For all the advantages that homeownership brings, facing appliance replacement and major home repairs certainly isn’t one of them, which is why it’s important to allocate some savings into the monthly budget. Instead of relying on credit, when the HVAC system is on its last legs or your water heater or roof springs a leak, you’ll have a financial cushion.
Age of the Appliances
As a rule, an HVAC system that’s maintained by a pro at least once a year will last up to 20 years and a water heater from eight to 12 years. Shingled roofs will last from 20 to 30 years, depending on the quality of the shingles.
The cost of replacement HVAC systems varies by size, manufacturer, energy efficiency, and its optional features. The average cost, without installation is approximately $5,000. Water heater minimum efficiency standards changed a few years ago and it may cost as much as $1,000 to install a new 40 gallon gas water heater. New roof costs vary widely by home size, materials used and roof condition.
Budgeting for New and Existing Homes
People who buy new homes often rely on the warranties the builder provides to cover them for at least a few years. Even so, experts recommend setting one to two percent of your home’s value aside each month for appliance replacements and other big-ticket maintenance items like a roof or siding replacement.
If you bought an existing home, you can determine the amount to set aside in the monthly budget by finding each appliance’s life expectancy in months and dividing its replacement costs by the number of its remaining months. If your HVAC system will last another 60 months and its replacement cost is $6,000, you’ll need to save $100 per month to pay cash for a new one.
Setting aside an emergency fund in the monthly budget for appliance and home repairs is a good idea, as is professional maintenance to increase their lifetimes. To schedule regular maintenance to reduce the likelihood of exorbitant repairs, contact Aggressive Mechanical Contractors.
Our goal is to help educate our customers in Monmouth County, New Jersey and surrounding areas about energy and home comfort issues (specific to HVAC systems).