Author Topic: Just Bought a House - Any Advice?  (Read 3207 times)

debtfreejess

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Just Bought a House - Any Advice?
« on: November 10, 2018, 12:23:19 PM »
Life Situation: My fiance and I are 28 and 24, respectively, and just purchased our first home in the suburbs around Los Angeles, CA. We’re feeling typically “house poor”, but are doing okay generally. However, we have a lot of things coming up in the next couple years and I want to be saving for retirement/FIRE, so turning to the Mustachians for advice to further economize and strategize.

Gross Income:

Me:
$60,000 - base salary (promotion in the next couple weeks - will increase to about $60-65k)
$4,000 - bonuses
$1,000 - YouTube channel and minor side hustles
Total: $65,000

Him:
$58,000 - base pay (hourly at $29/hour)
$4,000 - estimated OT
$1,000 - minor side hustles
Total: $63,000

Total for both: $128,000

Deductions:

Me:
401k: $9,000/year (15% of gross - about $350 every two weeks)
Health/dental insurance: None (under 26, still on parents’)

Him:
Pension: Unsure of the amount, I think it’s maybe 6-8%
403b: $100/month
Health/dental insurance: $0 (fully employer paid)

Monthly Snapshot

Monthly take home: $6000 (this is absolute minimum with no bonuses, OT, etc.)

Mortgage + PMI: $2166.06
Taxes & Home Insurance: $600
Electric/Water/Sewer/Trash: $200 (estimated - haven’t lived here long enough for a full bill)
Gas for house: $25
Internet: $105 (work from home, need best internet we can get)
Cell Phone: $100
Car Insurance: $80 (one car, two drivers, liability only)
Netflix/Hulu: $25
Apple Music/Spotify: $25
Groceries/Toiletries/Pet Food: $300
Entertainment/Eating Out: $200
Gas for Car: $100
Misc (Car Maintenance, Haircuts, etc): $200

Total Expenses: ~$4125.00/mo

Total Savings: $1875/mo

Assets:

House: $505,000 (this is purchase price, but Zillow says its worth $550,000. More details below)
EF/Cash: $10,200
My 401k: $17,500
My Roth IRA: $11,000
His 403b: $2500
His Roth IRA: $5000

Total: $551,200

Liabilities:

Mortgage: $405,000 @ 4.625%
Credit Card: $5,250 (unsure of interest rate - probably 10-15%)

Total: $410,250

Net Worth: $140,950

Immediate Goals:

Paying off the stupid credit card. Fiance and I are on the same page about this. I stopped contributing to my Roth to focus on this. With Christmas bonus for me and lots of holiday overtime for him, we expect to wipe it out by January ($2500 end of this month, $2000+ in Dec, $1000+ in Jan)

Short to Medium Term Goals:

House

We bought a fixer upper, but with good bones. 1500 sf, 3 bed, 2 bath with a den and a workshop behind the garage and a small but nice backyard. It is also 4 miles from fiance’s work, so he bikes to work when it makes sense. We purchased for $505,000 but Zillow and comps in the area are around $540-550k and updated homes are selling for $585-600k.

We are planning to renovate this house, doing as much of the work ourselves as possible. Plans include replacing electrical, expanding/renovating kitchen, replacing paneling with drywalls, new light fixtures, renovating bathrooms, etc. Also, we’re missing key furniture, including a couch and dining room table.

I work from home, so one of the extra bedrooms serves as my office + filming for YouTube videos. However, we are thinking about renting out the third bedroom - we’re a couple miles from a large state university and could probably get $500-750/mo.

Wedding

Been together 6 years. Wedding will be simple - backyard wedding, borrow stuff from friends and family, etc. Our budget is $3500, most of which is food and drinks for 50-75 people. Family have offered about $500-800 in cash gifts and services as well. Wedding is scheduled for July of 2019.

College

Work is paying for me to get a Masters in accounting, which is great, but depresses my salary slightly and will take up to 20 hours/week for the next two years.

Fiance is looking to finish his Bachelor’s degree - he has two years left and estimated total costs are $22,000.

The Plan

  • Pay off credit card
  • Increase EF to $15,000
  • Start contributing to Roth IRAs again (about $900/mo)
  • Save for wedding (about $500/mo - this will stop after July)
  • Split remaining cash flow between renovations and saving for school

I don’t necessarily have a specific questions beyond seeing if this makes sense, where we can improve, and if the order/priorities make sense. Thanks for reading and any advice provided!

