Are you buying a house soon? Experts suggest keeping as much aside for repair costs

While many people dream of homeownership, owning a home is a big responsibility. In addition to preparing for the costs associated with buying a home – like a large down payment and closing costs – you should also consider the ongoing expenses you need to pay.

In addition to your monthly mortgage payments, property taxes and home insurance costs, you need to plan for other expenses related to maintaining your property.

Regular maintenance and repairs are necessary to keep your home in good condition. Before purchasing a home, find out how much you should set aside for repairs and maintenance.

Allow 1% to 2% for repair and maintenance costs

Many experts suggest setting aside 1 to 2 percent of the home’s purchase price annually for ongoing home maintenance and repair needs. Some even suggest saving up to 4%. You’ll want to put money aside each year so you can take care of your home.

If 2% seems like a lot to you, start with 1%. Saving money is better than nothing at all. Let’s say you want to purchase a $275,000 home and plan to start saving on repair and maintenance costs by saving 1% per year. You would like to set aside $2,750 each year.

Some regular maintenance tasks include cleaning gutters, inspecting the HVAC system, maintaining the lawn, and replacing air filters. Examples of home repairs include plumbing issues, water heater replacement, and HVAC equipment replacement.

Even if you only spend a portion of what you’ve saved, you’ll be happy to have money available when a more expensive expense arises, like a new roof. According to the International Association of Certified Home Inspectors, the average life expectancy of an asphalt shingle roof is 20 years.

Many homes have asphalt shingle roofs. Replacement costs vary depending on labor, height and slope of the house, and square footage. But according to Architectural Digest, most homeowners will pay $11,500 for a 1,500 square foot roof.

The best strategy is to get into the habit of saving on home repair and maintenance costs.

Earn interest while saving on maintenance costs

Whether you’re already a homeowner or planning to buy soon, it pays to set aside money for repairs and maintenance on your home. Having money in your savings account before paying a repair bill or purchasing supplies for routine maintenance can give you greater peace of mind and help you stay out of debt.

Where you keep your savings is important. If you keep it in a checking account, you won’t earn much (if any) interest. Instead, consider keeping it in a bank account that earns interest so your money can grow over time.

Want to maximize the interest you earn on your home repair savings fund? To reach your savings goals faster, consider the Discover® Online Savings Account, which offers an impressive 4.10% APY. Click here to learn more and open an account today.

Earn rewards to grow your savings account balance faster

Looking for a way to earn more money to fund future home repairs? You can earn money by using a cash back credit card to pay for everyday purchases. Check out our list of the best cash back credit cards to see how easy it is to earn cash back.

Cash back apps offer another way to earn rewards when you shop. Tools like this can help you set aside more money to maintain your home simply by maintaining your usual purchasing habits.

Are you considering giving up renting to become an owner? It may seem attractive to not have to pay high rental fees or deal with a landlord. But you will be responsible for maintaining your home and paying these costs. Do what you can to plan accordingly for all costs of homeownership, including future expenses like home repairs and maintenance.