Planning for home expenses

The worst aspect of homeownership is the continual parade of unexpected expenses — a headache made more specific in this article about planning for expenses that will arise when you buy a home.

Looking at homeownership as this article does makes it plain that the “unexpected” expenses really aren’t unexpected — just unplanned and significant.

I disagree with some of their time frames:

WHAT WILL IT COST TO REPLACE?

Life Expectancy
(Years)
Replacement
Cost*
Set-aside
Monthly
Roof 10 $2,524 $21.00
HVAC 13 $5,461 $35.00
Refrigerator 6 $820 $11.39
Oven 6 $984 $13.66
Washer 8 $591 $6.16
Dryer 8 $535 $5.57
Exterior paint job 6 $4,100 $56.94
Windows 15 $15,002 $83.34
Doors 15 $6,876 $38.20
Driveway 9 $4,802 $44.46
Heater 8 $1,013 $10.56
* Current cost plus 1.5% annual inflation over life expectancy.
Source: Askthebuilder.com.

Perhaps we were just fortunate, but at our previous home the furnace was 27 years old and going strong. I believe our current furnace is somewhere in the 15-20-year range and operating almost flawlessly (we’ve had one minor, easily fixable problem in three winters of use). So eight years before replacement seems a little high. I’m not so sure about a new refrigerator every six years, either.

But the monthly set-aside is a great concept. If nothing else, it is probably wise to add to your emergency fund by a middling amount, so that you have some kind of cushion if a major cost arises.

Next year, we’re looking at replacing a driveway and possibly revamping our back yard landscaping. But I’m not yet sure what it will cost – or how we’ll pay for it.

In the past, we’ve typically done a combination of saving for and sucking up big home costs. We took a home equity line at our old house to replace the windows, which paid for itself when we sold the house (the windows were a good selling point and increased our insulation and therefore comfort, too).

Now, odds are good that it’s time for us to create a real savings strategy to pay for home expenses — along the lines of the Christmas, tuition and camp monthly savings accounts I started in January.

How do you handle home expenses?

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One thought on “Planning for home expenses

  1. L'an says:

    Uhh… wishful thinking? We’ve usually handled this through some combination of raiding our general “emergency savings” and relying on an equity line of credit. But you’re right: these are expenses that will come up at some point, so you may as well be prepared for them.

    That said, I agree that some of the numbers seem off.

    Having had to replace a roof before (on a teeny house!), that estimated cost seems unbelievably low (but perhaps that’s the cost for adding a new layer of shingles, as opposed to removing everything and starting fresh?)

    The only reason I can see why you’d need (want) to replace your fridge that quickly is because the energy efficiency of refrigerators tends to improve quickly, but again, the cost of the new wouldn’t necessarily outweigh the energy expense of the old.

    What’s not listed (and I think should be) is replacing a water heater. Those seem to need repairs or replacement on a pretty consistent basis (or maybe that’s just our bad luck? )

    Maybe more important is to think of this not so much as “saving the money to replace it outright” which does seem ludicrous in some cases, but “saving money to patch it up and keep it running.” In any event, making “irregular home expenses” a regular line-item in the budget would be a vast improvement on how we’ve handled this thus far…

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