We’re once again joined by Bret Engle of "DIY GUYS” as he discusses the Value of having reserves. Maybe it’s something that you’ve been saving up for or a repair that you least expected. Either way, having an emergency fund set aside is not only good planning on your part, but can ease the cost and stress of whatever it’s needed for.
One of the most significant expenses you may incur from year to year is the cost of significant home repairs. Whether you purchased your current home as a fixer-upper in need of renovation or as a brand new build, the chances are that you will eventually need to do some sort of renovation. When that happens, you can either take on the project as a do it yourself renovation, or hire a professional to get it done for more upfront cost but less risk.
However, either way, if you are not properly prepared for the cost of home repair, you may end up with significantly more than you bargained for. Here are some ways you can prepare for the cost of a major home renovation, as well as strategies for saving your money for home repair (whether you prefer to do it yourself or hire a contractor) and how to select the most qualified and most reasonably priced contractor for the job.
Start Saving for Your Home Repair Emergency Fund Today
While you may be tempted to handle most home repair projects yourself, when you come up against an emergency repair, you may become extremely stressed. Do-it-yourself projects take time, and the tools and materials required to do the job properly may be difficult to acquire on short notice. However, you may be assuming that the cost of hiring a contractor is equally exorbitant. No matter whether a natural disaster has struck, causing water, hail, or earthquake damage, or if part of the house itself has caused the damage, like a collapsing roof or crumbling wall, it is wise to be prepared for the cost in advance. This is why you should start saving for a home repair emergency fund as soon as possible, even if your house appears to be in perfect condition. You can never be 100 percent sure that a natural disaster or some other chance incident will not take place, so it is best to be prepared.
Last year, homeowners paid an average of almost $3,000 on home repairs, with individual payments ranging from several hundred for a new faucet to just under $10,000 for massive structural or roof-related repair projects. Roofs, in particular, can be pricey, particularly if you have not maintained their quality over time. Depending on the cost of roof replacement in your area, the pitch or slope of your roof, and the quality of the materials used on your roof, you can expect to have to pay anywhere between $4,900 to $14,100 on your roof replacement.
Know What Your Insurance Policy Covers
It may be tempting to rely on your homeowner’s insurance to cover the cost of repairs. However, there are many costs that your insurance probably does not cover. For instance, electronic and appliance malfunctions due to an electrical outage are not covered by insurance, and neither are damages caused by mold, sewage backup, or anything arising from neglect or willful destruction on your part. What’s more, your insurance policy probably does not cover the damage from floods, earthquakes, landslides, and other natural disasters; if you live in a region where these kinds of disasters occur, it is wise to purchase a policy dealing with that particular incident, like flood insurance. In general, you should be well versed in your homeowner’s insurance policy’s coverage, so that you know what you will end up having to cover yourself.
Find a Contractor
To find a reputable contractor, do some research online for contractors in your area. Never hire the first contractor you talk to without getting several other options — always take into account their estimate, online user reviews, word of mouth, and your own general impression. In general, look for a mid-priced contractor with good ratings for service and knowledgeability.
Living through an emergency is stressful enough without having to worry about the cost of home repairs. By preparing a fund in advance, you can help save yourself the sleepless nights by giving yourself peace of mind when you need it.