Everyone always talks about how to buy your first home, but nobody really talks about what you need to do after that. Here is a few things to keep in mind…
(please keep in mind I am not a financial advisor, mortgage broker or anything along those lines. I am speaking from my own experience and all advice is general in nature and I strongly advocate personal advice from a qualified professional)
1. Home and Contents Insurance: A mandatory part of owning a home (luckily) if your home has a mortgage. Generally speaking, I would pick a couple (2 or 3) of well known insurers as opposed to an insurance comparison website, and do your own comparisons based on your needs. NOT EVERY INSURER IS THE SAME. It may also be worth discussing insurance with your bank as many do home and contents insurance at a discounted rate. Ultimately, they own more of your house than you do, so it is in their best interest to keep it in good condition.
2. Internet connection: Typically speaking, these days a builder will include all the cabling and infrastructure to have NBN connected at your new house – definitely something to make sure is included in your specifications before signing a contract. Nevertheless, a few weeks before move in date you should organise to have the internet connected so that it is ready to go when you move in.
3. Order your rubbish bins before handover date from your local council
4. Change your mortgage repayments to weekly or fortnightly and round up your repayment, like right now. Stop reading this and go do it. Most people don’t know this but bank interest is calculated daily. Basically what that means is the more often you make repayments, the less interest you pay. It may not sound like a lot, but we changed our repayments from monthly to fortnightly (day after pay day) and increased our repayment by $30 per week, and our mortgage duration calculation went from 30 years to 25 years and 7 months. That is approximately 228 weeks less time you are making mortgage repayments.
LET ME REPEAT THAT. 228 WEEKS LESS MORTGAGE REPAYMENTS.
Based on the average mortgage size in QLD being $1885 per month, that is roughly $99,905 less interest I am paying on my mortgage by spending an extra $30 per week up front and paying my mortgage more regularly.
To put that in long term financial situation, I can pay for my own retirement for about 2-3 extra years by doing this, or short term I can buy a brand new 2019 Mercedes Benz X4 – not that I recommend doing that.
Its not magic or a scam, its the power of compound interest.
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