Don’t Let Surprise Expenses Stop You from Contributing to your Child’s RESP
As a homeowner one of your worst nightmares is damage to the home you’ve worked so hard to afford. Unfortunately, I know this far too well. I’ve been living this reality for the last month.
Dealing with the Windstorm
Friday, May 4th, 2018 is a day I won’t forget anytime soon. This Friday started out like any other ordinary Friday. It was a long work week, so I was looking forward to relaxing over the weekend. Then, the weather threw me a curveball. There was a wind warning suddenly issued in Toronto. I didn’t think much of it until I went outside and realized how windy it truly was. I was almost blown off my bicycle on the way home!
When I arrived at home, it was a homeowner’s worst nightmare! The strong wind had lifted shingles off my roof and tossed them down the street. Luckily, one of my neighbours (who is a roofer) was nice enough to get up on my roof and nail down the lifting shingles to prevent further damage.
Once the windstorm was over, I surveyed the damage. Although I fared better than some, my roof needed immediate repair. Getting a roofer at this point was a challenge. I phoned around without much luck until I finally found a roofer who was willing to come by my house and repair the roof. When all was said and done, it cost me $500 to repair the roof. This expense was a total surprise. There is no way I could have predicted this would happen, but it did.
Preparing for Surprise Expenses
Life has a way of throwing us curveballs. If it’s not your roof needing repairs, it will be your car breaking down or suddenly getting laid off from work. Although you can do things to help prevent these potentially financially devastating events, like properly maintaining your vehicle, it’s more important than ever to be prepared for the unexpected. If you’re not prepared, it can easily derail your financial goals like saving towards your child’s RESP.
Financial experts recommend setting aside three to six months’ living expenses in a high-interest savings account. But that’s a lot of money, especially if you’re a cash-strapped homeowner. If you can’t afford that much right away, don’t panic. Start small. Save $50 or $100 per month in a rainy day fund. By regularly contributing, before you know it you’ll build up the necessary emergency savings.
That way, when the next windstorm hits, you’ll be well prepared. You won’t have to sacrifice contributing to your child’s RESP and receiving the free government grant. You’ll have the money to take care of the emergency home repairs there waiting for you.
By preparing for the unexpected, you won’t let a single surprise expense derail your ultimate financial goals.