Thursday, October 20, 2011

How to Play for Less II: Owning a home

Welcome back to "How to Play for Less"! (Check out post 1 if you missed it!). Today, lets talk about houses, k? The hubster and I got married 2 years ago (aww how sweet) in August. We had been looking for a house for most of 2009, but didn't want to go through the paperwork until we were stuck together forever joined in marriage. 3 weeks after after we tied the knot, we found our house! How exciting! We were homeowners...
And it was EXPENSIVE. I won't even get into the headache of closing on a home and how much it costs ($$wise and stress wise)....that's enough material for several (sleep inducing pages). Lets jump ahead to....we moved in, settled up our old renters quarters, and now have this half an acre property to taxes....and mortgage. And groceries. And, um, living. So how do you do it?
1. Make out a "loose budget". The hubster and I have a joint account where 80% of our paycheck money goes (we both make about the same, so it's no issue. Ok, he makes more than I do. There. I said it. Phew). he other 20% IRS our "play money" but the joint account money goes toward mortgage, groceries, gas, and anything we do "together" (i.e. my makeup and his video games don't go there. I know. What make-up? That was just to fake you out). Ahem. I have a loose budget drawn up with what we usually pay in gas/electricity, Mortgage, water, refuse, joint credit card, and "miscellaneous". We make sure that amount plus an extra few hundred go into the joint account each month, so we can pay our bills.
2. Escrow your Account, if you can. Not really a "money saving tip" but it makes it so much easier not to have to remember when your taxes are due or see that $2000 bill in the mail.
3. Have a safety cushion. We know about what the monthly bills are, and have enough money tucked away to pay them for 3 months without a problem...just in case. And I won't touch that money for anything else. This is a sanity saver, if nothing else!
4. Learn how to fix it. When you own, the maintenance guy disappears. I know, it sucks! And, pretty much without fail, things break at 9pm on a Sunday night or whenever it is most inconvenient. Recently, our dryer stopped spewing heat (that's kind of important!) Instead of buying a new one, the hubster researched options online and bought a kit to fix the issue (thermostat) for 13 bucks. Awesome.
5. Get smart with your mortgage. The average mortgage takes 30 years to pay off. If you buy a $150,000 home and take the full 30 years to pay of the loan, your house will cost roughly $290,000. Woah Nelly! If you pay it off in 20 years, however, the same house will cost $237,000. BIG difference. Yes, interest is tax deductible. Yes, it's an investment. But if you have a few hundred dollars extra at the end of the month, throw it toward your mortgage. You won't even miss it, but it will pay off (Note-if you have credit card debt or loans that are higher interest rate, obviously those should get paid first, since mortgage is "good debt")
6. Do it yourself! Aside from electrical work, please. Unless you're a professional :-P. Get a push mower and mow that lawn-it's good exercise! Plan a garden. Weed your yard. Paint your ceilings. Install your own garage door opener. Seriously, there's not too much that cannot be learned from a manual and that will save you big bucks. It also gives you a sense of pride....yup, I DID THIS. (Note-my to do list is a mile long-no one said it was time prudent, but the hubster and I enjoy chipping at it bit by bit!)
7. Save on utilities. Get a programmable thermostat and agree on what is comfortable. We keep the heat set at 65 during the day and 60 during the night. No, we don't freeze. We put on a sweater if we get cold. And since we are always moving, it's not an issue. Besides, when you sleep, isn't snuggling under the blankets preferable anyways? :-) Check out your cable/Internet providers every few years to make sure you are getting a good deal or that you need what you are paying for. Check out discounts that you may be eligible for regarding cell phones or energy saving rebates. FREE MONEY!
8. Make Friends with your neighbors. I love our neighbors to death. Of course, we got the lucky draw of living next to the retired cop/neighborhood socialite who knows everyone and also protects our house. He snowplows our driveway. He gave us his push mower when our tractor broke. And he watches our house when we go away. I am jealous of his wife. (I'm teasing, Chris!) In return, we try to help them whenever we can, including babysitting or trying out my cooking skills. Hey, I'm learning. This type of relationship is not only helpful $$ wise (sharing resources) but also sanity wise. And you can't put a price on that!
9. Watch the sales. Mowers go on sale in September. Snow blowers in May. And Patio sets in August. Need something new and it isn't an emergency? Wait until the season is almost over and things go on clearance- I got so many fun lawn toys this year that way. Of course, if you don't need them, don't buy it. Now there's priceless advice, right? :-D
10. Re-Evaluate each year.  Should you refinance?  How old are your appliances?  Do you need your furnace cleaned?  How old is your roof/windows? Some basic preventive maitenance might cost a bit of money outright, but will save you money in the long run, either by saving on utilities or costly TOTAL repairs later on.  Stay on the ball....remember, this is your investment!

Not an expert of course, but just a few tips the hubster and I have picked up along the way.  Any that I missed or you can think of?

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