[Edit: Changes made to salary and take home pay to account for promotion that occurred shortly after posting]
« Last Edit: November 20, 2018, 07:47:56 PM by debtfreejess »

WheresMyMule

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Re: Just Bought a House - Any Advice?
« Reply #1 on: November 10, 2018, 12:43:13 PM »
You feel house poor because you are house poor. Mortgage + PMI + utilities is half your income and you don't have a maintenance fund or a line to save for maintenance in your budget.

Your EF could be wiped out in a week if your furnace goes or some other home maintenance pops up. I'd focus on getting another $10k in short term savings as a preliminary maintenance fund and try to add about 1% per year to it for both minor and major things your home will need. This is separate from any savings for improvements.

Do you track spending currently? There seems to be quite a bit missing from your expenses.  $200/mo isn't much to cover car maintenance, clothes, shoes, gifts, household needs, hair cuts, subscriptions, etc

Sent from my Pixel 2 using Tapatalk

« Last Edit: November 12, 2018, 10:32:50 AM by WheresMyMule »

Linda_Norway

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Re: Just Bought a House - Any Advice?
« Reply #2 on: November 10, 2018, 01:05:33 PM »
I see that you have a post for pet food. Do you have additional pet costs? Like vet visits, taxes or dog hotel during vacations?

Does one of you work from home fulltime? Do you really need two cars?
Why do you have double entertainment for TV and music?

You could cash in the house and the increase in price, and rent a place if that is cheaper than owning. Check out the owning versus renting calculator.

debtfreejess

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Re: Just Bought a House - Any Advice?
« Reply #3 on: November 10, 2018, 06:03:08 PM »
You feel house poor because you are house poor. Mortgage + PMI + utilities is glad you're income and you don't have a maintenance fund or a line to save for maintenance in your budget.

Your EF could be wiped out in a week if your furnace goes or some other home maintenance pops up. I'd focus on getting another $10k in short term savings as a preliminary maintenance fund and try to add about 1% per year to it for both minor and major things your home will need. This is separate from any savings for improvements.

Do you track spending currently? There seems to be quite a bit missing from your expenses.  $200/mo isn't much to cover car maintenance, clothes, shoes, gifts, household needs, hair cuts, subscriptions, etc

Sent from my Pixel 2 using Tapatalk

Thanks for the feedback! We're definitely looking to up our EF. While our housing is a little high, everything else is a little low and I feel like we have enough room in the monthly cash flow ($1500-$2000/mo) to handle smaller issues like a broken window or faucet without dipping into the savings at all.

Regarding misc spending and tracking, I do currently track our expenses. I'm not great about turning the very occasional hiccup (e.g. car repair or vet visit) into a line item in the budget since its usually easily covered by the remaining cash flow. However, our more regular "misc" spending is pretty low. I make most of our toiletries and all our cleaning products, I cut my own hair, we buy clothes from thrift shops, do our own oil changes, and "gifts" in our family are usually taking someone out for dinner or drinks, so we incorporate it into our entertainment budget for the month.

debtfreejess

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Re: Just Bought a House - Any Advice?
« Reply #4 on: November 10, 2018, 06:10:27 PM »
I see that you have a post for pet food. Do you have additional pet costs? Like vet visits, taxes or dog hotel during vacations?

Does one of you work from home fulltime? Do you really need two cars?
Why do you have double entertainment for TV and music?

You could cash in the house and the increase in price, and rent a place if that is cheaper than owning. Check out the owning versus renting calculator.

Thanks for the comment Linda! Additional pet costs are pretty low - no taxes, we swap petsitting with my fiance's mother, and we've only had to take the dog to the vet once since his initial round of shots and puppyhood appointments. He's only 5 now and will likely develop health problems as he gets older, so we'll definitely keep that in mind for future planning and budgeting.

I do work from home full-time. We only have one car that we share - a 2012 Hyundai Accent. I'm sorry if my original post was confusing.

