making the move off-campus – part two

Are you making the move off campus and are curious about additional expenses you may incur and tips for transitioning to life as a home owner? Read on…

Depending on the amount of furniture/belongings needed to be moved, you’ll want to contact a moving company.  Make sure you do this well in advance, especially if your closing/moving date is in peak season (May-September) or on a weekend or the 1st of a month.  The moving company will usually send someone out to the place you are moving out of to estimate how long the move will take and how much it will cost.  Prices range from $500-$5000, and go up from there if you are moving to a different province/country.  If you are moving for a job, ask your new supervisor if moving expenses are covered.

Additional expenses

1. Property taxes – depending on the city your home is located in, property taxes can be paid in instalments directly to the city, or incorporated into your mortgage.  Some cities require one way or the other, so make sure to ask your Financial Advisor about this.

2. Mortgage Insurance – your Financial Advisor will encourage you to take life and critical illness insurance on your mortgage.  This protects you (pays off the mortgage) in case of death or critical illness.  For a person under 30, the monthly fee for both life and critical illness insurance is roughly $50.  NOTE: you do not need to go with the insurance through your bank.  If you are with another company (State Farm, Sun Life, etc) ask your insurance agent what your options are.

3. Don’t forget about that CMHC insurance I mentioned in the previous post.  If your down payment is less than 20% of the purchase price, this insurance will be added to your mortgage total.

4. House Insurance – this is separate from your mortgage, life and critical illness insurance.  This is the insurance policy that will cover the cost of rebuilding your house in the case of major damage (i.e. a fire) or replacing the contents of your home in case of damage or theft.  This will run you about $100 a month. TIP:  If you have a home alarm, you get a discount on your house insurance!

5. Home alarm – your home may already have an alarm and you simply just have to take over the contract from the previous owner.  Otherwise, if you want to have one installed, this will be an added expense.  Most alarm companies charge an installation fee and a monthly monitoring fee.  These fees will vary from company to company and will depend on the level of service you require.  Some of the major home alarm companies in Ontario are: Alarm Force, ADT, Protectron and Chubb Security.

Tips on transitioning to life as a home-owner

– Before you move in you will want to contact the major service providers in your area to arrange for cable, phone, internet, water, gas, electricity, etc. to be hooked up.  If you’re unsure what companies you need to call, ask your Realtor for some help.  Keep in mind that a number of companies charge an installation fee and some require a deposit.  Plan to spend about $500 on these set-up incidentals.

– It’s not a bad idea to have Canada Post forward your mail to your new address while you get settled.  They offer this service for either 6 months (at a cost of $45) or 12 months (at a cost of $75).  Check out their website for more information.

– If this is your first time living off-campus, you will probably need to invest in a number of household items, including some big ticket items.  Ask yourself if you need the following and plan ahead in order to pay for them:

1. Appliances (fridge, stove, washer, dryer, etc)
2. A BBQ
3. Lawn & gardening equipment (lawnmower, weed whacker, gardening tools, etc)
4. A snow blower or shovel(s)
5. Paint & decorating supplies (here’s hoping you don’t have much 1970s wallpaper to remove!)
6. Furniture

– It’s a good idea to re-evaluate your budget after living in your home for at least a month.  At that point, you should have a rough idea of what your bill payments (cable, internet, utilities, etc) will be each month.  If your home is air conditioned and you use it in the summer, this will have an impact on your utility bill.  You’ll soon learn the rhythm of your house and what temperature is comfortable to you.  Even putting the AC up a couple of degrees can help to lower your bill.  This works for the winter too, but instead of putting your heat up a couple of degrees, you’d put it down.

– Also, now that you’re a home owner, it is a VERY good idea to set aside a set amount of savings each month for house repairs and maintenance.  If you’re not familiar with Murphy’s Law, as soon as you become a home owner, you will be! “Anything that can go wrong, will go wrong.”  If you plan for this, when your roof or basement leaks, or your washing machine conks out in the middle of a cycle, it won’t be such a big financial strain.  Your home inspection is a great starting point, but it won’t cover everything.  Basements are prone to leaking.  Foundations will have cracks in them.  Some experts say that a new home owner should anticipate spending 3% of the total cost of their house in the first year of home ownership.  For a $250,000 house, that’s $7500.  After the first year, a home owner will spend an average of 1% of the total cost of their house in a year (on the same $250,000 house that works out to $2500).  Remember, this is just an average.  Your actual cost may be more or less than this.

