How much money should be left after buying a home?

Trojin

Hi everyone I was wondering if you could help me, how much money should be left after buying a home? This is for buying future and a substantial float in case of redundancy and other issues. Should there be a certain percentage? I'm asking as I'm in the process of buying a house and I'm concerned about the money that should be left over after everything else is paid for.

DannyboyMidlands

Depends on many things, including your attitude to risk. For emergencies FA's often advise 3 months take home pay in easy access accounts but I reckon this is a bit low.

From my point of view, in case of redundancy I wanted at least a years worth of mortgage payments and a larger lump sum to pay down the cheap tracker mortgage should interest rates rise.

Furniture will totally depend on your tastes. There's some good cheap stuff available secondhand if you'd be happy with that.

anyusernamenottaken

A years worth!?!? That could run in to tens of thousands!

If you can do it great but me personally I'd put down as much deposit as I could in order to get a more favourable LTV.

I imagine everyone buying a place for the first time will be skint for the first 6 months until the coffers start to refill. I certainly will be!

wongjoebon

I think a year worth is sensible enough if you are the sole income earner. If your partner earns too then may be half that amount assuming her/his salary will be able to pay off the mortgage and u can spend on items with the left over savings.
Also depending on whether u need monies for furnitures and other decors obviously

DannyboyMidlands

anyusernamenottaken wrote: »

A years worth!?!? That could run in to tens of thousands!

If you can do it great but me personally I'd put down as much deposit as I could in order to get a more favourable LTV.

I imagine everyone buying a place for the first time will be skint for the first 6 months until the coffers start to refill. I certainly will be!

That's why it depends.......

My mortgage is cheap, waaaay less than £10k per year, and my job is vulnerable (most recently laid off in 2009), hence wanting a years worth of payments.

I can get a much better savings rate than improved mortgage rate for the lump sum and it's available if neccessary. It also made me comfortable enough to gamble on a cheap tracker rate, knowing that I could cover any rate rises.

I wasn't skint for the first 6 months. Might as well save for 6 months longer and not be skint is the way I'd look at it. No need to spend every last penny.

Beckyy

About 3 months worth for me.

A year is v.sensible, but most people would never buy if they had to save a years worth of repayments AND a deposit too.

breadlinebetty

I'd say 3 months is okay.

As for furniture look on ebay.....when you're first starting out you expect to compromise - you make it all lovely and to your style as time goes on:)

englandcrew

Im currently going through the process of buying my first home. Im putting as much deposit as I can down whilst leaving myself with two months money. Any extra left after that, which will be minimal will go on cheap furniture.

My plan is to then but decent furniture and safe over time

girl_withno_name

When I first moved into an unfurnished property (rented), we got all our furniture from Freecycle and even then we pretty much only sorted the basics (fridge freezer, washing machine, bed and sofa).

cattie

I'd say minimum of 6 months in this day & age, though personally I like to have at least a years complete expenditure behind me as I don't have anybody who could bail me out of any problems that could come along.

Are you taking out income protection insurance? Always advised if you can afford it.

drummer_666

I'm buying a house on my own.

Not worried about having anything in reserve AT ALL. I'll be paying rent and mortgage for 1 month, maybe 2.

Will have about £1k spare after money allocated for new boiler and double glazing.

But I will also have Income Protection Insurance in place. If I lose my job within 3 months I won't get a payout, but I have a months notice from work anyway. Job seekers would actually cover 70% of my mortgage too. After the first three months of the policy my Income Protection Insurance will pay out enough to cover my mortgage, all of my bills, my food and a bit extra. And it costs £18 a month. That's with 0 days waiting time. Gives me piece of mind for not a lot of cost

I will also have my housemate moving in, which what he'll be paying will cover my mortgage in full. But worse case and he moves out, I'll survive on the Income Protection Insurance.

Although I do have my own furniture, washing machine, fridge, freezer etc as am renting unfurnished. I will be getting other stuff off freecycle and painting it up to look funky.