7 important tips for someone who just bought a house
There's nothing more satisfying than buying your first home, especially if you've lived in rental housing or with your parents before. Some homeowners start to lose their heads with excitement, take rash actions that can critically affect their finances and put their entire estate at risk. Early in the important stages of living in a new home, you can save your budget and your efforts.
Don't waste money on things you don't need
You have just bought your home, spent a large amount of money as a down payment. Some finances were spent during the move. Your wallet will be depleted at first from insurance, bill expenses, etc.
Of course, every owner wants to improve their home, spend money on repairs, replace temporary furniture with something more comfortable, but you shouldn't try to improve everything at once. No matter how comfortable a new bed is, it should not jeopardize the availability of your property.
Give yourself time to settle in and get used to the new expense. Restore your finances, create a minimal safety cushion. New furniture will wait for you at the store anyway, when you are in a more comfortable financial position.
Don't neglect maintenance
Repairs are often an important part of the expense that comes into play after you buy a home. Sure, if your finances are going through bad times, trivial things like replacing wallpaper are best left for later, but you shouldn't neglect serious issues that could put your health at risk, or spill over into something worse. Delaying repairs can turn your little problem into a serious financial crackdown and a threat to your health. A great way to prevent this is to have your home inspected before you buy it.
There's no need to try to save money when renovating your home if you don't know how to do it. This may contradict the first point of the article, but in fact, qualified workers can help you save money and protect yourself from unnecessary risks. If you value your home, it deserves to be treated with care.
If you can handle painting the walls yourself, then definitely go for it, but if you don't know how to work with electrical wiring, it's better not to start. Qualified workers will help keep your home in good condition, and most importantly, keep you safe from injury.
You may not like the idea of using an accountant if you do your own tax returns, but it can be very effective. Even if you don't have a lot of money left over after buying a house, you shouldn't skimp on tax preparation. Find an accountant who can help you file your returns correctly.
Keep receipts for spending on improvements to your home.
If you are going to sell your house, you can use your receipts for home improvements to raise the base price of your home. This will help you get more tax-free income from selling your home.
Improvements vs. repairs
Not all of your spending will be considered in favor of increasing the base price of your home. For example, repairs will not be considered by the IRS as an increase in the home's original value.
Sure, if you've repaired a lot of broken items, you may be able to say that the house is starting to cost more, but the IRS will consider that you got a discount on the purchase of the house anyway because those improvements were not made.
Discuss any concerns you have with the IRS or your accountant. So, don't waste money on any unnecessary "repairs" if you want to increase the base value of the house in the future.
Your lender may ask for home insurance only, but it's actually wise to insure your property for total loss as well. This is not the only type of insurance you may need as a homeowner. If you live with someone who is counting on your income to pay off a lender, you could benefit from life insurance with that person so that if you die, that person won't lose their home. It's also a good idea to have insurance in case you become so incapacitated that you can't work. Then this insurance will replace your income.
Also, if you own a home, you have more things you could lose in the event of a lawsuit. Make sure your car is insured.
In case you own property that may be more expensive than $250k (which is usually covered by regular insurance), you can buy an umbrella policy, which is fine in case you are counting on a million dollars.
Buying a home is a significant moment in everyone's life, but with that moment comes a lot of responsibility. You need to manage your finances wisely, and you need to keep an eye on the condition of your home to protect your investment, yourself, and your family. Think about your decisions, and then buying a house will leave only positive emotions.
Was this article helpful?31 Posted by: 👨 Daniel C. Nealy