Homeowners typically spend a lot of money on their new homes. From the mortgage they have to pay the utility bills, regular home maintenance and general upkeep; these bills tend to add up to quite a pretty sum. It is therefore very understandable that homeowners would frantically search for ways to save money. Here are a few money-saving tips for homeowners on a budget.
Tips on How to Save Money as a Homeowner on a Budget
Some of these tips may not save too much money but every little bit adds up:
1. Update the Necessary Home Protection Plans
One of the most expensive undertakings around the home is repairs and appliance replacements. Repairs help keep the home in good working condition while activities such as appliance replacement could help save a great deal of money on power usage. For the most part, these expenses tend to come out of pocket for many homeowners.
That, however, doesn’t have to be the case. By updating home protection plans such as home warranties, the homeowner can actually have the peace of mind knowing that should anything happened within the insured period the protection plans will cover the expenses. Home protection plans tend to be very affordable (some running for as low as $500 a year) yet could end up saving the homeowner thousands of dollars in appliance repairs or replacements.
2. Refinance the Mortgage at a Lower Rate
Mortgage rates tend to fluctuate a lot, even several times during a single year. Homeowners can take advantage of this and refinance when the rates are much lower than what their current mortgage agreement offers. While the calculations can get a little complicated, homeowners can simply ask their mortgage provider for the figures on the kind of interest they are paying.
Take for example a 30-year mortgage plan of $200,000 going at 5%. That’s a $1,074 monthly payment. However, if the same plan fluctuated and fell to 4.5% interest rate, that would be a $1,013 monthly repayment over 30 years. While a 0.05% drop in interest rate might sound tiny, it really does accumulate into substantial savings over the 30 years. The borrower will pay total interest of around $187,000 over the 30 years with the 5% interest rate while they could simply pay $165,000 with the 4.5% interest rate over the same period of time. That gives the homeowner a saving of $22,000 overall.
3. Rely on DIY as Much as Possible
Homeowners who DIY their way through most repairs and maintenance chores around the house tend to feel more rewarded by the actual work itself and also save money. One good way to DIY something is to give the most heavily used appliance (the microwave) a good cleaning without needing to spend money on special cleaning products that might cost a pretty penny.
One way to do this is to simply put some water in a bowl, squeeze a bit of lemon in it and let that water boil inside the microwave while it’s on high for about two minutes. The steam from the lemon juice and water will stick to the interior of the microwave. By simply wiping it down, the microwave will be thoroughly cleaned and smell rather fresh. This is just one example of how new homeowners can save money using DIY methods.
4. Save on Energy Bills with a Few Tricks
During the winter, cold air tends to creep in through the tiniest of gaps around the windows. This forces heating systems to work even harder to keep the home warm and this tends to drive up the energy bills during this period. The same applies to the summer when the cool air from within escapes through the same cracks thus forcing the cooling systems to work much harder to maintain favorable temperatures within the house.
One of the simplest tricks to help save money here is to seal those cracks with window and door-sealing tape or caulk. This will help insulate the home and make it a bit more energy-efficient thus cost more in terms of the electric bill.
5. Power Strip the House
There is something called “phantom power drain” that most homeowners never really think about or even consider. Whenever the myriad of appliances in the house such as TVs, gaming consoles, coffee makers and such and plugged into the wall, they use a small amount of power even when turned off. This phantom power drain, even though it might be minimal, adds up over time.
The best way to deal with it is to ensure that all the appliances are plugged directly into the wall but via a power strip. This way, whenever they aren’t in use, the power strip is switched off and therefore no phantom power drain.
It’s all in the little things that homeowners do around the house to save money. Every little bit counts and over time it adds up to a sizeable chunk of change. The tips shared here should help new homeowners get started with this process and as time goes, they tend to figure out different ways to save money as they apply their own specific situations to the problem.
