- Households spend an average of 528 EUR weekly on home-related expenses, including mortgage, utilities, and maintenance.
- Overspending can occur due to high energy bills, water waste, frequent home repairs, property taxes, and debt.
- Energy-efficient appliances, fixing leaks, regular maintenance, tax exemptions, and prudent borrowing can lower costs.
- Additional cost-saving measures include conducting energy audits, shopping for better insurance rates, and considering downsizing.
- With proactive steps and informed decisions, homeowners can manage expenses and alleviate financial stress.
Homes are one of the most significant investments that people make in their lives. However, owning a home comes with a great responsibility. It requires time, effort, and money. While homeownership can be a source of pride and comfort, it can also be a source of financial distress. There are several ways that your home could be costing you more money than you thought. Here’s a look into the average spending of households, reasons you’re spending too much money, and ways you can deal with it.
Average Household Expenditure
It’s estimated that households spend around 528 EUR weekly on various expenses to maintain their homes. These include mortgage or rent, utility bills, repairs and maintenance, property taxes, insurance premiums, and other household essentials like groceries and toiletries.
Reasons for Overspending on Homes
There are various reasons you may be overspending on your home. Here are some of those reasons:
1. High Energy Bills
One of the biggest expenses that homeowners face is energy bills. Your heating and cooling systems, as well as appliances, consume a considerable amount of energy. If your home is not energy-efficient, it will cost you more money in the long run. One way to save on your energy bills is to invest in energy-efficient products. Replace your appliances with energy-efficient ones, switch to LED lights, and install a programmable thermostat. All these steps can help reduce your energy bills and save you money.
2. Water Waste
Every drop of water down the drain counts, and the world wastes gallons of water annually. Leaky faucets and pipes can waste a lot of water, adding up to a significant expense over time. To avoid water waste, fix any leaks immediately, use low-flow showerheads and toilets, and turn off the water when you’re not using it. You can also collect rainwater to water your plants and lawn, saving you money on your water bills.
3. Home Repairs
Homes require constant maintenance and repairs. From fixing a leaky roof to repairing a cracked foundation, these repairs can be costly. It’s difficult to predict when repairs will be necessary, but you can prepare for them financially. Save for home repairs, invest in a home warranty, and schedule regular maintenance checkups.
4. Property Taxes
Property taxes are another significant expense that homeowners face. Property taxes are calculated based on the value of your property, and they can increase over time. To reduce your property taxes, you may consider challenging your property assessment, claiming tax exemptions, or appealing your property taxes. Speak with a tax professional to learn more about the options available to you.
Homeowners often take out loans or lines of credit to make home improvements, pay for college, or consolidate debt. It’s important to remember that taking on more debt can increase your monthly expenses and financial stress. Before taking on any debt, consider if you can afford the monthly payments and if the reasons for borrowing the money are worth the added expense.
Proactive Ways to Reduce Costs
There are other ways you can also reduce costs aside from dealing with the problems above. Here are some of them:
Get an Energy Audit
Knowing how much energy your home consumes can help you identify areas where you can save money. Consider getting an energy audit to determine how efficient your home is and what steps you can take to reduce energy consumption. You can get a local domestic EPC to assess your home’s energy performance and get recommendations on improving it. It should provide a detailed report on your home’s energy usage and ways to make it more energy-efficient.
Shop Around for Insurance
Insurance premiums can be costly, but shopping around can help you find better deals. Research different insurance companies and compare their rates to see if you could save money by switching providers. Also, take advantage of discounts that insurance companies offer, such as bundling home and auto insurance or having a good credit score.
If your home is too large for your current needs, downsizing could be an option to save on expenses. A smaller home means lower utility bills, property taxes, and maintenance costs. It may also free up some equity in your current home that you can use towards retirement or paying off debt.
Owning a home is a significant investment, but it can also be costly. By understanding the average household expenditure and reasons for overspending, you can take proactive steps to reduce costs. Investing in energy-efficient products, fixing water leaks, saving for repairs, reducing property taxes, and being mindful of taking on more debt are all ways to decrease your home expenses. Additionally, getting an energy audit, shopping for insurance, and downsizing can help you save money in the long run. With proper planning and proactive measures, homeowners can effectively manage their home expenses and enjoy the pride and comfort of owning a home without financial distress.