The rent on a similar sized home in the area is $3000-$3500/mo. A two-bedroom apartment is $2200/mo (thanks LA!) - fortunately, since we got this home so under market value, it's damn near a toss up between renting and owning, but we get to build equity in this house. Down the road, we're considering moving out of the area to a cheaper part of the country, but likely not until we have kids and they're a little older (we want our kids to be close with their grandparents, who are all settled nearby).

Ben Kurtz

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Re: Just Bought a House - Any Advice?
« Reply #5 on: November 10, 2018, 07:57:33 PM »
After paying off the credit card balance, the one worthwhile tweak I can think of is to increase your tax-free 401k / 403b contributions. With relatively high state income taxes in CA that will be worth a lot on your tax returns. In fact, it is probably worth holding off on the credit card repayment and put in extra savings this year, while you are each filing taxes as single people and probably in higher tax brackets, and not lose the tax-advantaged space. Pay off the card in January. And next year have higher contributions all year.

It's hard to criticize most of your other choices. But earning only a middling salary in a HCOL metro means FIRE will take some time. Stay strong!
« Last Edit: November 12, 2018, 12:44:56 PM by Ben Kurtz »

affordablehousing

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Re: Just Bought a House - Any Advice?
« Reply #6 on: November 12, 2018, 10:11:07 AM »
Only advice is to make sure you finish the renovation before you have kids!

debtfreejess

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Re: Just Bought a House - Any Advice?
« Reply #7 on: November 12, 2018, 07:49:04 PM »
After paying off the credit card balance, the one worthwhile tweak I can think of is to increase your tax-free 401k / 403b contributions. With relatively high state income taxes in CA that will be worth a lot on your tax returns. In fact, it is probably worth holding off on the credit card repayment and put in extra savings this year, while you are each filing taxes as single people and probably in higher tax brackets, and not lose the tax-advantaged space. Pay off the card in January. And next year have higher contributions all year.

It's hard to criticize most of your other choices. But earning only a middling salary in a HCOL metro means FIRE will take some time. Stay strong!

Thanks Ben! We definitely need to increase our contributions, particularly his.

lhamo

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Re: Just Bought a House - Any Advice?
« Reply #8 on: November 12, 2018, 08:40:52 PM »
You need to figure out what it is going to cost you to be added to his health insurance sooner rather than later so that you can plan accordingly -- it will probably be more than you think/want.

Yes to renting out one or more of your extra bedrooms (can you use the "den" as your office/video space to free up a second bedroom?), even temporarily as the occasional Air BnB.  That would help offset your high housing costs.  Even a couple hundred bucks a month would help.  Or rent out the whole house while you travel/visit nearby family.

Netflix or Hulu -- pick one, you don't need both

Apple music or spotify -- pick one, you don't need both

Since your fast internet is needed for work, can they pay at least part of the cost?


$100/month for gas seems REALLY high to me if you WFH and he bikes to work a lot.  We are a one-car family with no commute (though I do sometimes give the kids rides to school) and typically spend around $30-50/month on gas (hybrid that gets 41 mpg).

Tuskalusa

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Re: Just Bought a House - Any Advice?
« Reply #9 on: November 12, 2018, 10:51:03 PM »
In your case study, you mention “Mortgage + PMI.”  If you’re paying PMI on your Mortgage, I’d recommend looking at paying down enough of your Mortgage to drop PMI (after increasing your emergency fund). 

debtfreejess

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Re: Just Bought a House - Any Advice?
« Reply #10 on: November 13, 2018, 07:50:33 AM »
You need to figure out what it is going to cost you to be added to his health insurance sooner rather than later so that you can plan accordingly -- it will probably be more than you think/want.

Yes to renting out one or more of your extra bedrooms (can you use the "den" as your office/video space to free up a second bedroom?), even temporarily as the occasional Air BnB.  That would help offset your high housing costs.  Even a couple hundred bucks a month would help.  Or rent out the whole house while you travel/visit nearby family.

Netflix or Hulu -- pick one, you don't need both

Apple music or spotify -- pick one, you don't need both

Since your fast internet is needed for work, can they pay at least part of the cost?


$100/month for gas seems REALLY high to me if you WFH and he bikes to work a lot.  We are a one-car family with no commute (though I do sometimes give the kids rides to school) and typically spend around $30-50/month on gas (hybrid that gets 41 mpg).

