Financial Hack: How long would you be able to pay your bills for if you were to lose your job tomorrow? Build your emergency fund, Thailand can wait.

At the beginning of 2020 my husband and I decided to house hunt. We bought our apartment 4 years ago, renovated and thought it was a good time to upsize.

We had a budget, we knew the area we wanted to settle down in and knew that our next move would be for the long term. 

Ideally we wanted a project. Something that was nice enough to move in to straight away, however somewhere that had room for a back extension and loft conversion.

Deal breaker. He needs his space – games room and I need mine, an office.

We made 3 offers on 3 separate properties. 2 Offers were accepted and then BAM Covid-19 triggers a lockdown.

This was a bitter sweet situation as we were given time to truly analyse and think about what we were spearheading in to.

We are living in uncertain times and it is said that it will be a while before life is truly back to normal and in many ways, we’re going to have to accept a new normal.   

Why I gave up my 4 Bedroom Detached House hunt and decided to stay in my 2 Bedroom Apartment a few more years…

After a self analysis of our finances and various eventualities we decided to remain put.

In our current state we knew that if one of us were to lose our jobs, the other could pay the bills 3x over before it became a strain. 

We knew that if both of us lost our jobs, we had enough savings to carry us over for a few months paying the bills whilst we hunted for new jobs.

If we were to upsize and take on a project this wouldn’t necessary be the case.

We’d essentially be taking on much higher outgoings because I wanted a shiny new house and project to get my paws in to – a want, not a need. 

The take away from this experience is to stay where you are until you outgrow your home and are bursting out of the seams. Or until you can financially make the move without any strain, taking all eventualities in to consideration. No one knows what tomorrow holds.

Keep those outgoings low.

Save. Save. Save.

Save. Save. Save and when it is time to upsize, you can do so effortlessly.

There’s a time to save, time to build and a time to enjoy what you’ve built. 

Tip: You should have enough savings to carry you through 3 months of a rough period. These savings will pay your Mortgage, utility bills and basic essential costs of living (travel, food etc.)

Theres an average of about a 3 month period from being made redundant to securing a new job and receiving your first “normal” pay cheque.

Build your emergency fund, Thailand can wait.

New Year, New Me, New Home?

New Years resolution. 

Maybe this new home goal rings a bell? 

If you waited until January to put your house on the market, or begin house hunting, welcome to the pool of the hundreds of others who are doing exactly the same.

Maybe you’ve come across your dream home, but guess what? You’re going to get outbid! Why? For every property out there you’re willing to pay X amount more for, there’s someone out there who has that little bit more liquid cash. That someone is willing to bump up their Offer to secure this property that turns out to be their dream home too. 

Buying a New Home this year? 

Here’s some advice:

Always have a buffer. Go in low (On the nose or just £5K under the asking price) and leave yourself room to increase your Offer so that you don’t get out bid.

Don’t over stretch yourself. Look at properties just under your budget in order to leave room for unexpected costs: if you have money left over at the end – even better.

Make sure you view the property both in the day and night. 

What vibe do you get? Are there people hanging on the corner? Is parking going to be an issue during peak times?

These are all things to take in to consideration.

Don’t forget to read up on the local area. What kind of crime takes place? Are you moving in to the middle of a gang war zone or a place that is renown for home burglary?

Remember that buying a new home is a long term thing, you can’t simply press undo or get a refund after living there for a month of feeling uncomfortable. Don’t be hasty, shop around and trust your instinct. 

Happy first Monday of the New Year and Happy House Hunting!

Feel free to share your House woes and House Wins with me ⤸

Twitter: @AshantaLC

Instagram: @Ashanta_

LinkedIn: Ashanta Charm 

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