Saving for a Vacation Home: How Seniors Can Plan for the Financial End of Things

Vacation Home

Saving money for a vacation home can be difficult, and when you’re a senior on a fixed income, it can take some creative thinking to make sure you have the funds you need for the perfect getaway. Not only will you need to think about saving for a second mortgage, you’ll also need to consider the extra costs that you’ll incur from taxes and furnishing your new home. Then you’ll need to think about whether you want to turn your vacation home into a rental property when you’re not using it in order to recoup some of your investment.

A good financial plan begins with educating yourself about the real cost of a vacation home. Think about what it will take to make your dream a reality. Of course you’ll need money for the down payment, but you’ll also need funds to cover all the extra costs that come with a home, such as property taxes, utilities, HOA fees, and insurance, just to name a few. The location is a huge factor not only in cost, but in convenience, as the ideal vacation home is far enough away to be a “getaway” but close enough to your home that you can manage the upkeep.

Read on for some tips on how to plan for your vacation home and get everything you want out of it.

Location is key

The perfect vacation home means different things to different people. You may want something near the beach, near a ski resort, or in an area that has lots of restaurants nearby. You might want a home that fulfills needs for your health and well-being, such as a floor plan that works well for individuals with limited mobility. Take into consideration your lifestyle, your budget, and how often you’ll be using the home when you start your search, and gather some info on what the neighborhood is like as well.

Calculate well

Budgeting for something as big as a vacation home means doing some heavy planning. You need to make sure you’re familiar with all the rules of the area first, as some cities, homeowner associations, and resorts make their own set of laws when it comes to properties and amenities. Talk to a real estate agent and an accountant to get a good idea of what you’ll need to set aside.

Don’t forget the upkeep

Vacation homes often need updates when it comes to the kitchen and bathrooms, and these improvements can be pricey if you’re not careful with your budget and planning. One of the best ways to keep your home in good shape is to keep up with repairs and small changes rather than waiting to do them all at the same time. If you’re fairly close to your vacation home and can make a few trips a year for maintenance and upkeep, it will likely save you quite a bit of money in the long run. HomeAdvisor states that the average cost to remodel a kitchen is between $16,348 and $38,800, which is a big chunk of change. However, making green improvements, such as installing energy-efficient appliances or solar panels to the roof, can help you with tax credits as well as save you money on utilities every month, and that’s a great place to start with your budget.

Consider renting it out

While there are certainly downsides to renting out your vacation home, there are many upsides, too, including the fact that you’ll be getting extra income to help pay the mortgage. You’ll need to check and make sure this is an option before buying your home, as well as think about whether you’ll be available for emergencies should something go awry when the renters are in the home, but many vacation homeowners find this to be a great way to balance out the cost of the house.

Saving money for a vacation home starts with a solid plan, so make an effort to consider all your needs before you begin the process. Talk to your family about your plans and garner support and help from your loved ones to help make everything go smoothly.

 

 

 

 

 

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Your Home is Your Greatest Asset – How to Protect

houseYour biggest investment is likely your home. You can protect it – in ways that go beyond staying current on the mortgage.

A home is more than a financial investment. It is an emotional investment. The feeling of owing your dream house is the experience of a lifetime. You relish having something that’s all yours – a place where your own style statement tells the world who you are.

If you are a cash-strapped consumer, debt relief must be your first step to secure this prize. Pay down your home loan, with the goal of being debt-free.

Beyond that, however, hazards lurk that are not strictly financial. They are physical. Failure to protect against them can turn your dream into a nightmare. Only through careful consideration of threats and a systematic approach can you protect your home.

There are three crucial areas to focus on: access control (security), fire prevention-response and maintenance.

Access Control. Break-ins are down in the U.S. by 3.7% last year, the latest in a multi-year slide, according to Justice Department statistics. Nevertheless, in terms of raw numbers, burglaries and home invasions still happen often.  By the tabulations from Safeguardtheworld.com, using federal numbers, 2.5 million break-ins occur annually in the nation or one every 13 seconds.

Keeping out criminals and other unwanted persons is very important. Security measures, from locks to alarms, determine who has access to what and when. They range for sophisticated to traditional, from door handle locks and deadbolts to electric or magnetic locks. You also can protect the home with adequate lighting system, near entry areas, to dissuade burglars from busting in. Then there are alarms, which alert the police or security companies that intruders are on the premises.

Crooks aren’t the only ones to worry about. Babysitters and maintenance people also have combinations for your alarms and locks because they have legitimate business in your house. But they won’t work for you forever. What if they – or someone they know – later look at your home as a target?

Keep changing your lock codes frequently in order to prevent a wanted guest from becoming an unwanted one later.

Fire Prevention and Quick Response. Fire is the single largest cause of property loss in the United States. The National Fire Protection Association says that, in 2013, the nation had 487,500 building fires, causing 3,240 civilian deaths, 15,925 civilian injuries and $11.5 billion in property damage.

Property insurance pays for replacing or repairing fire damage. But the better idea is to stop a fire from spreading and seriously harming your dwelling. Alarm systems linked to fire departments or security services are a big help, especially when you are away. In addition to smoke alarms, consider installing carbon monoxide sensors in the home, and heat sensors in the attic, as well. It gives an alert to dangerous heat levels in the home.

Maintenance. Little things can get out of hand: mildew, termites, drainage. Your house must be maintained from time to time to bolster its value in the market. It’s good to fix problems sooner rather than later.

You can arrange sprinkler systems to ensure proper landscaping and water consumption. Master control computers can remind you of repetitive maintenance, such as when to clean gutters and change HVAC filters.

Your home is your castle. But it needs a good moat.