Thanks lhamo! I'm having my fiance double check the premium to add me in a year or two - he's understood it to be that his employer covers the whole premium for spouses and dependents, but I definitely want that confirmed. [Edit: He just confirmed with HR that his work will cover 100% of my premium - yay!]

We hadn't thought about putting my office in the den. I'll definitely float it by him and see what he thinks. We're definitely planning to rent out that extra bedroom as soon as possible.

My work pays me a $25/mo reimbursement for the business portion of my personal phone and internet. It's low, but it's something.

The $100 for gas is an estimate, as we've only lived in this house for a month or so. Part of it is the cost of seeing our family - they're spread over four different corners of LA, which is the definition of sprawling metropolis. My fiance is also hesitant to bike to work during the Santa Ana winds, which is a complainypants excuse, but I have gotten him to walk for most of our errands, so that's something. Also, so far we've only spent about $30 on gas this month and still have at least half a tank in the car, so I'm confident that the $100/mo will be coming down. :)
« Last Edit: November 13, 2018, 07:57:19 AM by debtfreejess »

debtfreejess

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Re: Just Bought a House - Any Advice?
« Reply #11 on: November 13, 2018, 07:54:10 AM »
In your case study, you mention “Mortgage + PMI.”  If you’re paying PMI on your Mortgage, I’d recommend looking at paying down enough of your Mortgage to drop PMI (after increasing your emergency fund).

Good point Tuskalusa! Right now, our PMI is 0.2% or $58.08/mo. I think the automatic drop-off date is April 2022 at 22% equity, but we can get the house re-appraised at 20% equity and have it drop off then. We do want to put extra on the principal and see that PMI disappear faster, just aren't sure how to balance it with the other short term goals.

lhamo

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Re: Just Bought a House - Any Advice?
« Reply #12 on: November 13, 2018, 08:00:18 AM »
Yes, he should definitely look into the insurance thing -- call me old-fashioned, but I find it a bit odd that a married working professional is still on their parents insurance.  Nice thing for your parents to do if your budget is really stretched and you don't have a cheap option, but if it is free to join your DH's plan?  Switch.

Now that you have a house maybe more of your family visits can be at your place. That would save on gas, too. Though a roommate situation might make that more awkward.

debtfreejess

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Re: Just Bought a House - Any Advice?
« Reply #13 on: November 13, 2018, 08:33:22 AM »
Yes, he should definitely look into the insurance thing -- call me old-fashioned, but I find it a bit odd that a married working professional is still on their parents insurance.  Nice thing for your parents to do if your budget is really stretched and you don't have a cheap option, but if it is free to join your DH's plan?  Switch.

Now that you have a house maybe more of your family visits can be at your place. That would save on gas, too. Though a roommate situation might make that more awkward.

Agreed. We don't get married until July of 2019 and last we looked into it, they won't let me on his plan until we have filed taxes together, so likely won't be able to join his insurance until 2020. I definitely appreciate my parents for letting me stay on, though it doesn't cost them extra - my brother has an autoimmune disease and has to be on their insurance and once you have one dependent, the second dependent doesn't cost more.

I agree, we've been trying to get them to visit us more. It's worked some of the time, so we're happy about that :)

CalBal

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Re: Just Bought a House - Any Advice?
« Reply #14 on: November 13, 2018, 08:39:53 AM »
Just a note about insurance - getting married should be a qualifying life event (AFAIK), so you should be able to join his insurance immediately after that happens and not have to wait until the next open enrollment.

Finances_With_Purpose

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Re: Just Bought a House - Any Advice?
« Reply #15 on: November 16, 2018, 11:02:32 PM »
Listen to @Ben Kurtz.  Also, you don't mention where in your tight budget the renovation budget will come from (that I saw), which also needs to be accounted for.

My #1 tip: get a much, much larger emergency fund.  With a house, more things can go wrong.  Listen to @WheresMyMule and put up $10k + 1% (of house value) per year or so, especially right now, when it'll hurt you the most. 

I know someone who recently bought a very nice house - with everything almost new - but within year 1 had spent over 2% of home value on things as the 2-3 things that weren't new broke down almost simultaneously.  It can and does happen, and year 1 is when you find out what all really needs to be done. 

