For many Canadians, home ownership is the ultimate goal. But with record-breaking house prices, many people are finding themselves house-poor, meaning that they don’t have a lot of money left over at the end of each month.
Houses are expensive – not only to buy but to also maintain. According to Statistics Canada, the average homeowner spends about $12,000 per year on household maintenance. If you own a home, you should have an emergency fund for urgent and unexpected home repairs.
Far too many property owners have mistakenly not accounted for unexpected expenses in their budgets. If you have ever encountered an emergency repair around your home, you probably learned how important it is to put money away for a rainy day.
Here are some tips to consider when creating a budget plan for your home maintenance costs:
- It’s better to overestimate your expenses than to underestimate them
- Delegate money to a specific savings account for items likely to malfunction sooner rather than later
- Purchase a home warranty policy with an experienced service repair company that specializes in preventive maintenance (appliance repair, roofing, etc.) to minimize costs in the future
Accounting for Potential Costs
If you usually overspend, it may be time to start thinking about saving more money. There are many ways to prepare you for your most significant financial commitment. Creating a household budget is one of the best ways to account for the potential home maintenance costs.
Set aside specific monthly money to be dedicated to home repairs and updates (find out how much money you should be saving for emergencies). You may not always use these savings each month, but this number will grow over time and allow you to avoid using credit for minor home repairs. Furthermore, you will have funds available in the future if you decide to make improvements to your home or want to update it before selling.
For help setting up a household budget that allows you to save for house maintenance costs, contact us about our free budget mentoring service. Our experienced team can assist you in preparing a budget that works.