Your Housing Budget: 5 Tips to Manage Today’s Financial Challenges

While each person’s housing dream might be different, today’s financial challenges such as rapidly rising interest rates might cause some people to put those dreams on hold.

It’s understandable why people might feel anxious. A recent NFCC and Wells Fargo poll showed that 26% of Americans are more worried about meeting basic household expenses compared to 12 months ago.

Check out tips that can help people get a handle on their overall budget, even in the midst of rising prices and financial uncertainties:

• Is there a realistic plan for the money that comes in each month?   Be sure there is a line item in the monthly budget for key living expenses like housing, groceries, healthcare and medications, car maintenance, savings, as well as gas.
• If a household hasn’t been following a budget, take time to create one no matter how simple to track expenses in order to go back, review and adjust as needed.

• Most people find they are spending more on the essentials — housing, healthcare, food, insurance, utilities and transportation.
• Consider temporarily paring back on travelling, gifts, restaurants or other discretionary expenses.
• Are any major purchases on the horizon? Is It possible to postpone major purchases like an appliance or other large item?  If a washing machine or other major appliance needs to be replaced in the coming months, try to set aside cash now. So when the time comes to replace it, using credit isn’t the first option.
• Shop smart at the grocery store. Plan meals and shopping lists. Stock up on staples. Use coupons and discounts. Take advantage of discount gas prices, bulk grocery prices and other low prices available from membership stores.

• Is monthly cash outflow greater than monthly income? Consider supplementing income with part-time work or a side hustle. Use career skills for freelancing, consulting or contract work (see what’s possible through websites like Upwork, Guru, Fiverr or Freelancer).
• Turn a hobby into an income stream –writing, crafting, photography, art, cooking/baking. Become a Lyft or Uber driver or Doordash delivery. Consider temp work as a customer service rep, or childcare, housesitting or pet sitting, or an online tutor

• Some homeowners might be looking to sell their home at today’s high home values and buy a smaller home (with lower utility costs, property taxes, insurance, etc.) or relocate to a less expensive area.
• For seniors, reverse mortgage is an option available to homeowners age 62 and older to borrow against their home’s equity without having to make monthly mortgage payments.
  • Seniors can choose to take funds in a lump sum, line of credit or through structured monthly payments.
  • This type of mortgage can help with expenses and home repairs when the borrower is living on a fixed income, helping homeowners to age in place.
  • A reverse mortgage can be a sensible option for seniors with sufficient income to cover basic expenses, including property taxes and insurance, who want to live more comfortably in their home as they age in place.

• Many people find it hard to manage rising prices when struggling with high credit card debt or other debt.
• The longer a borrower carries a high interest credit card balance, the bigger bite it takes out of available monthly income.
• A trusted national nonprofit agency like 995Hope can help you figure out what your entire budget looks like, including managing debt payments against monthly housing costs.

If homeowners or renters feel anxious about their finances in the face of rising prices, overwhelmed with debt and unsure how to manage housing costs, the 995Hope Hotline is ready to help. Certified trained counselors look at people’s entire financial picture and suggest options tailored for each situation.