My #2 tip: your house now stands in the way of your other long-term financial goals, because you are invested so heavily in only your house (including as a flip), while your goal to live where you are may not line up time-wise -- you want to stay until your kids are old enough.  Find a way to balance those things while being honest about the large financial trade-offs involved, i.e., exactly *what* you're paying for various lifestyle-goal decisions.

All else equal, once you get PMI paid off, you would benefit significantly if you stash more savings in places other than your house, even if that means delaying renovations.  You're not flipping soon anyway.

For instance, you're planning to put money into the house as a flip, but you aren't actually flipping for a good while, per your goals, which means that the money you spend renovating lies dormant and unproductive rather than being productive and making you money (until you're ready to sell).  What's $10k worth to you over eight to ten years compounded (i.e. 20k+) versus $10k cash in that final year? 

Besides, you want to diversify investments in general: have some money stashed in other accounts (especially tax-advantaged ones) where you may be able to keep them more easily if something goes strangely wrong with the house/property.  Or the local real estate market.  Etc. 

--

Bottom line: Personally, I would drop all renovation saving and simply do school or invest that right now.  Revisit renovations when you're closer to actually selling, rather than ten years ahead of time, which sounds to me more like a choice to consume (yet more) house. 

Besides, doing school might push your SO's career further faster anyway, and the last thing you want to pile on here is some form of student debt.  Plus, you could put the reno money towards equity at least until you kill PMI - some instant savings. 

--

If, as implied above, you're actually renovating because you want the house that way, that's more of a consumption now than an investment, especially if you're putting off education for it (too).  If that's the real goal, you should be honest with yourself about the tradeoff: that would be letting that money sit useless while you're living there rather than investing it.  And putting more money into the house after all the money you're already in it for.  I would apply the "first rule of holes," which is when you're in one: stop digging. 

You may want to do dig further, though I wouldn't recommend it financially, especially right now, and especially until you're less "house poor."  And lest this sound negative, I assume you're in a position you will likely climb out of as careers progress and so on, and all the more so if you tighten the belts now, and in the future you'll appreciate the renovations and other things more anyway. 

debtfreejess

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Re: Just Bought a House - Any Advice?
« Reply #16 on: November 18, 2018, 09:59:00 AM »
Listen to @Ben Kurtz.  Also, you don't mention where in your tight budget the renovation budget will come from (that I saw), which also needs to be accounted for.

My #1 tip: get a much, much larger emergency fund.  With a house, more things can go wrong.  Listen to @WheresMyMule and put up $10k + 1% (of house value) per year or so, especially right now, when it'll hurt you the most. 

I know someone who recently bought a very nice house - with everything almost new - but within year 1 had spent over 2% of home value on things as the 2-3 things that weren't new broke down almost simultaneously.  It can and does happen, and year 1 is when you find out what all really needs to be done. 

My #2 tip: your house now stands in the way of your other long-term financial goals, because you are invested so heavily in only your house (including as a flip), while your goal to live where you are may not line up time-wise -- you want to stay until your kids are old enough.  Find a way to balance those things while being honest about the large financial trade-offs involved, i.e., exactly *what* you're paying for various lifestyle-goal decisions.

All else equal, once you get PMI paid off, you would benefit significantly if you stash more savings in places other than your house, even if that means delaying renovations.  You're not flipping soon anyway.

For instance, you're planning to put money into the house as a flip, but you aren't actually flipping for a good while, per your goals, which means that the money you spend renovating lies dormant and unproductive rather than being productive and making you money (until you're ready to sell).  What's $10k worth to you over eight to ten years compounded (i.e. 20k+) versus $10k cash in that final year? 

Besides, you want to diversify investments in general: have some money stashed in other accounts (especially tax-advantaged ones) where you may be able to keep them more easily if something goes strangely wrong with the house/property.  Or the local real estate market.  Etc. 

--

Bottom line: Personally, I would drop all renovation saving and simply do school or invest that right now.  Revisit renovations when you're closer to actually selling, rather than ten years ahead of time, which sounds to me more like a choice to consume (yet more) house. 

Besides, doing school might push your SO's career further faster anyway, and the last thing you want to pile on here is some form of student debt.  Plus, you could put the reno money towards equity at least until you kill PMI - some instant savings. 

