First Home? Budget for the Costs That Start After Closing
- 1. Repairs and maintenance
- 2. Taxes and insurance can change
- 3. Utilities are usually higher
- 4. Furnishing and tools
- 5. Rebuild the cash cushion
- Free tools
The deposit and closing costs get all the planning. The first year of owning a home brings a second set of costs that many buyers don’t budget for.
1. Repairs and maintenance
A common rough guide is to set aside about 1% of the home’s value a year, more for older homes. On a $300,000 home that’s about $250 a month. A separate savings pot keeps a boiler or roof repair off the credit card.
2. Taxes and insurance can change
If they’re paid through an escrow account, your payment can rise after the first annual review when the property is reassessed or premiums go up. Leave some room in the budget.
3. Utilities are usually higher
More space usually means bigger heating, cooling and water bills than in a flat. Use the first few bills to set a real monthly number.
4. Furnishing and tools
Curtains, a lawn mower, a ladder, basic tools: small items add up. Give them a fixed budget and buy over months instead of all in the first week.
5. Rebuild the cash cushion
Most buyers empty their savings at closing. Make refilling the emergency fund the first goal, before extra mortgage payments.
Free tools
- Sinking funds calculator (repairs, insurance, furnishing): https://smartbudgetsheets.surge.sh/calculators/sinking-funds-calculator/?utm_source=nostr
- Home renovation budget spreadsheet (free CSV): https://smartbudgetsheets.surge.sh/templates/home-renovation-budget-spreadsheet/?utm_source=nostr
- Savings Goals tracker with 12 goals (Payhip): https://payhip.com/b/ZbfXe?utm_source=nostr
- 42 free budget templates, pay what you want ($0 is fine): https://smartbudgetsheet.gumroad.com/l/ngpkrb?utm_source=nostr
General information, not financial advice. Figures are rounded examples.
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