How to Brace for Rising Home Costs: A Guide for Homeowners and Renters
Have you seen your insurance bills soaring recently? If so, you’re not alone. The average home insurance premium jumped by 21% from May 2022 to May 2023. When combined with rising housing prices, property taxes, and high-interest debt, it's easy to see why many Americans are feeling the financial squeeze. Knowing how to mitigate these costs can help you manage your budget more effectively, whether you own your home or rent.
For Homeowners
Prioritize Home Maintenance
Regular home maintenance can lead to significant savings over time. Regularly check your home for potential problems like roof damage or plumbing leaks. Addressing these issues early can prevent larger, more expensive repairs and might even lower your insurance premiums.
Adjust Your Deductible
Raising your deductible can lower your monthly insurance premiums. If you don’t often file claims, the savings from reduced premiums can outweigh the higher out-of-pocket costs if you do need to file a claim. This strategy is best for those with a solid emergency fund.
Build Your Emergency Fund
Building an emergency fund is a smart way to prepare for unexpected expenses, especially with rising home costs. At We Florida Financial, we offer various options to help you save effectively. Consider setting up a secondary savings account to keep your emergency funds separate from everyday spending. You can make the process even easier by making it a monthly recurring transfer. Our Ultra Checking account offers high interest on your balance, allowing your money to grow faster while staying easily accessible, and for long-term savings, Certificates of Deposit (CDs) are a great option.
Look into Property Tax Exemptions
Many homeowners don’t realize they qualify for property tax exemptions and rebates that can save them money. Homestead exemptions reduce the taxable value of your primary residence, while exemptions for seniors, veterans, and individuals with disabilities can further lower taxes. Additionally, energy efficiency rebates might be available for certain home improvements. Contact your local tax assessor’s office or check their website to discover available savings.
For Renters
Negotiate Your Rent
Facing a rent hike? Have an open conversation with your landlord about your situation. Sometimes, landlords are willing to negotiate smaller increases or even lock in your current rate for a longer term, especially if you have a good track record as a tenant.
Consider a Roommate
If your lease allows, think about getting a roommate or subletting part of your apartment. Sharing rent and utility costs can reduce your financial burden and provide a more affordable living arrangement while you save.
Cut Utility Costs
Be proactive about conserving energy and water in your rental unit. Consider using energy-efficient appliances and programmable thermostats. Additionally, ask your utility providers about budget billing or flat-rate plans to help stabilize your monthly expenses.
For Both Homeowners and Renters
Review and Optimize Your Insurance
Ensure your insurance policy provides adequate coverage for your home, belongings, and liability risks. Avoid being over-insured by removing coverage for items you no longer own or that have depreciated. Shop around for competitive rates and consider bundling your insurance policies to receive discounts.
By taking proactive steps and utilizing available resources, both homeowners and renters can better navigate the financial challenges of rising home costs.
