Hidden Costs New Homeowners May Overlook (And How To Avoid Them)
Preparing for unexpected costs is an important part of buying your first home. Be prepared to cover a variety of costs.
After months or years of diligent money management, you saved up enough to buy your first home (maybe you even contacted one of BALANCE’s Certified Financial Coaches for guidance). Now you get to enjoy the stability of homeownership, and the prospect of having a healthy financial asset once it’s paid off.
Of course, that doesn’t mean you should stop saving. Indeed, owning a home means you’ll have to stay prepared to cover a variety of costs — some less obvious than others.
That’s right, while all homeowners likely incorporate a mortgage and maintenance into their monthly budget, there are certain under-the-radar expenses that come with a new home.
Lack Of Insulation
No matter what part of the country you live in, you’ll probably need to run your heater during the cold months. As a homeowner, you quickly realize that the gas bill can balloon past expectations if you keep your house warm all day and night. Remembering to turn it off or lowering the temperature when you leave or go to sleep will help lower costs, but there may be an even more effective tactic.
By keeping your attic adequately insulated, you’ll regulate heat flow in your home. Six inches of insulation or more between the beams in your attic is considered sufficient. So if you have less, consider adding to it.
Some costs are hidden because they’re not obvious; others are literally concealed from view. Pipes, for example, run behind the walls throughout your home. You assume they’re structurally sound but it’s hard to know for sure.
This can become problematic if you have a leak. If pipes fail or become corroded, your water bill will take a hit. Bottom line? Keep an eye on your bill for any surges in monthly costs. And if you suspect that you may have a leak, don’t wait. Inspect it ASAP before the problem gets worse.
An Over-Heated Water Heater
Just as proper insulation can keep your gas bill in check, a regulated water heater will keep utility costs down. Most of us don’t pay much attention to that large tank tucked away in an inconspicuous corner of our basement or garage. As long as hot H2O runs out of the faucet, all is good, right?
The problem is that when the temperature on the heater is set too high, it drives up gas or electric costs (depending on your type of heater). The sweet spot for temperature is 120-degrees Fahrenheit. Set your temperature accordingly, and you’ll still be able to enjoy a hot shower while trimming costs off your monthly utility bills.
An Old HVAC Unit
If your new home came with a new HVAC unit, you’re in good shape. If your unit is 12 years old or more or if you’re not sure of its age, have it inspected by a professional. The cost of service may require you to dip into your savings a bit, but the alternative is worse; replacing a burned-out air-conditioner unit could possibly cost thousands of dollars.