--

If, as implied above, you're actually renovating because you want the house that way, that's more of a consumption now than an investment, especially if you're putting off education for it (too).  If that's the real goal, you should be honest with yourself about the tradeoff: that would be letting that money sit useless while you're living there rather than investing it.  And putting more money into the house after all the money you're already in it for.  I would apply the "first rule of holes," which is when you're in one: stop digging. 

You may want to do dig further, though I wouldn't recommend it financially, especially right now, and especially until you're less "house poor."  And lest this sound negative, I assume you're in a position you will likely climb out of as careers progress and so on, and all the more so if you tighten the belts now, and in the future you'll appreciate the renovations and other things more anyway.

Hi Finances_With_Purpose. Thank you so much for your thoughts and advice - I really do appreciate it. I want to start with a quick clarification - while we're looking to stay in this area for next several years, we're not necessarily committed to this particular house the entire time. However, we actually don't have a long term plan for how long we'll be here, so I think you're right - non-functional renovations should definitely wait until we've gotten the rest of our ~financial~ house in order. There are a few things we need to do to make our house functional (e.g. we have no floors in our dining room, missing light fixtures in half the house, and the electrical needs an upgrade in the next year or so), but those are relatively inexpensive and we'll be doing most of those ourselves. Our current plan is to not do any work on the house that requires money until the credit card is paid off and we start filling the EF up some more. After the wedding is over, I want to majorly increase his 403b requirements. We're looking at some big jumps in pay once we both finish schooling, so it makes sense to focus on getting through that, then re-visit the home renovations when our income has increased and we don't have other big looming expenses. Thank you again for the time you took to read my case study and your thoughtful advice. :)

former player

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Re: Just Bought a House - Any Advice?
« Reply #17 on: November 18, 2018, 11:12:31 AM »
Cleaning and painting and keeping the yard tidy make a big difference to the appearance of a house for not much money.  Anything else that's not strictly functional can wait - which has the advantage that it will all be much more up to date by the time you sell/have kids/etc.

The one thing that does concern me is your reference to the house needing electrical work.  Is it currently safe? Do you have functioning smoke alarms, fire extinguishers and agreed escape plans for daytime and nighttime fires?

Considering your ages, having $36k in tax-advantaged accounts and no student loans is a good start.  Other than that, yes you are overhoused, and adding even a backyard wedding in your first year of homeownership will stretch things further.  But if you can get through the first two years without any major disasters things will start to feel a lot easier.

Finances_With_Purpose

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Re: Just Bought a House - Any Advice?
« Reply #18 on: November 18, 2018, 01:40:40 PM »
Anytime.  You have a good plan worked out: stick it out until after your jobs bump up, at which point a little renovation savings is less of a hardship, won't interfere with your other goals as much, and you'll be closer to moving. 

Like I mentioned, I really do think the future is bright.  You're in the tough phase now - just doing those functional upgrades - but it will get better as you plod along.  Agree completely with @former player on that. 

debtfreejess

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Re: Just Bought a House - Any Advice?
« Reply #19 on: November 19, 2018, 03:05:14 PM »
Cleaning and painting and keeping the yard tidy make a big difference to the appearance of a house for not much money.  Anything else that's not strictly functional can wait - which has the advantage that it will all be much more up to date by the time you sell/have kids/etc.

The one thing that does concern me is your reference to the house needing electrical work.  Is it currently safe? Do you have functioning smoke alarms, fire extinguishers and agreed escape plans for daytime and nighttime fires?

Considering your ages, having $36k in tax-advantaged accounts and no student loans is a good start.  Other than that, yes you are overhoused, and adding even a backyard wedding in your first year of homeownership will stretch things further.  But if you can get through the first two years without any major disasters things will start to feel a lot easier.

Thanks for your concern @former player. Most of the electrical is original to the house (built in 1953) with a pretty small panel (100 amps). The previous owner was also a DIYer that had little regard to for code or safety, so lots of wires all over the place. However, we removed a lot of the wires of concern and we keep our energy usage low to minimize demand on the system (e.g. LED lights in every room, don't use clothes dryer or dishwasher, etc.) The home inspector said it is safe for now, but should be upgraded sooner rather than later. We do have functioning smoke alarms and a large window in every room of the house that we can get out of in the event of an emergency.

