Anyone who plans on buying their first home should know the basics of homeowner’s insurance. Even seasoned consumers who have been in their house for a long period of time need to stay in the loop about new types of home insurance, coverage types, and terms. It has almost become a cliché to say that owning a home is the single biggest expense in a person’s lifetime, but the fact is, it’s a true statement and carrying the right amount and kind of insurance on your home is an essential part of financial planning.
Being a new homeowner can feel overwhelming, especially if it’s your first home. There’s maintenance and landscaping to worry about, projects to make your home look beautiful, and if something goes wrong in your home you are now responsible for fixing it instead of a landlord. Despite all the things that may seem overwhelming about owning a home, it can be a very rewarding experience, especially if you have a plan to help you save money along the way.
Don’t Bite off More than you can Chew
Taking on new DIY projects can be a lot of fun for many homeowners. You may watch home improvement shows and research remodelling projects to make your home magazine worthy. However, it can be exhausting to take on too many projects at once, and it can even eat a sizable chunk of your savings if you are not careful. Unless you plan on flipping and selling your home in a couple years, and if you want to tackle all your projects at once, try spacing them out over the life of your home ownership, or at least until you’ve built up your savings again.
But Don’t Ignore Maintenance
Choosing your remodelling projects carefully so you don’t taking on too much at once. But this doesn’t mean you should ignore your home’s routine maintenance. Even though you are still spending money, and ensuring your home receives routine maintenance, it is actually a helpful way to prevent costly repairs down the road that could have been avoided. If you address a problem while it’s small, it may be much cheaper than waiting until it becomes a larger problem.
Buy Quality Insurance
If something does go wrong with your home, you may be able to file an insurance claim, depending on the terms of your homeowners insurance policy. This can come in handy if you need to completely replace your roof because of severe ice damage and don’t have the money in your budget, or you are the victim of a break in and need to replace damaged windows. The first step towards this should be investing in a quality homeowners policy that cover these type of situations.
Invest in the Right Improvements
There are some home improvements that may increase your home’s value and save you money along the way. Smart thermostats, for example, may come with rebates or tax incentives and can save you money on your monthly energy bill while increasing your home’s value due to its helpful technological use. There are a number of these types of improvements you can make that aren’t costly and can pay off in future savings.
Take Advantage of Tax Incentives
Certain home improvements can offer you significant tax benefits. For example, if you upgrade an old, inefficient furnace with a new high-efficiency model, you may be able to use the cost of the heater as a tax write off. Hold onto your receipts, whenever you make a home improvement, and always be sure to check with your tax professional to see how you can maximize your tax deductions.
Know Your Limits
There are some projects around the home, such as stripping wallpaper and painting a room, that you can tackle yourself. But there are others such as rewiring your home or overhauling your plumbing, that you shouldn’t touch unless you are a licensed professional. It can actually save you money, in the long run, to hire a professional right from the start so that they don’t have to spend timein fixing your mistakes.
If you follow these tips, owning a home can be a lot less stressful. The key is knowing what you can handle, taking advantage of extra savings and incentives, investing in quality insurance, and making the right improvements to your home. If you can manage to put a plan into place, stay away from unnecessary projects, and know when to ask for professional help, you’ll find that being a homeowner can be a rewarding experience.
Having a home insurance policy doesn’t ensure that you’re protected from certain types of disasters. Most home insurance policies have large gaps that leave you exposed to expensive repairs. Double-check your home insurance policy to see whether it covers these four things. If it doesn’t, then you might need extra coverage.