Keeping the Keys: Safeguarding Your Finances

Keeping the Keys: Safeguarding Your Finances

By Michael Haynes,

Supervisor, HomeOwnership Center

You have just closed on your property and now have the keys… what next? 

The homeownership process does not end with the closing!  

The buyer’s focus prior to closing on a house is on the management of transactions and documents to ensure that ownership legally passes from seller to buyer.  After the closing and the ceremonial passage of the keys from the seller to the new homeowner, the focus shifts to property management and financial sustainability. 

A strategy for addressing home maintenance issues and personal emergencies while protecting all assets becomes extremely vital to your ongoing financial well-being. Consistently saving the appropriate amount of funds will put you on the right track. However, merely saving a random amount of funds each pay period or per month may not ensure that you are financially capable of covering home maintenance issues or an emergency.  In addition, not paying attention to appropriate protective measures necessary to safeguard your real estate assets can create major financial hardships.  

The concept of home maintenance is extremely important to the homeowner at every stage of the home buying process. When deciding to buy a home, the buyer is trying to assess the current home maintenance needs. In addition, the buyer is also trying to use the home maintenance issues that may already exist as a leveraging tool to see if the seller will cure the issues prior to closing. As a homeowner, you are responsible for the upkeep of the property. You will want to understand the preventive measures necessary to ensuring the optimal functionality of the property. Become familiar with these preventive measures and be aware of potential issues before they happen. Educate yourself on the cost, life expectancy, and age of the property’s roof, windows, and mechanical structures. You will want to use this information to develop a savings plan for addressing repairs and replacements.

Personal emergencies should always be thought of as a separate category despite the urge to lump them in with home maintenance. Home maintenance funds should be used strictly to address property issues. An emergency fund is used to address issues such as a flat tire on your way to work or an unexpected medical expense not covered by your health insurance. Increasing your emergency funds will help to minimize the likelihood that you will be wiped out financially by unexpected life events.

Protecting your real estate asset does not just include obtaining the proper insurance and taking the proper home maintenance precautions.  Make sure that you always keep a copy of all loan documents signed at closing and your homeowners’ insurance policy. You may want to keep these items in a fireproof safe to ensure that they will be properly maintained even in the event of a fire.

Home maintenance, emergency funds, and asset protection are crucial components to the sustainability of your property and your finances. Make sure that you treat them as priorities.

NHS can help you create your homeownership strategy. Give us a call today at (203) 562-0598 ext. 26, or check us out online at www.nhsofnewhaven.org.