As a homeowner, it’s hard not to feel the pinch of financial stress. But there’s a difference between feeling some pressure and being overwhelmed by money problems. Thankfully, a little financial strategy can go a long way towards relaxing your mind and providing new opportunity.
Proven Money-Saving Techniques
There’s a difference between being financially-savvy and cheap. While cheap people get a bad rap for cutting corners and making questionable decisions to save a few pennies, financially savvy individuals make wise choices with money in order to yield positive long-term gains.
In other words, it isn’t always about saving a quick buck (though this is often the result). Sometimes it’s about setting yourself up for saving hundreds or thousands of dollars in six months or six years.
As a homeowner, there are plenty of opportunities to save money both now and down the road. Here are some practical techniques:
The first thing to think about is your mortgage and the financing details that determine your monthly payment, as well as the amount of money you’ll pay over the life of the loan.
Not only do you want to get good mortgage terms on the front end, but you also want to focus on paying off the loan as early as possible to save on interest and fees. Making just one additional monthly payment per year can save you a ton of money in the long run.
“A $200,000 30-year home loan with an interest rate of 5% would cost $186,512 in interest with the traditional 12 payments a year,” personal finance expert Reed Karaim explains. “Make the equivalent of 13 monthly payments every year, and the loan will be retired in 26 years and you will pay only $153,813 in interest — a savings of $32,699.”
This is why it’s so important to keep the big picture in mind. While you’ll technically pay more per month in the short term, you’ll save a massive amount over the long haul. Perspective is everything!
When most people buy a house for the first time, they only think about the monthly mortgage payment. However, what they soon realize is there are a number of other expenses – including utilities. When gas, water, electricity, trash, cable, and internet are all accounted for, the total is typically a few hundred dollars per month. But there are ways to lower the amount you pay through savvy decision making.
For starters, can we talk about cable? If you’re still paying $150 a month for cable television, you need to enter the year 2019 like the rest of us. Cable is a waste of money! You can purchase streaming packages – including ones that offer all of your favorite live channels and sporting events – for a mere fraction of the cost. (Or you can cut out cable altogether!)
In terms of your gas, water, and electricity, making some changes to your home and/or habits can improve efficiency and potentially save you hundreds or thousands of dollars per year. Start by changing light bulbs to LEDs; sealing cracks, gaps, and leaks around windows and doors; insulating your attic door; replacing old appliances with newer ENERGY STAR alternatives; installing a programmable thermostat; and switching to a tankless water heater.
- DIY Projects
Any time you’re about to have work done on your house, pause and ask yourself one simple question: “Can I do this myself?”
In today’s world of online tutorials, YouTube channels, and self-help blogs, there are hundreds of tasks that you can do on your own without any experience. From swapping out appliances and painting walls to staining decks and replacing windows, it only takes a few tools and attention to detail to make it happen. Not only will you save in labor costs, but you’ll significantly increase the value of your house.
Be a Discerning Homeowner
Most people choose to stop renting and buy a house because of the freedom it provides. And while it does yield considerable independence, there are significant responsibilities that come with the title of homeowner. Make sure you’re living up to these duties and making smart choices that put your family in a position to be financially successful. Following a few of the techniques outlined in this article will get you moving in the right direction.