Since owning a home, of one’s own, represents ownership, in the single, largest, financial asset, doesn’t it make sense, before one should make the decision, to become a homeowner, the individual must prepare for the responsibilities, duties, and relevant factors? Owning a house, should be a positive, fulfilling experience, which enhances, rather than makes one’s life, worse, and more stressful! With that in mind, this article will attempt to briefly examine, consider, and discuss, 5 specific items, potential homeowners should be prepared for, thoroughly, effectively, and in, a well – considered manner.
1. Known monthly charges: Owning a home, is usually accomplished, with the assistance of a mortgage. The first thing, one should consider, is if he can comfortably afford this fixed monthly expense, and secondly, if he can do so, without, stressing – out! Mortgage expenses generally include interest and principal payments, taxes, insurance and other escrow items, etc. In addition, it’s important to consider other regular costs, including utilities (including electric, gas, oil, heat, hot water, telephone, Internet, cable television, etc).
2. Reserve for minor repairs: When you own a house, invariably, something needs to be fixed, repaired, and/ or replaced. These regular maintenance issues should be planned, and prepared for, and smart homeowners, make regular, directed deposits, into a reserve fund, focused on these priorities, and issues.
3. Reserve for major repairs: There will be times, when a necessary repair, may be somewhat costly, and considered, a major repair. This may include, issues pertaining to paved/ cemented areas, structural (unforeseen) issues, or related to the grounds (such as a retaining wall, etc). Therefore, one should plan accordingly, and have a separate reserve fund, which one regularly contributes to, for those contingencies/ emergencies!
4. Renovation fund: Often, once someone lives somewhere, they realize they would benefit, if certain areas were renovated, upgraded, enlarged, etc. While this might be put – off, for a short time, it might be essential, for thoroughly enjoying one’s home. For that reason, it’s wise to create and contribute to, a renovation fund, so when it’s time to renovate, the stress is reduced, and one is properly prepared, and ready.
5. Recurring replacement fund: Certain items in a house have somewhat of a finite – life span. For example, generally, hot water heaters, need replacing, approximately, every 10 years. Roofs may have anywhere from a 20 to a 40 year, life. Heating systems, HVAC, etc, also eventually need replacing. Items such as carpets, or refinishing hardwood floors, must be considered, also. Remember, you are buying a house, where these items have served, already, for some period of time, so doesn’t it make sense, to be prepared, and better, safe, than sorry?
These are just 5 basic items, where homeowners should prepare, as well as possible, so they can maximize their enjoyment, by reducing their stress. Are you willing to discipline, yourself, and take the necessary steps, to prepare, to the best of your ability?