December 11 - Phase V

      For Phase V, the final phase, we covered the costs of our future home (down payment, mortgage, maintenance, and insurance).  Since I will likely be working in NYC when I'm older, I found a house in a nearby county.  http://www.homes.com/listing/172682880/1107_Pondside_Dr_Unit%3A_1107_WHITE_PLAINS_NY_10607.  This house is in Westchester, which is a great area but also expensive.  The house is listed at  $469,000.  But I'm saying that I can get it for $450,000 since the seller rarely gets the price they are asking for.  According to an online mortgage calculator, http://www.ginniemae.gov/2x_prequal/le_detail_estimate.asp, I will need a $81,737 down payment on the house in order to get a loan.  This is a bit under 20%, so it is accurate.  I still haven't used my $19,761 bonus from my first year of work, so I'll put that towards the cost of the house.  To pay off the rest of the down payment will cost $7,080 annually for 8.75 years.  However, my salary will probably increase by then so lets say it will take me six years to pay off my down payment.  For my mortgage, I would definitely get it at the bank I am working at, Bank of America.

According to ginniemae, to pay off my loan will cost $2,825 per month for thirty years.  So it will be paid off by the time I'm about 55.  For insurance, according to http://homeinsurance.com/New-York/County-Westchester.php, the average home insurance costs $694.00 per year.  For maintenance, according to http://www.bankingmyway.com/real-estate/home-equity/estimating-annual-home-maintenance-costs, annual maintenance costs are around $4000, or $333.3 per month. I don't think I need to take this out of my budget because I don't own that house yet.

          I talked to my dad about home insurance and maintenance.  He used USAA for his home insurance on his house in Maine.  He couldn't quite remember how much he paid each year, but he said it was around the average ($694.00).  He thinks home insurance is very important because it's not worth the risk of having all your stuff destroyed/stolen.  For maintenance, my dad was pretty good about keeping this budget low.  He didn't have many damages.  For example, no windows broke and no frozen pipes.  Twice the sewer got backed up, but insurance paid for that.  My dad saved lots of money by painting the house by himself instead of hiring a painter, and he re-stained the deck by himself.  So his annual maintenance costs were under $4000, but I might be too busy with work to do that stuff.

          I am still debating over renters insurance, but I'm pretty sure I'm going to get it.  Zack and I would be in a lot of trouble if there was a theft at our apartment, so we want to play it safe.  The average renters insurance in NYC costs $150-$300 a year, so we'll average that and say $215.  Renters insurance protects you from many things, including fire, hail, explosions, aircrafts, smoke, vandalism, theft, weight of ice, snow, or sleet, water related damages, and electrical surge damage.  That's a lot if you ask me!  I increased my salary by 5%, and this will allow Zack and I to get a 55" HDTV and a nice Bose sound system.