5 THINGS FIRST-TIME HOME BUYERS SHOULD CONSIDER
You’re all moved in. The locks have been changed, your favorite recliner is perfectly placed so you can see the TV and out the front window, and all the boxes are unpacked. What do you do now?
Owning a home is a huge responsibility. It means planning for both the expected (maintenance tasks like cleaning out the gutters) and the unexpected (a bad storm flooding the basement). Creating a game plan for home ownership is a smart move, so here are several things you need to do now that you’ve bought your first home.
1. DOCUMENT YOUR VALUABLES
You’d be devastated if you lost all the things that have value to you, wouldn’t you? This is why it’s important to document all the things you see as emotionally valuable or that have true value for insurance purposes. As you unpack, create a spreadsheet and list the important things accordingly. Save the document at work or in the cloud just in case your computer is among the things lost or destroyed.
2. MAKE A PLAN FOR MAINTENANCE
Upkeep is a responsibility of home ownership. Your home is an expensive investment, so it’s vital you conduct routine maintenance to keep it in tip-top shape. Download an app to your phone that will remind you to do things like change filters, clean out gutters, and change your smoke detector batteries throughout the year.
3. START AN EMERGENCY FUND
After paying the large down payment for your home, it can be a little overwhelming thinking about saving another big chunk of money, but the last thing you want to do is be caught without enough funds to cover emergencies like the HVAC system going on the fritz.
A good rule of thumb for an emergency fund is saving one percent of the purchase price each year. If your home cost $150,000, you’d put away about $1,500 every year.
4. THINK ABOUT BUYING A HOME WARRANTY
Home warranties are service contracts designed to cover things like a faulty furnace or broken dishwasher. You pay a quarterly or annual premium for the coverage, which then repairs or replaces these issues.
5. BUY ADDITIONAL INSURANCE
If your employment or health is on shaky ground, it may be advantageous to purchase additional insurance that covers your mortgage payments should you lose your job or become disabled. While this type of insurance definitely gives you peace of mine, be sure to read the fine print as some policies only continue to pay your mortgage payments for a limited period of time.
Owning your first home is an exciting time, but it’s also a time to be the most responsible you’ve ever been in your life. You’ve made a huge investment in something that requires routine maintenance and lots of planning. Use the tips above to make sure you’re doing everything you should after buying your first home.