Reduce expenses and stress levels with careful money management
It’s well known that moving home is an expensive and potentially stressful time; managing your finances efficiently will both help you avoid spending more than you should and help reduce stress levels.
There’s more to managing home finances than checking that you meet the mortgage payment each month; associated costs can add considerably to the financial burden and managing them successfully can lead to considerable savings.
Here are some ideas to manage finances:
The true cost of moving
In the same way you’d have established how much you could afford for your new home by way of purchase price and mortgage payment, similarly you should know your other moving costs.
The overall sum can run into the thousands quite easily; it’s often underestimated in the excitement of finding that dream home.
• Solicitor and surveyor fees - these must be factored in to receive accurate quotes.
• Stamp duty - will you be liable for this? If so, it can add considerably to moving home costs.
• Storage and removal - perhaps you’re putting items into short- or long-term storage and hiring a removal company. How much will this cost?
• Selling your existing home - if you’re selling a property as part of your house move, then costs will be incurred such as estate agents’ fees. Professionals such as these will inform you exactly what your fee options are.
• Preparing - factor in the amount of money you may spend preparing your home for sale (minor redecorating, a deep clean).
Perhaps some of these costs can be reduced; for example, hiring a van and paying a couple of friends or acquaintances would be cheaper than engaging a removal company.
Ask yourself if you can meet these moving costs from funds available or whether you’ll require a loan; if so, shop around for the best deal and factor in the repayment costs.
Moving home is a good time to review your regular outgoings and check if you’re getting the best value in services such as home phone, broadband, energy and home insurance.
If you’re selling, ensure your existing energy suppliers return any money they may owe you when you end your service (unless you’re deciding to continue with them in your new property).
When checking out the market, use a good comparison site to compare energy and other suppliers.
Maintain your credit rating
Moving home can, if you’re not careful, affect your credit rating. For example, forgetting to be added to the electoral roll in your new area can affect credit as potential lenders check to see if you’re registered to vote for basic credit checking and fraud prevention.
Review credit cards; any older ones still lingering may be best closed as too many lines of credit can adversely affect your rating.
It’s worth checking your credit report to ensure no errors have crept in that may affect your score; ask the major credit reference agencies Experian, Callcredit and Equifax for a copy of your credit report.
Review and adjust your budget
Moving home inevitably alters your financial outgoings both positively and negatively. For example, your mortgage may have increased but perhaps your commuting costs have reduced?
Either adjust or, if you haven’t already got one, draw up a simple budget and keep track of regular outgoings to see the ‘state of play’ and perhaps find ways of reducing costs.
Check your finances and give them an overhaul while you’re at it: check your direct debits to make sure you’re not spending money unnecessarily such as on subscriptions you don’t make the most of.
Review any existing debts such as a loan or credit card balance and see if you can save money; for example by transferring a credit card debt onto a 0% balance transfer you’ll avoid interest payments over a period so you can focus on paying off just the outstanding balance.
Any old pensions from previous jobs? Investigate whether these can be consolidated into one overall pension.
Investing in your new home
Don’t be in too much of a rush to replace everything when you move; it’s tempting to wish to make a totally fresh start in a new home with new furnishings and maybe a full redecoration, but ensure you have the funds available and take the time to ensure you’ll be getting the best value.
For example, while ditching the old furniture and buying new might be attractive, maybe your old items could still ‘work’ in the new home with some minor renovation? New coverings for the three-piece suite are much cheaper than buying a replacement.
With decorating, if you’re thinking of employing a professional, check quotes and take time to hire the right people.
Don’t get caught out; keep a contingency fund for those ‘just in case’ eventualities such as a boiler repair or plumbing.