Whether you're paying the mortgage and insurance, keeping up with repair needs, or making your house cozy and livable, you're probably spending a healthy chunk of your income on your home. Answer these questions to figure out whether you can bring your home expenses down.
- Can you lower your homeowners' insurance rates? Don't just sign off on your policy when it's up for renewal. Talk to your insurance broker about whether the coverage amounts are appropriate, how much you'd save by raising your deductible, and whether you might qualify for any new discounts. If, for example, you've added a home security system, have switched to using the same company for auto insurance, have stopped smoking, or are at least 55 years old and retired, you might qualify for substantial discounts.
- Is now a good time to refinance your mortgage? If interest rates have dropped substantially, or your credit score has gone up, since you got your mortgage, you might qualify for one with lower interest and otherwise better terms. But refinances come with upfront costs, so make sure it's really worth it, by following the advice in Nolo's article Refinancing Your Mortgage in Today's Market.
- Do you have enough home equity to cancel your PMI insurance? If you put down less than 20% when you bought your house, chances are you're paying PMI insurance. But you don't have to pay it forever -- a fact that your mortgage lender might neglect to tell you -- as described in Nolo's article Getting Rid of PMI (Private Mortgage Insurance).
- Are you eligible for any home-related tax breaks? These change every year, so check out the latest in Homeowner Tax Breaks: Recent Developments.
- Can you reduce your energy consumption? Hanging laundry outdoors won't cost you a thing upfront! Other steps might require some advance investment, but will pay off quickly, as described in Nolo's article Go Green At Home, Save Money.
- How about creating sharing arrangements with the neighbors? Whether it's swapping tools, plant cuttings, or services, neighbor shares are a trend that's both economical and good for community. You'll find all the details you need, including advice on how to avoid legal disputes, in The Sharing Solution, by Emily Doskow and Janelle Orsi.
- Do you really need all those subscriptions? Magazines, cable, and other subscriptions can eat up a surprising amount of your budget -- which is okay if you're really using them. In some households, however, no one notices when they continue paying the bills for services that they're not really using. Ask around your house.
- Is your house vulnerable to theft? Crime may not be costing you any money now, but could be expensive if it happens. Take a walk around the house, pretending you're a burglar. Would simple tree trimming remove some entry points? Is there a neighborhood watch group you can join (or start)? You might also want to invest in deadbolts or an alarm system. And learn how to prevent identity theft in the Identity Theft category on Nolo's website.
- Can you nip any other problems in the bud? Do a regular look around your house -- including the basement, attic, and foundation -- for signs of termite or other pest damage or rot, or roof leaks. Have problems attended to while they're still small.
For further guidance on all aspects of owning a home, see The Essential Guide for First-Time Homeowners, by Ilona Bray & Alayna Schroeder (Nolo).