What Is Your Contingency Fund For?
Buying a home is one way to invest in your future. But as any homeowner knows, the cost of buying the property doesn’t end when we get the keys. In fact, that’s just where it starts.
Maintenance work comes with the package of owning a home. Some elements of the work we choose to do, while others are simply in the hands of fate - in other words, unexpected costs that are easy to be unprepared for.
Having a contingency fund is one way to help pay for maintenance costs, without dipping into savings or the money that covers other expenses.
But what could a contingency fund be used for? While the list definitely doesn’t stop with here, here are a few key items for which a lot of homeowners are glad they had their contingency funds on hand.
Appliance repair
Appliance maintenance and replacement is something that’s a case of ‘when’, not ‘if’ in your home. Even brand-new appliances can start to show signs of wear after a couple of years, and may need some repairs to keep them going. When you have savings to dip into, appliance repair doesn’t have to be such a shock to your finances. Inspect your appliances regularly and look out for signs of a problem. Catching an issue early can mean fixing a problem before it becomes a major one.
Wear and tear due to weather issues
Unfortunately, the weather is something that is difficult to predict, as is the potential damage wind, rain and excess heat can cause. Making summer home repairs after the winter months is something you can expect to deal with every year to make sure leaks and damaged structures are dealt with. Severe weather incidents can also cause significant and unexpected damage, so it’s good to have some money set aside to cover those emergency repairs.
Water damage
Water damage can happen for a number of reasons. Broken plumbing, flooding and accidents in the home can all lead to water damage that could leave you needing some costly repairs. Dealing with water damage quickly could help reduce its impact, rescuing your surfaces and furniture before things get worse. While some elements of water damage can be covered by your insurance, having emergency savings could come in handy if you find yourself needing urgent repairs.
Pest control
Nobody likes an unwanted visitor, so if you discover pests in your home, it’s important to get rid of them as soon as you can. Calling in pest control to tackle problems like termites, cockroaches and even animals like raccoons can come with a hefty bill. While you may want to tackle these issues yourself, professional pest control can ensure the job gets done and stops pests from returning to your home.
When you first move into your home, your mind can be focused on all the jobs that need doing to make it more homely. Having some money set aside for inevitable maintenance work can help ease the financial pressure and stress, allowing you to continue with your home improvements. If you haven’t already started a contingency fund for your home, start putting money aside now and feel safe knowing those home emergencies are taken care of.