Thank you also for the well wishes. We didn't anticipate buying a house before we got married, but we jumped on the opportunity when it presented itself. It'll definitely be a hectic 2019, but I know we can handle it. 

debtfreejess

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Re: Just Bought a House - Any Advice?
« Reply #20 on: January 09, 2019, 09:09:44 AM »
Update!

We've taken a few steps in the right direction - I'll probably add this every few months to keep myself on track.

  • As mentioned, I got a promotion, so my base salary is now $60,000 with an anticipated 10% in bonuses throughout the year
  • Fiance has increased his 403b contribution to $400/mo (up from $100/mo and in addition to his pension contributions)
  • Credit card is less than $1000 now - should be paid off in a couple weeks!
  • Convinced my CEO to start doing a 401k match at planning meeting, so now getting 4% matched going forward
  • Everyone gave us Home Depot gift cards for Christmas, so we'll be able to do some immediate repairs and renovations without using savings

Looking forward to even more improvements next time.

Villanelle

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Re: Just Bought a House - Any Advice?
« Reply #21 on: January 10, 2019, 10:47:50 PM »
What is your fiancee studying?  Is it something that is likely to get him a significantly higher salary?  It may well not be worth it to finish the degree.  If it is or if he's doing this for emotional reasons, spend some hours looking for scholarships.  If you put in 5 hours and come up with even a $250 scholarship, that's a pretty good return. 

And don't buy any new furniture.  Scour free cycle or *maybe* thrift stores.  You can't afford anything else.  Also let everyone know you are looking.  Often people have stuff they are going to donate and are happy to give it to a young couple starting out.

Dicey

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Re: Just Bought a House - Any Advice?
« Reply #22 on: January 11, 2019, 05:32:02 AM »
And don't buy any new furniture.  Scour free cycle or *maybe* thrift stores.  You can't afford anything else.  Also let everyone know you are looking.  Often people have stuff they are going to donate and are happy to give it to a young couple starting out.
Great advice from Villanelle!' I don't do FB Marketplace, but I do NextDoor. I'm furnishing a flip house on a shoestring budget. ND is great. The sellers are nearby. I thrift a lot, but rarely see furniture worth buying. Craigslist is another option that beats the stuffing out of thrift stores.

debtfreejess

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Re: Just Bought a House - Any Advice?
« Reply #23 on: January 12, 2019, 10:01:50 AM »
@Villanelle My fiancee is studying Information Technology. He currently works in the field, but only got the job after working at the company PT for 2-3 years in a different role and we're worried that without some formal education or certs, he would have a harder time finding a similar position with another employer that he didn't have a history with. We are planning to apply for scholarships, but since his current job is stable, he's taking a year off from school until we increase the emergency fund, pay off the card, and get married. Want to avoid too many balls in the air!

@Dicey We've spent maybe $200 on furniture since we moved in, pretty much all of it from Next Door, thrift stores, donations from family, and stuff left by the home sellers themselves. The only thing we're a little dicey about getting secondhand is a couch, because upholstered items can be a mixed bag when it comes to bed bugs, fluids, pet hair, etc. However, we've agreed to hold off on buying a couch until after the immediate goals of (1) paying off card; (2) increasing emergency fund; (3) getting married; (4) doing semi-urgent home repairs and updates, such as flooring in dining room (currently just sub-flooring) and new electrical (current is not to code). In the mean time, I'm really enjoying the hunt - I've gotten some really nice things for little to no money and the fiance has finally stopped teasing me about it since it's worked out so well ;)

frugal_c

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Re: Just Bought a House - Any Advice?
« Reply #24 on: January 12, 2019, 11:56:02 AM »
I agree that you want to postpone much of the house upgrade but then again there are quite a few upgrades which are very cheap but labor intensive.  I would focus on those.  You had mentioned electrical, if you can do it yourself and just get an inspection it costs so little.  A few hundred dollars will go a long ways on the electrical work I have done.   Painting, drywall, some plumbing, some flooring can be very reasonable if you DIY but can be very time consuming.  There are probably other things I am forgetting.  I would focus on those areas where you get the most bang for your buck.  Try to avoid windows, cabinets, countertops and other expensive items for now.

Brother Esau

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Re: Just Bought a House - Any Advice?
« Reply #25 on: January 13, 2019, 08:22:51 AM »
Watch the movie "The Money Pit".