5 Saving Secrets For When You Own Your First Home
Owning your first home is a momentous occasion. It brings together everything you’ve worked towards for so long, as well as new challenges and responsibilities that come with it.
When you own a property, you also have to deal with some costs that you didn’t have to think about before, like household bills. From utilities such as gas and electricity to water rates, there are many expenses to consider when moving from renting to owning. However, despite the added costs, it’s still an exciting time in your life, and one which comes with some great financial benefits over renting for the long term.
Scroll down to discover 5 tips on how you can save money when you own your first home:
Change your electricity supplier and plan
When you own a home, you have more freedom to choose your electricity supplier than you would as a tenant. You could switch to a supplier that offers a cheaper rate, a cheaper plan, or a shorter contract term, giving you greater flexibility in managing your costs. Our team of mortgage brokers in Perth suggest sometimes going month to month and not locking yourself in.
If you’re renting and looking to transfer to a new home, you can also consider your landlord’s energy supplier. If there are a number of different suppliers in your area, you can get a quote from each and select the best option for you and your lifestyle. You can also research the best plans available and how they stack up against your existing plan to see if there are any benefits to be had.
Bundle your bills
When you rent an apartment or small home, you might only have one utility bill to worry about. However, when you own your first home, you will have to pay for a number of other bills, such as water and gas separately as well as many others that seemingly come out of nowhere.
You could save money by bundling these bills, also known as combining your utilities, and paying them to one provider. This way, you only have one bill to pay each month, as well as one payment due date. It also gives you more flexibility to switch providers if you find a better deal elsewhere, which is handy if gas and electricity prices keep rising.
Check your insulation and windows
When you own your home, it’s important not just to consider the roof over your head, but also the walls. That’s because insulation plays a big part in determining how much you pay in utility bills, or if you even need to pay at all. When it comes to insulation, the R-value rating will let you know how effective your current insulation is. A lower R-value means it’s less effective and less efficient, which could mean you’re spending more on energy bills than you need to.
In that case, improving your insulation is a quick and easy way to reduce your energy costs. The same can be said for your windows, where thicker, more energy-efficient windows will keep your home warmer in the winter and cooler in the summer, saving you money in the long run.
Pay by direct debit
It’s important to review your utility bills and look at ways to reduce your spending. One way to do this is by making your payments by direct debit. This makes managing your bills easier, as you only have to make one payment each month that’s taken out of your account, as opposed to paying each bill individually. It also means you’ll avoid paying late fees, which can quickly add up. Another benefit of paying by direct debit is that utilities know exactly how much money they’ll receive each month, which makes it easier for them to budget. The same can be said for you, as you’ll know how much you have to pay each month.
Manage your tax effectively
As a homeowner, you may be entitled to a few tax breaks. If you’re buying a new home, you can deduct the mortgage interest you pay on your taxes. If you’re planning to renovate your home, you can also deduct the costs of materials and labour. You can even deduct the interest you pay on a home equity loan, which can be useful if you’re planning to do some renovations.
Lock in your interest rate
If you’re buying a new home, you can take advantage of a mortgage rate lock-in. With this, you commit to a set interest rate for a certain amount of time, such as six months. This means you’re guaranteed that the rate will stay the same throughout the period, even if the market changes. If you want to be extra safe, you could take out a two-year rate lock-in to make sure the interest rate stays the same. If rates go up, you’re guaranteed to get the lower rate for the first six months. If rates go down, you can potentially save a lot of money.
Conclusion
Owning your first home is an exciting and life-changing event. New bills and expenses can make it more challenging, however, so it’s important to be prepared. You can save money on household expenses by changing your electricity supplier and plan, bundling your bills, checking your insulation and windows, paying by direct debit, managing your tax effectively, and locking in your interest rate. Owning your first home is a big step, but with these tips, you’ll be well prepared to manage the added costs that come with it.