So you want to buy your first home. (Exciting!) You start saving for a down payment. (Smart thinking.) You begin your house hunt and find your dream house. (Yay!) You put an offer in and it’s accepted. (Congrats, home owner!)
Moving day comes and you haul the furnishings from your small, one-bedroom apartment to your new house.
You look around and realize you’ll probably need to buy living room furniture, a kitchen table, outdoor furnishings, possibly office and guest room furniture, new TVs, new decorations, and more. Oh, and you’ll need a lawn mower. And maybe kitchen appliances. And definitely a gas grill.
That’s a lot of stuff. And then it hits you: You probably should have saved for these things before you bought your house.
I’ve always been a big advocate of saving a New Home Expense Fund prior to buying your first home, but I’ve never really discussed just how much you should save. Samantha asked me in a comment last week:
I don’t really share actual dollar amounts on my blog anymore (since I go by my real name and all), but I will tell you that we did save a substantial amount for new home expenses prior to saving for our down payment fund.
I don’t think there are any percentage guidelines out there, so, based on the estimates we used, you might consider saving anywhere from 3% to 5% of what you expect to pay for your house – especially if you’re upgrading substantially in size.
But if you don’t like using percentages, you could even create a mock budget. You probably already know many of the new things you’ll need (a new L-shaped couch is on our list and we know that will cost ~$1,500). You can also scour the web to research the amounts other people have spent on new home furnishings (this recent post at Young House Love was helpful to us since they bought all new kitchen appliances).
Our new home expense fund is much smaller than our down payment savings, which is why we knocked it out first. In fact, we probably saved too much (especially now that we don’t have to drop $1-$2k on a new king mattress).
But, having too much saved is never a bad thing and it removes a GREAT deal of stress from the home-buying process. Going furniture and décor shopping it going to be SO much more fun knowing that we have the money ready to spend (and we’re not relying on credit cards!).
Thanks for your comment, Samantha! I hope that helped!
Did you save for new home expenses when you bought a house? Or do you plan to save for these items before you buy a house?