Still planning your New Year’s resolutions? Last time, we talked about a resolution for a financial plan for your Smith Mountain Lake home, and your mortgage. This time, let’s talk about insurance and taxes. Owning a home is your biggest investment. Whether you live here year 'round, or own a vacation home, you should make sure you are adequately covered.
For your basic policy, get insurance with full replacement coverage (in case your home should burn to the ground). Don’t forget – you own the land on which the home sits, as well. Make sure your property is covered, as well as what’s inside your home.
Liability insurance protects you from a lawsuit, if someone gets hurt on your property, for example.
Disaster insurance policies are optional policies, and will vary by region. They normally cover flood, earthquake, and hurricane damage. As part of your financial plan, research the specific kind of insurance you need for your Smith Mountain Lake home. Determine what your standard policy covers. Also, look into ways to cut your premiums. These may include structural improvements, as well as belonging to groups such as AARP, and veterans organizations.
Even a great place like Smith Mountain Lake has property taxes, and you should plan for them in your budget (especially since they tend to rise every year). If you pay your taxes from an escrow account, you should still keep track of the increase in your bill. You can ask your tax adviser about deducting your taxes on your federal return, and you can also challenge your assessed value. Do your homework first, by finding out if comparable homes are taxed less. Ask your local assessor what formula is used to set tax rates.
Most of this information is common knowledge for a homeowner, but it doesn’t hurt to take a look each year at where your dollars are going, and how best to make them work for you and your home.
If your plans for the new year include buying or selling a home at Smith Mountain Lake, call Vicki Millehan, the area's local real estate expert, to assist you with your real estate needs.