Overall, owning your own home is an incredible experience.  You’re building equity and get to tailor the home to your tastes.  You’ll never realize how much you loved shopping at Home Depot until you become a home owner! Congratulations, and enjoy this experience.

*Originally posted on the OACUHO blog.

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making the move off-campus – part one

Last week I shared some financial tips for new professionals.  Now it is time to turn our attention to those making the move off-campus and stepping on to the property ladder.

Buying a home is the most expensive purchase you will ever make.  Taking time to do your research is crucial.  There are a lot of incentives for first-time buyers, but there are also a lot of hidden/unexpected costs associated with purchasing a home and maintaining it.

Getting a Mortgage
First, make an appointment with a Financial Advisor (FA) at your bank to see what mortgage you would qualify for.  There is nothing more heartbreaking than searching for a home, finding one you love, then finding out you don’t qualify for the mortgage.  Sometimes an FA will ask if you have looked at any houses and if you have the MLS listing (get very familiar with MLS – www.mls.ca) to use as a starting point.  For example, if you’ve seen a couple of houses that you are interested in, one is $225,000 and the other is $325,000, the FA will see if you qualify for the higher mortgage first.  You’ll also need to know how much money you have for a down payment.  If you have $25,000 to put down, then the mortgage would be $300,000, and the FA will check if you qualify for this amount.  If everything comes back clear, you can get the ball rolling (and let me tell you, once the ball starts rolling it moves FAST).  If you don’t qualify for that amount, the FA will work with you to find a mortgage that you’ll be able to carry.

If your down payment is less than 20% of the purchase price, the Canada Mortgage and Housing Corporation (CMHC) will apply mortgage loan insurance to your mortgage.  Your Financial Advisor will work out what this additional cost will be.  This cost gets added to your mortgage total, and is incorporated into your monthly payment.

Your Financial Advisor will also outline what types of mortgages (fixed and variable), terms (1-5 year), amortization (20-30 years) and interest rates are available.  This link is a great resource, outlining the major terms associated with mortgages: http://www.tdcanadatrust.com/mortgages/glossary.jsp#M

Finding a Realtor
If you don’t know where to start, ask around.  Ask people you know who have recently purchased a home in the area who they used.  Also, try going to some open houses.  Every open house will have a Realtor on site.  You will get a sense of their style (are they too pushy, follow you around the house while you’re looking, or welcome you and let you look around and follow up with you at the end?) and give you an idea of what it would be like to work with them.  Most Realtors at an open house will ask you if you have a Realtor.  If you think they’re too pushy, don’t feel bad about telling them that you do (even if you don’t).  If you seem to like their style, make sure to take their business card, and get in touch with them after the open house.  Most Realtors will meet you either at their office, your current home, or a neutral location (Tim Hortons, Starbucks, etc) to discuss your housing needs and what services they can provide.  Once you’ve chosen a Realtor, you will sign a contract with them, which basically states that they will represent you in your search for a home.  Remember, when you are the buyer, you don’t pay the Realtor’s commission (the seller pays both the selling and buying Realtor’s fees).

Purchasing a Home
Once you’ve made an offer on a home (make sure you’re offer is conditional upon a home inspection) and it is accepted and you’ve had the home inspection completed (and it comes back to your satisfaction), you will have officially bought the home, and be under a legally binding contract.  The sellers will want you to remove any conditions (offers conditional upon a home inspection and financing are the most common) from your offer as soon as possible and you can work with your Realtor and Financial Advisor to do this.

You’ll also need a lawyer.  This is where having a Realtor is great, as they will have contacts and recommendations.  The lawyer will run a title search on your home and property (to make sure there are no leans against it) and organize the land transfer from the sellers to you.  Usually, a couple of days before the closing date, you’ll go in to the lawyer’s office to sign a ton of paperwork, so get ready to sign your life away.  Your lawyer also arranges all of the finances associated with the purchase of the home, so when you go in to sign the paperwork, you’ll take a draft or certified cheque for the amount of the down payment and the lawyer’s fees.   For first-time buyers, expect to pay up to $5000 for lawyers fees.  On the day of closing, you’ll go to your lawyer’s office to pick up the keys to your new home! How exciting!

