Save Money and Be a Savvy New Homeowner

by California Casualty | Homeowners Insurance Info | 0 comments

You’ve bought a house. Congratulations! Now the fun begins. As a new homeowner, you’re going to be responsible for a lot more than when you were renting.

Follow these 7 money-saving tips to set up your new home like a pro.

Tip #1: Wait to spend on nonessentials. Fix things first.

Don’t worry about buying furniture, changing your cabinets, decorating or personalizing your home right away. Right now, your focus should be on repairing and replacing.

• • Take care of any maintenance and repairs that you can do yourself, such as painting walls and replacing doorknobs and locks.
  • Hire a qualified contractor for electrical work, plumbing, roof repair, gas appliances, and to handle any toxic materials like mold or asbestos.
  • When choosing a contractor, get cost estimate quotes from three different providers. This will help you find the one that is most cost-effective.
  • Make sure any contractors you use are licensed to work in your state. Ask for references and talk to some of their past clients.

Tip #2: Seal your home. Check your insulation and look for small air leaks.

Insulation is the material that keeps the heat in your home during the winter and the cool in during the summer. When you have the right amount of insulation, and no air leaks around openings like doors, it will help to lower your heating and cooling bills

• • Check to see that you have at least six inches of insulation in your attic. You will need more in colder climates.
  • Don’t forget to insulate around the attic opening. That’s a common place to lose heat.
  • Wrap any exposed water pipes in insulation. This will help prevent frozen pipes.
  • Caulk and weatherstrip to seal small air leaks around doors, windows, and electric outlets. These are all places where air can get in and out.

Tip #3: Regulate the temperature in your home.

Your home’s heating and cooling systems work to keep things comfortable—at a cost. You can help reduce those bills with a few simple adjustments.

• • Install a programmable thermostat. This allows you to raise the heat while you’re at work and cool down when you are home during the summer months and vice versa for the winter.
  • Lower the temperature on your hot water heater to 120 degrees F. Not only will it help with your energy bill, but it will also help prevent scalding burns.
  • Install ceiling fans. This is a great way to move air around, and help reduce the amount of air conditioning you need.
  • Close the blinds to block the sun which can heat up your house.

Tip #4: Watch for standing water or water leaks.

A sudden increase in your water bill is a sign that you probably have a leak. Keeping on top of these repairs is an easy way to prevent this unnecessary cost.

• • If you have a dripping faucet, repair or replace it as soon as possible.
  • Check under the sinks for wet spots that may indicate leaky pipes.
  • If your toilet is constantly running, that could raise your water bill as well. You may need to replace a part such as a flapper, fill valve or chain.
  • Check for a leaky toilet. Remove the tank lid and put a few drops of food coloring in the back of the tank. Wait 30 minutes without flushing your toilet. If you see the color in the toilet bowl within that time, you probably have a leak.

Tip #5: Take advantage of tax benefits and incentives.

As a homeowner, you may qualify for tax benefits and incentives if you itemize deductions on your tax return. Consider hiring an accountant to help you maximize your refund.

• • Mortgage interest is deductible.
  • Home equity loan interest is deductible if you spent the money on home improvements.
  • You may get a tax break for paying property taxes.
  • If you work at home, you can deduct home office expenses.

Tip #6: Pay off your mortgage early.

You can reduce the amount of interest that you pay if you budget correctly and pay off your mortgage early.

• • Switch your mortgage to a biweekly payment. If your monthly payment is $1,000, pay half, $500, every two weeks. You will pay the same amount that you would, but will end up making 13 full payments instead of just 12 in a year. You also will rack up less interest, which is calculated daily. Overall, this will end up saving you thousands of dollars.
  • Make extra principal payments when you send your monthly payments.
  • Consider using any windfalls, such as your tax refund, as payments toward your principal.

Tip #7: Update your insurance.

Your home is likely your largest investment. Make sure it is protected with the right insurance.

• • Your mortgage lender requires homeowner insurance. Many homeowners pay the mortgage lender who in turn pays the insurance company through an escrow account.
  • Consider bundling your car insurance and homeowner insurance to save money.
  • Make sure that you have disability income insurance so that you can continue to pay for your home in the event you are unable to work.
  • If you live in an area that floods, consider adding flood insurance. Similarly, there is earthquake insurance.
  • Consider an umbrella policy for extra coverage beyond your homeowner policy.

This article is furnished by California Casualty, providing auto and home insurance to educators, law enforcement officers, firefighters, and nurses. Get a quote at 1.866.704.8614 or www.calcas.com.