.” For many, it’s difficult to know where to start and what to address first, so the Times put together 6 tips that all new homeowners should consider in order to save money and make the most of their investment.
- Emergency Funds: Unexpected expenses in the home can pop up at any time, and it’s best to be as prepared for the large ones as possible. Start saving, even if it’s a small amount, so you can create a “financial safety net.” The goal should be to save enough to be able to cover a few months’ worth of expenses.
- Look at Your Homeowners Policy: It’s important to know what your policy does and does not cover, and make necessary revisions to your coverage, before you find yourself submitting a claim for something you thought was covered but isn’t.
- Audit Energy Efficiency: An energy efficiency audit can catch small issues that will help you lower your utility bills and often qualifies you for rebates at the local, state, and federal level. An auditor can be found by contacting your local utility company or city government, and they’ll implement various tests to ensure your home is at peak energy performance.
- Home Warranties: A home warranty can be an excellent option for those in a home with aging appliances, and can often help with some (or all) of the replacement cost. When selecting a warranty, it’s important to read the fine print and ensure you are fully aware of your coverage so you are not surprised during the claims process.
- Have a Disaster Kit: Make sure you are fully prepared for a disaster with a home inventory that outlines the most valuable assets in your home. This should be stored along with other key documents including personal identification, in a safe location.
- Build Equity: In purchasing a home you are already on a path to establishing equity, but consider building it faster if possible, so you can unlock its benefits, such as using equity to finance home renovations or pay off student loans.