Stay tuned for part two of this post, where I will share information about additional expenses and tips for transitioning to life as a home owner.

*Originally posted on the OACUHO blog.

financial literacy for new professionals

In honour of National Financial Literacy Month in the US, I thought I would share some tips for those just starting out in the student housing field.  Next week, I will share financial tips for those looking to make the move off-campus (yes, that world DOES exist).

As a new professional, you will no doubt be very excited about your first role.  If your new position requires you to live on-campus, you may face some unexpected expenses, so be sure to ask your supervisor for clarification.  Some incidentals may not be covered by your department, like a parking pass, so be sure to ask so you can plan ahead.  Also, make sure you find out if your apartment is furnished or not.  If not, furniture can be a major expense.  Shop around for sales, and if you are offered hand-me-downs, make use of them.  It’s better to have an older, outdated couch than no couch at all.

If living on-campus is a component of your job, find out if you will pay rent or if your accommodation is a taxable benefit.  If it is a taxable benefit, find out how much will be listed on your T4.  That number can bump you up into the next tax bracket, and you could end up owing come tax time.  If you know this in advance, you can save each month so when you get the bill it won’t be such a shock.

Credit Cards & Student Loans
Often, credit card companies will up your limit without consulting you.  Keep an eye on your statements and if you do not want the increase, call the credit card company and ask them to lower the limit.

You can call credit card companies and negotiate a better interest rate, especially if you are a client in good standing (always pays at least the minimum payment on time, etc).

If you have a student loan from a bank, once you graduate, the line of credit is no longer revolving (meaning that the loan is technically closed and you no longer have access to the “unused” or paid-back portion of the loan).  Talk to your bank about opening a regular line of credit (LOC) and transferring your student LOC to the new LOC if you are interested in being able to access the “unused” portion of the LOC.  Usually a LOC will have a lower interest rate than a credit card and can be a good alternative.  Note, not all banks will allow a student LOC to be transferred to a regular LOC.  Also, student LOCs tend to have a lower interest rate than a regular LOC.

Make sure you update your mailing address information with your bank to ensure you receive your monthly statements.  Or opt for e-bills if your bank offers them – it’s environmentally friendly and regardless if you move, as long as you have access to your email, you’ll always receive your bills on time.  Just make sure to use an email that you won’t change!

Budget & Set Goals
It will be really exciting to get your first full time paycheck, but be smart about how you spend it.  Be pro-active and develop a budget.  Know how much your fixed expenses are (the amounts that are the same every month – car payment, student loan payment, rent, etc.) and anticipate your variable expenses (the amounts that fluctuate each month – groceries, gas, entertainment, etc.).  Set aside an amount that is realistic for savings every month, and add that to your fixed expenses, so you learn not to miss that money.  Some people call this “paying yourself first” and it is truly a good habit to get into.  You’ll be amazed at how much even $100 a month turns into! Be realistic with your budget and don’t deprive yourself.  Make sure to include an “entertainment” line in your budget, to include small luxuries like going to see a movie, going to dinner with friends, etc.

Along with your budget, set financial goals.  Think about the near future (next 3 years) and more distant future (beyond 3 years) and what you want to accomplish.  Do you want to buy a car? Go on vacation? Purchase new furniture? Save for a down-payment on a house?  Determine how much that will cost and work backwards.  For instance, if you know you want to purchase a home in 5 years, and have a $25,000 down payment, you know that you need to save $5000 a year.  Break it down even further…$5000 a year works out to a little over $400 a month.  Can you afford that?  If so, add that to the fixed expenses portion of your budget.  If not, take a look at your goal.  Maybe a $20,000 down payment in 5 years is more realistic.  Do whatever works for you.

Setting, and sticking to, a budget will help put you on the road to financial freedom.  Good luck, and welcome to the field!

What financial tips do you have for new professionals? Share them below!

*Originally posted on the OACUHO blog.

the job search – part one

February is synonymous with job searching in student affairs.  Many housing professionals are busy recruiting and selecting candidates for their 2012-2013 residence life staff team.  February also marks the beginning of the job search season.  Institutions that know they will have vacancies in the spring will post early, in the hopes of recruiting the best and brightest candidates.  So if you’re hoping that 2012 will bring you a new job, get ready to start your search.

