1. Revisit your budget.
After the buying process, it may be tempting to slack with budgeting but this is not something you can afford to skip. Work out your budget and ensure it covers all the costs of owning a home. The mortgage is the priority but also budget for utility costs, homeowner’s association or condo fees, and maintenance or repairs.
It is important to prepare for maintenance. According to statistics, homeowners spend $2,000 per year on minor and routine maintenance alone. The price range for repairs is not small so alway set money aside and be ready.
2. Update your insurance policies.
Homeowner’s insurance is a given with your first home. However, you may be interested in acquiring other policies, like life insurance and disability insurance.
Life insurance protects your family in the event of your death. The money can be used to pay off the mortgage, send your children to school, and pay existing debts. Getting a policy that will pay off your mortgage and cover living expenses for your family for a few years is a good idea.
Meanwhile, disability insurance covers you in case an injury or serious illness keeps you out of work. The money will be crucial to keep up with your mortgage payments and support your family.
3. Adjust your financial plan.
Your monthly expenses are sure to increase after buying your first home. Adjust your financial plan accordingly to meet this new challenge and stay on track with your other financial goals.
Check your contribution rate to your employer’s plan if you have a 401(k) or similar retirement account at work. Compare that with your newly updated budget to make sure that the amount is sustainable or if it can be increased. Having an emergency fund worth a year of your expenses is another worthwhile goal, as well as saving money into college accounts for your children.
There may be a lot to plan but this is the exact reason why you should revisit your budget. Your new house creates new financial responsibilities but does not let that overwhelm you. Prepare yourself financially and you will be able to address everything to take care of your new home.
For more information visit: How to Manage Your Money After Buying Your First Home