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Modern House


Why You Need An Emergency Fund When Buying A Home

When most people think of homeownership, I can guarantee the words “emergency” and “fund” don’t even make it in the same sentence, So that’s why I thought it would be good to not only go over the importance of having an emergency fund, but bring you some real life experiences I had with my home, and why I am glad I had an emergency fund.


When most people think of homeownership, I can guarantee the words “emergency” and “fund” don’t even make it in the same sentence, So that’s why I thought it would be good to not only go over the importance of having an emergency fund, but bring you some real life experiences I had with my home, and why I am glad I had an emergency fund.

Believe me when I say this, I know buying a home is very exciting, not only do I see it everyday with my clients, I have experienced it myself too. Sometimes when you get overly excited or anxious to get the keys to your new home, your morals and standards are covered with a curtain and thrown out the window.

Even being a real estate professional like myself, I admit I bit off a little more than i could chew with my home because I was so fixated on a few awesome things about my home that everything else fell under the category of “pshh that’s not a big deal” when in reality it most certainly could’ve been. Just a side note, I won’t dive into all the good, bad, and ugly details about buying my home because I already made a video about it that I will link in the description.

My girlfriend Elena and I saved much more money than we needed to in case we were faced with stuff dying on us. Especially in today’s housing market, it would be a better financial decision to buy a home that needs a little more work than to buy something updated all the way and at a premium. Our house didn’t have an A/C, so that’s something we kept in mind to set money aside for.

The furnace seemed to be on its last leg and the last thing we wanted to do was have it die right in the middle of the winter so we replaced it at the same time we got a new A/C put in to make that whole process much more seamless as an heating and cooling expert would say. The first day we moved in, we put everything in our closets like any homeowner would and the whole closet collapsed. It was that rinky-dink wire shelving, but it tore all the anchors out of the wall and we had to not only mud and paint the closet, we bought a closetmaid closet kit because we didn’t have the tools or the time at the moment to build an extravagant closet.

On top of that, the garage roof started leaking and we figured out the ridge cap shingles were essentially torn to shreds causing water to run down and sneak its way into the nearest nail holes. Next, with a few Michigan rains, we noticed water was getting into the crawlspace through the access as there is a negative grade in front of it causing the water to basically flow right in. Yes, I did catch this during the open house and inspection, but I didn’t know how bad it actually was until it rained.

So I purchased a metal ring, pea pebbles and some other materials so I can make the terrain a little friendlier by the house. We also found a lovely puddle in the making at the front of our refrigerator, with the assumption it was a goner, we found that the defrost tube was completely frozen and wasn’t allowing any water to pass through, so we chiseled away at the ice, poured hot water down it and wrapped a copper wire around a coil to drop 2-3 inches down the tube.

Since the coil gets hot and copper is a good conductor of heat, this turned out to be an Einstein DIY project that didn't empty our wallet. Then a few short weeks later our water completely stopped flowing from the tap. We are on a well, and assumed that we would need a new well pump and pressure tank. Luckily, all we had to do was add some PSI to the pressure tank, and replace the pressure switch on the well pump for a whopping $20.

All of this within the first two months of living in our new house. I don’t say these things to brag about how much we have accomplished or how smart I think I am, I say these things to not only show you the true reality of homeownership, but the unexpectedness of stuff going bad, and why you shouldn’t always feel the need to call out a professional.

I am nowhere near a jack-of-all-trades, but I am slowly becoming one, as I take on new projects around the house. Do yourself a favor and invest in your knowledge, take the time to watch a YouTube video, read a blog post or a how-to guide to help you solve issues that you thought were massive, that could be taken care of or a simple piece of copper wire, but full disclaimer, if it is a safety hazard, of course consult with a professional to get it taken care of. Nonetheless, None of this would’ve been possible if we didn’t set up an emergency fund.

What I’m trying to say is, even me, a realtor, let my guard down and let my emotions dictate my decisions. There of course is nothing wrong with that, but that means you need to make a point to set yourself up earlier before you make decisions you’ll think twice on down the road.

By that I mean, an emergency fund. An emergency fund, is A/C on a 90 degree day, it’s a furnace on a -10 degree day, a water heater for your warm relaxing baths, and a friend that will always be there when sh*t hits the fan.

It’s impossible for me to put more emphasis on the importance of an emergency fund than I already did. I understand that you may be limited on funds, I understand you want to put more down on the house to pay it off quicker. Believe me, I understand your reasoning for allocating your excess funds elsewhere, but there most definitely isn’t any comfort in knowing you have a credit card bill you can’t even pay off each month because you neglected to create some kind of emergency fund.

It doesn’t need to be anything massive. I have had real people come up to me and tell me there’s no way they could put $20,000 in their emergency fund as a first time homebuyer while having funds to put toward closing costs and a down payment. You most definitely do not need to have $20,000 in an emergency fund, is that a good goal to aim for? Of course, but I would never stretch yourself so thin unless you were able to.

A general rule of thumb is to set aside 3-6 months of basic living expenses in an emergency fund. 3 months is just fine when you’re buying a home, but do yourself a favor and contribute a set amount of money into that fund with each paycheck every month just in case. If you have no idea where to start with this, hit the link below to have immediate access to your own personal emergency fund workbook created by yours truly to help you have a better understanding of how much money you need to set aside to create a healthy emergency fund. There are some blank spaces for you to add additional items you pay for as well.

An emergency fund isn’t just for the “what if” something goes wrong in the house that you have to replace. What if you or your spouse lose your job that you heavily depended on financially? No problem, you have 3-6 months to hunt for something else without the worry of not being able to pay your next month's mortgage payment. Think of it as an insurance policy that protects you against the unexpected.

I hope this rant helped you understand the importance of creating and maintaining an emergency fund for all of life’s wonderful surprises. If you have any questions or are facing hardship with the emergency fund workbook, please don’t hesitate to reach out and I will be more than happy to help out.



Andrew McManamon is a Michigan REALTOR® with Signature Sotheby’s International Realty and provides real estate services to Buyers, Sellers and Investors throughout SE Michigan including Livingston County, Oakland County, Washtenaw County, Genesee County & beyond. Andrew has become one of the rising stars of Michigan real estate agents. Prior to his real estate career Andrew was responsible for managing a senior living facility in Brighton, Michigan as a dining supervisor and an activities assistant. Andrew’s passion to help people is unlike any other, and he continues to strive to be best resource he can be. Andrew graduated from Cleary University in Howell, Michigan with a double major and currently resides in White Lake, Michigan.


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