Six Budgeting Tips to Prepare You For Home Maintenance Disasters*

*This is a collaborative post*

If you’ve ever had your fridge break on you, or you’ve discovered a leak in your plumbing, you’ll know that having to perform emergency repairs on your home can be really expensive.

These tips will help you prepare for unforeseen costs, so you’ll be ready to whip that wallet out when the need arises.

Choose Your Approach

Even if you’re good at budgeting for other household requirements, emergency repairs are their own category of expense. Firstly, you never know when you’ll have to shell out for a pricey repair or replacement. Secondly, you don’t have a choice about when to get the repairs done: if water’s raining down from your top floor bathroom, you have to call that plumber in YESTERDAY. Bearing this in mind, it’s worth acknowledging that you have two options when it comes to preparing for unseen expenses. The route you favour will depend on your current financial position.

Firstly, you can do your best to budget ahead of time for unexpected events by putting into place useful strategies for saving. However, that does mean you will cut into your budget every month for other aspects of your home life, and you may not feel willing, or even able, to do this. Your other option is to make use of same-day loans when you find yourself in a fix. As long as you’re confident you can pay the money back in a timely manner, debt collection won’t be an issue for you. This option means you can devote your full budget to other areas of your housekeeping, and even save towards updates to your home.

Know What You Could Afford Today

Before you start creating your emergency fund, it’s useful to know how much you can afford to pay if you had a home disaster today. Say your washing machine broke today and you needed a replacement. How much money could you spare towards the issue today? If the answer is, ‘none! I need all my money for groceries!’ then you know your starting point: you need your emergency fund to be large enough that you don’t have to dip into your monthly earnings. If you could spare a couple of hundred pounds, then you know your emergency fund can be a little slimmer—basically, just enough to top up your monthly earnings, if something expensive crops up.

Sell Stuff You Don’t Use

Starting an emergency fund from scratch can feel a little intimidating. One of the best ways to give your emergency fund a head start is to sell some stuff you have that you don’t use anymore. While you might think nobody would want to buy the things you don’t want, remember that one person’s trash is another person’s treasure. That tennis racquet you haven’t used in a while is worth nothing to you while it’s stashed in the attic, but once you’ve listed it on eBay, it could take on value you forgot it had. It can also be freeing to get rid of possessions that you don’t use anymore, especially if they no longer bring joy to your life. While each item you sell may not be worth all that much on its own, you’ll be surprised how much it adds up to once you’re finished your purge. Your emergency fund should be well on its way!

Evaluate Your Existing Budget

If you already run your spending on a tight budget, you may not think you have much to spare, but take another look. You may find that you’ve changed your priorities since you first established your budget, and you can make a snip or shift here and there to save a little money. For example, do you still appreciate that weekly trip to the nail salon? Maybe you’re a little over having glam nails, but you still go out of habit, and because you love a good chat with your beautician. Or maybe you don’t need therapy anymore because your mood has improved, but you just hadn’t noticed yet. If you’ve started getting into cooking lately, maybe you don’t get as much pleasure out of eating out on a date night as you do from cooking something special. In that case, cut your restaurant budget and enjoy an intimate date night at home. A couple of adjustments could add a decent bit of cushioning to your emergency fund.

Don’t Get Stuck in a Rut With Bills

Monthly bills are a good place to start when you’re looking to cut expenses. Give the service providers for your T.V, Internet and mobile phone service a call, and ask if they have any more cost-effective options available for you to switch your contract over to. You never know: since you signed up, they may have introduced new deals or service bundles that offer exactly what you need for less than you are currently paying. A couple of tweaks to your monthly bills could go a long way.

Open a Separate Account

As you watch the money in your emergency fund grow (which it will!) it can be tempting to use it for other things. What use will it be then? The best way to combat this is to open a separate account for your emergency fund, rather than stashing your cash under the bed or even ‘knowing’ how much of the money in your account is set aside for emergencies. Allocating the money to a savings account means your emergency funds are ‘out of sight, and out of mind’, removing the temptation to splurge and ensuring you have access to the extra money when emergency strikes. Another great benefit of having the money in a savings account is that you will accrue added interest while it sits there, swelling your emergency fund even more.

Whether you own your own home or not, you may have occasional emergencies that require a dose of extra cash to put right. Even if you don’t have extra money lying around for emergencies, a household disaster generally cannot wait. These tips will help you ensure that you have the money to hand, avoiding panic and disorder.

*Contributed by Sam Jones. Header image source: Pexels CC0 Licence Second image source: Pexels CC0 Licence

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