Imagine you are a twenty-something post-grad that has just moved to the big city. You just got your first "real" job, and you are on the hunt for an apartment. You find a place you love, but the landlord ends the conversation asking if you have a renters insurance policy in place. A what?! Why would you possibly need renters insurance? Doesn't the landlord have everything covered in their homeowner's policy?
Renters insurance is a type of property insurance that can cover the loss of your personal belongings, liabilities, and living expenses. We'll break down what renters insurance does and doesn't cover to help you determine whether or not you, the tenant, will need it.
Unbeknownst to many renters, your personal property is not covered by your landlord's homeowner policy. This means that if you lose all of your possessions in a house fire, you will not be paid out by your landlord's insurance company.
Renters insurance covers you against losses from fire or smoke, lightning, vandalism, theft, explosion, windstorm, and certain types of water damage. In fact, most policies will cover your items even when they aren't on the property premises. Was you laptop stolen on vacation? You are covered under your renters insurance!
There are two options when choosing personal property coverage through renters insurance: replacement cost and actual cash value policies.
Replacement cost policies will cost more out of pocket, but they provide a large enough payout to replace the damaged or lost items at full retail price. Remember that laptop that was stolen on vacation? Even though it was three years old, you get the brand spanking new replacement.
Actual cash value policies will save you a bit on your premiums price; however, they will only pay out based on the value at the time the policy is taken out, minus depreciation value. With this type of policy, your stolen laptop probably will only get you a payout of about a quarter of what you purchased it for. You can use this handy depreciation calculator yourself to estimate the actual cash value of your personal belongings.
Liability insurance also comes standard with renters insurance policies. It protects you from any potential lawsuits from bodily injury and property damage that occurs on the premises. If you accidentally start a kitchen fire while cooking dinner, or your best friend's girlfriend slips and falls down your wet stairs due to the melting snow that was tracked in, then your renter's liability insurance can cover you if you are sued for medical payments or for the property damage. It can even cover your legal defense fees.
Additional living expense coverage also comes standard in renters insurance policies. It provides financial coverage when you have to temporarily live elsewhere in the case of damage to the property at which you reside. Some examples of what costs are covered are the following:
- Hotel bills, or temporary rentals
- Costs of eating out due to loss of kitchen
- Laundry bills
- Furniture rentals
- Storage costs
- Pet boarding
The amount the insurance company will pay out on expenses for this coverage depends on the difference between what you would typically pay for these costs versus what you would pay during the displacement.
Now that you understand the basics of renters insurance and what it covers, do you think it's worth it? You might still be up in the air, especially because renters insurance is probably super expensive, right? Wrong!
A survey conducted by Nationwide found that 75 percent of those without renters insurance don't realize they can get monthly coverage for as little as the cost of a pair of movie tickets.
The average cost of renters insurance in 2017 was $180 a year, or $15 a month.
Many insurance companies offer discounts if you bundle other insurance policies, such as your car insurance with your renters insurance. Also, things like security systems, deadbolts, and smoke detectors can often give you a discount on the price tag.
Still not sure if you need renters insurance? I suggest doing the following:
- Create a home inventory list of all of your belongings. There are tons of apps that make this part easy, such as Home Contents.
- Write down the value of each item you want to be replaced if your apartment was to, let's say, burn down. If you don't know what you bought it for, look up the value online.
- Include receipts and appraisals when you can, especially for any high priced items.
- Save pictures of all the items (the app will help with this, too).
Creating this home inventory list will be important and make your life a heck of a lot easier if you do get renters insurance. But more importantly, it can give you an estimate of the price of your personal belongings.
So maybe you don't think you need renters insurance if you do not have a high value on your belongings. But I bet you might be surprised at how much money is invested in those items!
In short, renters insurance is most likely worth it. Although it's not a necessity, the value of being covered for potential personal property loss, accidental liabilities, and financial coverage in the event of a catastrophe is well worth the low annual premiums. And it may someday save you thousands of dollars. If you are a current renter, do yourself a favor and get some insurance quotes today!
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Between buying a new home and transporting yourself and your belongings to it, moving can be an expensive process. One often underrecognized cost of moving occurs before one's original house has even been sold, and that's staging the house. Homeowners often spend hundreds of dollars making a home appealing to potential buyers. To ease the financial burden of moving, here are several tips for staging your home on a budget.
Downsize Instead of Storing
The goal of staging a home is to create a blank canvas that potential buyers can imagine their own lives painted upon. To accomplish this, homeowners should depersonalize the home as much as possible, removing items that are specific to their family and eliminating clutter. This is where homeowners often incur their first costs as they rush to put as many older things in storage as possible.
To cut costs, focus on downsizing rather than storing items. Look for items that you can sell, donate, or give away. For remaining items, look for alternative places to store them, such as a friend or relative's house. This will also reduce the cost of moving your belongings when it is time to go to the new house.
