Buying a house is a huge deal – it’s the sign that you’re growing up, embracing the American dream and it shows financial stability. A mortgage is an example of secured debt and improves your credit and it’s your own slice of land you can build a life on.
That said – owning a home is expensive. You’ve got your mortgage, sure, but also homeowners insurance, property taxes, upkeep and depending on how much you owe, mortgage insurance. There’s a ton there to keep track of, let alone pay on every month, so knowing where you can save money is a huge deal. This is especially true when you consider you’ll be paying on your mortgage for probably at least 15 years.
Every little bit you save literally very much matters, so let’s figure out how to keep some money in your pocket while paying that property down.
Get every bit of money out of energy efficiency
This is especially true if you bought a fixer-upper kind of house, but every energy efficient thing you install will save you money. Energy efficient windows, doors and heating or cooling systems will save you a bundle over their lifetime.
In addition, there are still federal tax credits as of 2019 for energy efficient upgrades to your home. These credits include solar upgrades to heating and power, so if you’re considering making your home a solar home, make sure you get your tax credit!
Check in with your insurance
Insurers want to make you as small a liability as possible, so many times your insurer will offer benefits to upgrades that save you money on your premium. Things you might invest in anyway like a security system can very much lower your monthly insurance bill. This is also true for integrated fire and smoke alarm systems that work with a downloadable app. These things increase your ability to respond to break-ins or disasters and can lower rebuild costs on the back end, so make sure you’re talking with your insurance agent to get the most discount for your efforts.
Monitor your utilities
It might be hassle to have your electric and gas companies come out on a seasonal basis but it’s essential. Often your electric company will base your cost off projected usage unless you ask them to come assess it, especially if someone else recently lived in the house. As a homeowner, you need to use that little meter to track your own usage and then compare it to your bill to ensure everything matches correctly.
With this in mind, knowing your actual meter usage and what you’re being charged for can show that your meter is broken. It can also show that projected meter readings are too high and need to be adjusted. It might also be worth getting an electrician to come out and check where you might put in some upgrades to lower wasted electricity. If your house has old outlets, for instance, you might be wasting electricity or there might be newer, energy efficient models of existing mechanicals that will save money in the long run (water heater, furnace, etc).
Finally, check and see if your utility provider has a level-payment plan. These will take the hyper-expensive months of summer electricity usage and smooth them out throughout the year. So rather than paying $250/month during the summer and $50/month during the winter, you have a nice, predictable bill each month. The same can be done with your gas bill, so definitely check it out.
Get a homestead exemption
If you’re a new homeowner and this is where you’re going to be living, ensure your home is listed as a homestead with your property tax office. While it can depend on your state and even your county, homestead exemptions do exist and can save you a ton on your property taxes each year. Though some areas only allow this for veterans or seniors, there’s no downside into check with your county clerk’s office to make sure you’re getting the maximum discount available to you.
Perfect your water heater’s temperature
Set your water heater to 120 degrees and make it stay there. Most people don’t want water hotter than that for anything, and most heaters are set higher, risking your chance of scalding. In addition, setting it higher will definitely increase your bill, so keeping it at a toasty 120 is ideal.
There are also water heater blankets you can buy that act as thermal insulators to keep the heat in, lowering your bill further. They work by preventing the slow leakage of heat into the surrounding area and are especially effective if your water heater is in a basement, where it’s typically colder.
Replace those furnace filters!
Air filters are not something everyone thinks of but if you forget them, your home will be that much worse off. They filter out dust when your furnace or central air is running and will dramatically improve indoor air quality.
Dirty air filters, however, will also make circulating cold or hot air tremendously difficult and will increase your bill by quite a bit. In particular if you’re buying a house from somebody else, ensure that you check those air filters as quickly as possible and change them every 3-4 months. Likewise if you’re buying a house that’s been sitting without occupants for a while, you might want to change them every 1-2 months for the first 6 months to a year, as there will likely be quite a bit of dust built up.
Take notes of potential future problems
– If you’re buying an older home, you’ll notice cracks in the foundation – it’s basically unavoidable as a home ages. In many cases, these cracks won’t get much worse if at all, but there’s one surefire way to keep ahead of them.
– Take a length of duct or masking tape and cover the crack lengthwise, until you’re covering the very end and no more. Then, date the tape and come back yearly to ensure that the crack hasn’t grown beyond the end of the tape. This will allow you to tackle a potential problem before it becomes a current problem.
– Get a plumber to make sure that your toilets aren’t running constantly, or your faucets aren’t dripping throughout the day. Small things like water cycling all the time can add up to big costs.
– Have your home inspector take some photos of the roof (they usually do anyway) to identify where patching might help add years to your roof. Problem areas that aren’t patched up early can turn into huge issues that might require a whole new roof far sooner than you intended.
Invest in LED bulbs
It probably goes without saying to turn off your tv/lights when you’re not using them. Considering that electric lighting can cost a bundle – 20% or more of your total electricity bill – it stands to reason to get the most efficient bulbs possible. That’s where LED and CFL bulbs come in.
Up front, you’re going to pay more for either one over traditional bulbs, but both LED and CFL bulbs will last far longer. They also use less electricity to put out similar or better light, so what you invest on the front end will pay dividends over time.
Insulate that attic
Insulation isn’t pleasant to install but it’s not difficult or expensive and it will keep your home warm in the winter and cooler in the summer. If you have an attic and it’s just bare slats and a floor, get some insulation in there to dramatically cut your temperature bills. The same goes with your basements and crawlspaces.
Get a digital thermostat and learn how to use it
Those old dial thermostats are pretty reliable, but they’re not great on your wallet. They’re slow to react to temperature changes and since they can’t be programmed, you’ll end up with the heat or air stuck running at the same temperature all day and night.
Upgrading to a digital thermostat is cheap and easy, and you can set different temperatures for different times. Not home during the day? Bump the air conditioning to 78. Sweltering at bedtime? Keep it at a lower temperature and have it programmed to go up when you leave for work. This will save you money and ensure your house is at a great temperature for sleeping, hanging out, or when you’re absent.
Put it all together and start saving
There’s a lot that goes into owning a home, inside, outside and on the financial side. You can save a lot of money by getting ahead of problems and upgrading your home. Talk to your insurer and county clerk to keep your insurance and taxes as low as possible.
There’s no reason for you to spend more than you need to on your home payments. By using these tips, a new homeowner can actually put more money into their home in ways that are fun and pleasant. How about you? Do you have some tips for new homeowners that can help with their monthly costs? I’d love to hear about them in the comments!