Buying a home is one of the most important decisions in life. However, before you can really say “I’m home”, you’ll have honour a number of responsibilities, starting with repaying your home loan instalments every month.
“In fact, regularly missing your instalments could even extend your bond by a number of years, meaning more time dealing with the associated financial stress than enjoying the asset you worked so hard for.”
However, he says there are a number of smart and easy ways to save money, ensuring that you can make the monthly obligations necessary to finally claim your ‘forever home’ and still take care of your needs.
Van der Hoven shares Standard Bank’s top tips to get you on the savings trend:
1. Create an emergency fund
It’s smart to save money consistently for that ‘rainy day’. An ever-growing emergency stash will allow you to solve unforeseen domestic problems, such as a dripping tap or burst geyser, without piling on the financial pressure.
2. Don’t be in a hurry to decorate and renovate
Repairs are important, but cosmetic upgrades can wait until you have settled into your house. This will allow you some time to figure out exactly what you need or want to do, and save for it.
3. Don’t skip important repairs - they are not renovations, but necessities
Buying a home is one of the most important decisions in one’s life, however, before you can really say, “I’m home”, you’ll have a number of responsibilities to honour to actually own the four walls in which you sleep, says Van der Hoven.Try not to postpone doing your household repairs, or you could end up with a bigger, more expensive problem than when it started.
For example, if you don’t fix that annoying crack in the ceiling that leaks every time it rains, it may grow and flood your living room the next time a storm hits, resulting in a very costly patch-up process.
4. Invest your yearly bonus or 13th cheque into your bond
If you receive a yearly bonus or windfall from a source outside of work, it’s wise to use that money to help pay off your home loan. Not only will your bond be paid off sooner, but you could possibly free up some cash to place in other important investments, such as your retirement savings.
5. Get insured
Getting home insurance is the best thing you can do to make sure you can restore your most prized asset to tip-top shape without breaking the bank should something unforeseen occur.
Though, almost like paying off your home loan, you will have to pay a monthly premium, it’s worth it to protect your peace of mind and finances.
6. Monitor your electricity and water usage
It seems obvious, but these are areas in which people are often the most unintentionally wasteful, and so the costs of their monthly utility bills can soar.
Easy and effective fixes to the problem of high electricity and water costs include:
- Fixing linking taps.
- Turning off your geyser during the day and when you leave on holiday.
- Ensuring that the lights are only on in occupied rooms.
“A home shouldn’t be a burden, but an investment,” says Van Der Hoven. “That’s why it’s crucial to plan financially for what happens after you purchase your house, and to understand your finances so you avoid spending money unnecessarily.”
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