A. For young couples who just bought their first home, here are a few actions need to take to ensure a smooth process down the road:
1. Set up automatic payments.
This includes mortgage, utilities, HOA, etc. So you don't forget any of these payments as any delay carries significant consequences.
2. Budget maintenance costs.
It's wise to budget 1% of home's purchase price each year for upkeep. So, for a house bought for $300,000, it probably takes $3,000 to cover expenses related air filter replacement, furnace repair, sprinkler system fix, etc.
3. Check your insurance policies.
Make sure you understand what your homeowner's insurance policy covers. For example, if a tree falls during a storm and takes out the shed in the yard, will your policy cover it? You need to read all the fine prints in your policy.
Also now it's time to make sure you have adequate life insurance coverage for your current situation. But don't overbuy life insurance, a simple Term life is more than enough for most families. Contact us if you want to get the lowest rate from a reputable insurance carrier.
4. Build an emergency fund.
Your emergency fund should cover around 3-6 months' expenses, including mortgage payment, utilities, cable, phone bills, etc.