Tired? Hire somebody
The time and effort required to keep your new home looking good can become overwhelming. After all the grass cutting, snow removal and house cleaning, you might decide that you've had enough and want to hire some help. This help costs money. Lots of money. So let's take a look at some of those expenses.
Hiring help will certainly give you some time back in your day, but the cleaning lady, landscaper and pool boy don't work for free. Don't forget about the guy who picks up after the dog, the one who power washes the house and cleans the windows and the guy who puts that fresh coating of protectant on your driveway when it starts to look faded.
Before you go inside to take rest and figure out how you're going to pay all of your new helpers, take a quick look at the garage or rather what's in it. In addition to that upscale house you or your husband will probably want a new set of wheels to park it in that fancy new "man cave." You don't see many Yugos or Dodge Darts parked in front of those upscale homes.
The car is the largest expense associated with the garage, but it isn't the only cost. Fancy storage units, specialized oil-resistant flooring and even flat-screen TVs can be found in the modern garage.
Like everything else associated with moving up in the world, all of it comes with a price tag.
Let's go inside
Your miniature palace and the toys its holds will need to be protected. The alarm company will probably install the system for free because they make their money on the monthly service fee.
Now that the exterior looks good and the interior is protected, you've got a house full of big rooms that need to be filled. Just as the scale of the rooms changes so does the scope of the furniture.
What's a coffee table worth to you? $40 or $400 or $40,000. They are available in all of those prices. What about lighting figures? $25 or $2,500 or $25,0000. You can get the low-end one at the local big-box store and the other two at the boutique lighting establishment in the good part of town.
Time and money in another dimension
The basic costs in terms of time and money also apply as the property ages. Maintenance and repairs come in proportion to the size of the property.
A new roof on a large home costs more than a new roof on a small home. New carpeting in a large home can easily cost tens of thousands of dollars. Repairs to stone and stucco can put a serious dent in almost any budget. Remodeling a large kitchen costs more than remodeling a small kitchen. Updating a large bathroom costs more than updating and small bathroom, and so on. As time passes, you'll also encounter an expense that may come as a surprise.
After you make the final mortgage payment and you've thinking "free at last!," the tax man will be saying "not so fast." Even after the mortgage is paid, taxes are forever, and the taxes on that big new house can be the equivalent of a mortgage payment on a smaller property.
Test the theory
Now that you're thinking about the costs associated with your move, it's time to create a "big house" budget. Before you buy the big house, live with its expenses for six months. Allocate your money accordingly. This exercise will drive home the value of truly understanding your finances.
While this may seem like a lot of effort, it is really just a fiscally prudent approach to the lifestyle enjoyed by the upper middle class. Remember, the truly wealthy also have to pay for personal assistants, professional chefs, arborists, butlers, nannies and sometimes even personal security.
In a 2012 article about affluent bankers, the Wall Street Journal noted that the lifestyle requirements for a family of four (Manhattan apartment, staff, private schools for the kids) "can easily top $500,000 a year." The article noted that "restaurants, clothing, second or third home upkeep and charity dinners" cost extra.
Okay, you've gone beyond the obvious and taken a serious look at the costs of moving up. You've tested the theory, found it wasn't too difficult to stash the cash, and you are now ready to move. If you've planned just right, your future will be filled with cozy winter evenings sitting by the roaring fire and lazy summer afternoons relaxing poolside with your friends instead of fretting about expenses.