Before you even begin your search, think about the type of position you are looking for.  Consider your areas of interest, your strengths and challenges, your supervisory style, your location preferences, your values, and your non-negotiables (the things you are not willing to compromise on).  Keep in mind that the “perfect job” doesn’t actually exist.  Give and take are a part of every job, but knowing what you are looking for in a position and institution will help you to find a good fit, and lead to you being happier in the role.  So take the time to think about this.  Write it in a journal.  Talk to your nearest and dearest about it.  Make sure you know what you want.  Shakespeare said it best: “To thine own self be true.”

In part one of my series of posts on the job search, I’ll offer some tips and resources to help you get started on your search and building a stand-out resume and cover letter.

Websites
Gone are the days of pounding the pavement looking for a job.  Most (if not all) institutions now post their job opportunities on their websites.  To save you bookmarking hundreds of institutional HR sites, here are some streamlined options for a search in student affairs/housing/residence life:

Academic360 – allows you to search institutional HR job announcements by geographic listing, or alphabetically.  You can also search general listings, or specific positions by functional area.

CACUSS – lists current student affairs job postings across Canada.  Note: you need a login to view position details.  You can purchase a student membership to gain access to this information.

HigherEdJobs – lists current global postings in higher education.  Use the search parameters to narrow your search.

OACUHO – lists current housing job postings across Canada.  Note: you need a login to view position details.  You can purchase a student membership to gain access to this information.

Resume & Cover Letter
The purpose of the cover letter and resume is to get you to the interview stage.  You do not need to share your life story, just enough to convince the hiring manager or committee that you’re worthy of an interview.

Tips for crafting your cover letter:

  • Read the job posting and job description carefully.  If the full job description isn’t attached to the posting, email HR and ask for it.  Highlight what you think to be the key areas and responsibilities of the job.  Make notes on any experiences you have in those areas.  Work those experiences in to your letter.
  • Know who to address the cover letter to.  It should be easy to identify who the position reports to, but if this is not the case, send an email to HR to find out.  It’s much better to be pro-active and address the letter to your future supervisor, than simply addressing it to “whom it may concern.” This shows you’ve done your research and are paying attention.
  • Be a spelling and grammar critic.  Common word processing programs may pick up on misspelled words, but they will not determine between there, their and they’re.
  • Know that your first draft is probably not your final draft.  Send your cover letter to a few key people (preferably those who conduct hiring processes and can pick out a good cover letter from a not-so-good one) to seek feedback.
  • Keep it clear, confident and concise.  Use plain (read: understandable) language, show confidence in your abilities and try to keep it to a page.  Again, this isn’t the place to tell your life story.  Think of it as a “teaser” campaign.  Your goal is to hook the reader in to wanting to know more about you (hence, landing you an interview).

Tips for rocking your resume:

  • Ensure that your contact information is clear, up-to-date, and appropriate.  Signing up for a free email account to use strictly for your job search is a great idea.  YourName@gmail.com (or free email provider of your choice) is an example of an appropriate email address.  PartyGurl2012@hotmail.com, not so much.
  • Showcase your education, experience (professional, para-professional, volunteer), significant accomplishments, qualifications & training, and other skills that are relevant to the position.  You should tweak your resume to suit each position you apply for.
  • Size matters.  Two pages is the traditionally accepted norm for a resume for an entry-level position.  If you’re going after a job with more responsibility (i.e. a mid-level or senior position) then your resume should reflect this.
  • Just like the cover letter, be ruthless with your spelling, grammar and word usage critique.  An innocent (yet careless) error can take you out of the running for a position.
  • Play around with different layouts until you find one that you like, looks professional and is easy for the reader to navigate.  Don’t simply rely on common word processing resume templates.

For further reading on these topics, check out these articles:
Ten Resume Mistakes to Avoid
Tips for a Better Resume and Cover Letter

In part two of the job search series, I’ll talk about staying organized during your search, and provide tips and resources for preparing for the interview.

What other sites do you use for your student affairs/housing job search? How do you ensure your cover letter and resume are top notch? Share your thoughts below, or continue the conversation on Twitter.