DIY What You Can
There are times when homeowners should bring in a professional to manage home renovations and decorating, such as when a task requires specialized skills. These types of jobs, when done incorrectly, will incur even greater costs if attempted on your own. However, many of the home improvement tasks that go into staging a home are simple enough that the homeowner can DIY them, such as painting, installing a backsplash, or refinishing the deck. Doing these tasks yourself will save you a significant amount of money.
Don't Redo, Update
Homeowners are often eager to make their houses look as appealing to buyers as possible. However, recall that the point of staging is depersonalization, making a home presentable so buyers can mentally impose their own style onto it. When staging a home on a budget, focus less on completely transforming the space and more on making what is there look presentable. For instance, if you wanted to give your bedroom a facelift, trying to replace the furniture and flooring would be pointless unless it was damaged or unkempt. Simply organizing the space and replacing the bed's comforter would be sufficient.
Another way to update the space without entirely redoing it is to rearrange it to maximize the space that is already there. For instance, pulling the furniture away from the walls will make a room appear bigger and allows more space for those touring the house. Using window trimmings that maximize natural light and incorporating wall mirrors can also make a room seem more spacious.
Raising a larger family than most means that your lifestyle is going to change. Costs will continue to multiply as your family grows larger. However, just because your family is large doesn't mean your quality of life needs to suffer. It just means you need to make a few adjustments to help things work smoother and more efficiently. We've compiled a couple of money-saving tips for larger families to help you get the most out of your dollars.
Always Buy in Bulk
The benefit of having a larger family is that things you buy in bulk rarely ever go to waste. Smaller families can benefit from buying in bulk, of course, but your large family will see the most use out of shopping in large quantities. You'll want to avoid going to smaller stores for necessities such as groceries and clothes, as these places generally have higher markups on their items.
Buy Wholesale Items Online
If you want to take buying in bulk to the next level, one of the best money-saving tips for large families is to buy online from wholesalers. Buying online comes with a number of benefits that you won't get when you go to a physical store:
- You don't have to drag your kids to the store with you
- You have a lower probability of making impulse purchases
- You can search for exactly what you need
- Wholesalers sell in very large quantities for a lower price per item
Never Throw Away Something Useful
When you have to buy things for multiple children, your costs to replace items will be much higher. That's why it's so important to keep everything you can. Clothing is a big part of this. Hand-me-downs can prevent you from needing to replace entire closets every year. Try to repair or upcycle any clothes that may have damage, as this is usually much cheaper than buying brand-new items.
Stick to a Budget
When you support a large family, expenses can sometimes get away from you. Proper budgeting helps to keep the extra purchases that add up to a minimum. Budgeting correctly can save you a lot of heartache in the long run. It's up to you how much control you want to take; you can make your budget weekly or monthly, depending on how tight a ship you need to run. What's important to remember is that making the budget is only the first step—sticking to it is where you'll really need to enact some willpower.
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Sometimes there is no choice—a home needs to be sold in the winter.
Spring may be the most popular time to put your house on the market, but homes do sell in the colder months. With fewer houses available, your home may be someone's only choice when house hunting in your neighborhood. As your neighbors hold out until spring, you'll already be done and ready to shop for your next house!
Here are a few tips for selling a home in the winter to get you on the right track.
Keep Paths Safe and Landscaping Fresh
Landscaping is the last thing on a homeowner's mind in the winter. Everything was cut back in the fall and may now be covered in snow. Still, take a walk around the house and yard to check everything out. Branches may have fallen from heavy snow, leaving a mess in the yard. Keep everything neat and tidy.
The last thing you need is a potential buyer slipping on the ice-covered walk in front of your house. Buyers often consider those moments bad omens, and this can affect their decisions. Shovel, snow blow, spread salt—do whatever you have to do to keep the driveway and walking paths clear, and don't forget the porch and deck.
Make the Inside Warm and Cozy
In cold weather, buyers won't spend a lot of time examining a home's exterior. Instead, impress them with the inside by creating an atmosphere which causes them to want to move in.
When there's time, leave wintery types of snacks and drinks, such as hot cocoa and cookies, available on a table during showings. This gives your home a welcoming feel to buyers.
Light the fireplace (if you have one) for a lovely ambience and set your thermostat to a comfortable setting. A warm home in the winter is much more appealing than a chilly one.
Make Your Home Less Personal
Understandably, this can be a tough thought for homeowners. After all, you've spent years creating memories in your home. To buyers, though, they need to picture it as their own. Too much personality makes that difficult.
It's always important to stage your home in a way that makes it look clean, comfortable, and move-in ready. Don't feel offended by the idea of taking family pictures down and replacing them with generic décor. This will help your home sell faster by helping buyers envision their own things there.
Cleanliness and Maintenance
Clean, clean, and clean some more. Make appliances, counters, and floors shine. No matter how old your home is, it needs to feel like new to potential buyers. If you aren't into dusting, now is the time to try. Don't forget window coverings that might need washing.
Be prepared ahead of time for home inspections by taking care of maintenance now. HVAC systems, plumbing, and electrical should all be up to code and running smoothly.
Use these tips for selling a home in the winter, exercise patience during the slower months, and your home will sell before you know it.