Moving? Expect 90 draining days for your wallet

Moving soon? Like most, you’ve been focused on the initial costs — for renters, that’s coming up with first and last month’s rent on your new place and patching and painting any holes in the walls of your current dwelling, for example. For buyers, it’s things like consolidating the final sums for your down payment and paying for legal and closing costs. And, for both, it includes paying for movers, boxes, bins and a truck if you plan to DIY.

But what happens to your finances after you move never gets enough attention. The first 90 days in your new place can be loaded with one-off expenses and setup costs. To avoid the financial shock, here’s how to prepare.

Negotiate hookup and ongoing utility fees and insurance

Once the keys to your new place are in hand, you’ll immediately want to turn your attention to switching over the utilities — gas, hydro, waste, water, internet, cable, alarm systems and so on — and establishing new tenant or homeowner insurance. If you own a car, your auto insurance could be impacted too.

Work through this list methodically, and document the utility hookup fees and the new ongoing costs of each bill (these should be factored into your regular budget). My advice is to attempt to negotiate the rates and fees on all of these items, and don’t forget to cancel your old utilities and insurance (unless you still rent or own the former property). Shop around for the best deals and set up automatic payments from your bank account on the day these bills are due; that way you won’t forget to pay them.

Build a list of less urgent needs, and plan to space it out

Do everything in your power to avoid hefty credit card bills in your first few months; moving is expensive enough (research shows that moving day alone runs upwards of $1,600)! You probably don’t need to clean your furnace ducts on day one. But build it into your 90-day road map. The same goes for buying furniture to fill your space — go slowly and consider purchasing second-hand. Tasks that you may have originally planned to outsource — yard maintenance, a deep clean of the home, painting and so on — can be done by you instead.

Once you have a list of what you need, you can tally up the costs and space it all out. Ideally this will let you pay for the items with your regular cash flow or savings, versus with debt.

And if you’ve got a hankering for immediate renovations and home improvements, ask yourself if they can wait. Holding off can remove stress and also gives you the opportunity to get to know your new space better, which can help you optimize the ultimate renovation.

Planning to work from home? Prioritize a healthy workspace

Your personal well-being is essential. That means ensuring you’ve earmarked money for any tweaks you might need to make to your home office. Buying a new chair, lamp and desk all at once might not be in the cards right away, but put it on your 90-day road map and look for deals. These expenses should probably come before, say, a new backsplash in your kitchen.

The initial grocery shop and cleaning supplies

Most people making a move leave one empty fridge behind and arrive at another. And unless you have piles of cleaning supplies from your previous home (maybe from last spring when you went wild stocking up for the first lockdown), you’ll need to grab these items, too. This means your first few shops can easily be double the normal cost. Rein it in by sticking to what you need.

The secret sauce is meticulous budgeting for 90 days

Before you know it, rent or your mortgage will be due, and utilities and other expenses like condo fees will have to be paid. The number one tip I can give you is to set up a new, refreshed budget that has ample flexible spending room for the coming 90 days. Second to that, just lay low for a few months.

The ongoing budget benchmark for housing costs is approximately 35 per cent of your take-home pay, and another 20 per cent for food, restaurants, home- and child-related expenses. It’s also important to note that wellness spending should be factored in, too — moving is a big deal and you might need to speak to a therapist, get a chiropractic adjustment or more. Recent polling says Canadian households are putting about $275 per month of their household budget to the wellness category, given these unprecedented times. Work over time toward building up savings for both emergencies and planned big-ticket items (another five per cent can easily go to the savings category).

If you find yourself totally financially tapped out during your first 90 days, know that this is normal, and that it’s going to get better. It just takes a bit of time for your cash flow to level out. If you need to pause your investment or savings contributions for this brief period of time, go for it. Just remember to restart your automated contributions after 90 days have passed.

This article was originally published in The Star. Lesley-Anne Scorgie is a Toronto-based personal finance columnist and a freelance contributing columnist for the Star.