3 Household Costs You’re Probably Paying Too Much For

Being a homeowner garners a lot of responsibility, but it can also include financial burden. It’s important to know how much you should actually be spending on household costs. Here are a few areas where you may be overspending.

Your Mortgage

Many people pay too much for their mortgage and it’s possible you are too. One way to know if you’re spending too much is if your mortgage payment is more than 25% of your net income. There are a couple ways you can lower your payment. If you know you’ll be in your home for a long time, consider extending your payment term. This will lower your monthly payments. Another option is refinancing. Refinancing can save you thousands of dollars over time. If you aren’t sure when to refinance, one rule of thumb is to make sure the new rate is at least 1% lower than your current rate in order for it to be worthwhile.

Your Electric Bill

One of the largest household expenses is your electric bill. You might be noticing a steady increase in your bill without a clear reason why. If this is the case, take stock of how you use electricity in your home. Using old appliances can often increase your bill as can keeping many things plugged in at once. Make sure you’re only using electricity for things you are currently using. Another big electricity user in your home is your AC unit. Instead of always defaulting to cranking the AC, consider opening windows or using fans. As a final resort, you may want to have a professional audit your home for electricity usage to see where all your money is going.


As a homeowner, it’s likely you’re paying too much for homeowner’s insurance. Review your time in your home. How often have you actually needed your homeowner’s insurance? If you live in a safe area where disasters are less likely to happen, then you can afford to adjust your insurance. For example, you could increase your deductible. Sure, it might be higher when you actually need insurance, but your annual costs will be far lower. You may also want to consider adjusting your insurance rates annually as you assess your needs. Do whatever you can to save money and avoid overpaying.

It’s important that you are aware of how your money is being spent and whether or not it is necessary. Take stock of your expenses and see where you might be overpaying. It’s never too late to make changes in order to lighten the financial load.

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