As a new homeowner, one of the first important tasks to accomplish is making a budget for home expenses. The homebuying process had a budget, but now it’s time to think about taking care of your home and enjoying it to the fullest.
To help you get started on making a household budget, here is a basic guide:
Identify your goals
Deciding on financial goals can be an excellent way to build your budget. Some examples of financial goals to consider might be paying off your mortgage early or financing a major renovation project.
List your expenses
Track your spending habits for a month to examine the details of your cash outflow. Include fixed expenses, like monthly mortgage payments and property taxes. Variable expenses like entertainment, maintenance and transportation costs should also be included.
Record your earnings
Figure out your exact income amount by listing all possible sources of money. This could include regular employment and also gains from selling or renting assets. For budgeting, use your net monthly income rather than gross monthly income to account for taxes.
Find your starting point
Once you have your total monthly expenses and net income numbers, you can do the math. A basic formula for finding a starting budget is: net income - total monthly expenses = monthly budget.
Expect adjustments
After finding your results, you may find opportunities to adjust. For example, you might want to set aside more money into an emergency fund regularly, or find ways to limit your daily spending.
These are only the first steps in creating a workable household budget to account for ongoing costs of homeownership. Use this process as an example for building your own personalized financial plan for your life in your new home.
About the Author
Hannah Sosinski
I started my career in the real estate industry at the age of sixteen and instantly fell in love.
I worked alongside one of the top producing agents in the country as their administrative assistant for nearly nine years before I took the leap to begin my own journey in the real estate industry.
Working alongside an agent who sells over three hundred houses a year educated me strongly on the Pittsburgh and greater Pittsburgh housing market. While working alongside this agent, I was lucky enough to be involved in several different types of real estate transactions and learned to properly determine home values, many aspects of negotiations and have learned how to close challenging deals while also handling a large amount of deals at the same time.
I have also spent the past seven years working as a property manager throughout Allegheny, Washington and Fayette County. I have managed everything from Section 8 to Luxury units.
Exploring the options of the real estate industry can be overwhelming. While working with me you’re able to sit back and relax as I have worked with many investors, home sellers and buyers and can help guide through the sale or purchase of your home and make it as easy on you as possible.
Whether you’re a first time home owner, downsizing, sizing up, looking to make your first/second or third investment, selling your home, etc. I can use my years of education to help guide you through the purchase or sale of the largest investment of your life.
I look forward to chatting about real estate with you!