Congratulations on your new home! Your first year of homeownership should be an exciting one, filled with making your house a home and getting settled in.
Unfortunately, some first-year homeowners jump the gun and bite off more than they can chew, leading to financial difficulty. To make the most of your first year of owning a home, avoid these five mistakes:
Not Having A Safety Net Or Plan
One of the top mistakes first-year homeowners make is not have a safety net or plan. Life is full of unexpected events, from divorce, illness, and natural disasters. A safety net and plan will allow you to avoid draining your savings, and a plan will help you avoid unexpected costs.
Even a good home warranty or home insurance can’t cover every scenario, so it is good to be prepared.
Making Large Lifestyle Changes
After you purchase your home, you want to avoid making large lifestyle changes like changing your job or getting a pet. With the additional expenses of a home, you want to get used to the new responsibilities of being a homeowner before any significant changes.
Putting Off Small Fixes
If something in the home needs to be fixed, like that little crack in the ceiling plaster, get it fixed sooner rather than later. Many homeowners make the mistake of putting off small fixes thinking that they’ll get it done later or it’s “not a big deal” right now.
When that small fix becomes a larger issue, first-year homeowners can find themselves saddled with a much larger bill.
Not Keeping Receipts
Throughout your years as a homeowner, keep every receipt related to your home. This includes repair bills, insurance receipts, and bank statements. These documents are critical if you want to refinance your home or need proof that a purchase was made.
Not Taking Advantage Of Tax Breaks
As a homeowner, you can take advantage of many tax breaks like mortgage interest deduction. These breaks can take the form of deductions on your taxes or tax credit on your tax returns. Work with your financial counselor and tax specialist to determine what tax breaks you are eligible for.