How to plan for home upkeep and appliance replacements to minimize financial challenges. 

What’s one of the biggest surprises for new homeowners? The price of repairs and upkeep. Unexpected expenses can quickly derail any budget. To minimize financial challenges, money-savvy homeowners plan ahead for their home’s needs. The start of a new year is a good time to put a savings plan in place.

How long do appliances last?

Depending on product quality and usage, large home appliances like refrigerators can be expected to last eight to 15 years. The older the appliance, the more likely it is to need repair or replacement.

Assess your home’s appliances to see what might need replacement in the next five years. Decide if you want to replace an appliance before it fails. There’s relatively low risk with a non-functioning dryer but a broken down fridge can result in the loss of food and create big hassles.

What’s the age and condition of structural elements and systems?

There are some conditions around the house that get daily attention, like cleanliness. However, many things are “out of sight, out of mind”, like roofs and the HVAC system—until something goes wrong. Consider the age and condition of your home’s structural elements and systems to plan for repairs, upgrades, or replacements.

Even if you have a new home it’s important to plan ahead. For example, 3-tab shingles, the cheapest roofing option and therefore widely used, may only last 15 years. Climate and conditions like the ventilation effectiveness influence a roof’s longevity. A poorly ventilated roof will greatly decrease a roof’s lifespan.

If you don’t have the know-how to assess your home’s condition, consider a home maintenance inspection. A knowledgeable home inspector can help identify possible problems with everything from the plumbing and electrical systems to the foundation and chimney. Their expertise can help you plan for upgrades and replacements, as well as guide you on how to make what you have last longer.

If you recently purchased your home, the inspection report made before the transaction closed can help determine the useful life remaining for structural elements and systems.

Are there exterior items that need attention?

Some exterior things deteriorate so slowly it’s easy for a homeowner to miss them. A tree limb that’s grown and now hangs over the roof. Driveway cracks. A sagging privacy fence. Many of us suffer from this kind of blindness. Walk your property with fresh eyes and note anything that needs attention.

Devise a savings plan

Once you have a clear idea of your home’s upcoming needs devise a savings plan. Let’s say you identify a 14-year old fridge and dishwasher that’s making a grinding noise. If you budget $1,000 for the fridge and $500 for the dishwasher, that’s $1,500. To save enough to replace both in a year, plan to save $125/month ($1,500/12 months).

For big-ticket items like roofs, which can easily cost $10,000 or more, it’s helpful to look even further into the future. For example, if the roof’s remaining life is five years, a savings plan put in place now can reduce the financial hit when it’s time to replace it. To cover a $10,000 roof, putting $167/month into a savings account will get you to your goal in five years.

When expenses occur before you’ve saved enough

Even the most conscientious planners and savers experience home repairs that require more cash than they have on hand. Homeowners can tap into their home’s value with a home equity loan that provides cash right when they need it.

 

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