How to Plan Ahead for Winter Expenses

As soon as the last piece of Halloween candy is given to trick or treaters, Santa Claus comes to a shopping mall near you and holiday music begins playing nonstop on the radio. Seasonal change is as reliable as the sunrise, and so we should make having a budget for those changes a part of our planning year-round.

While it may be true that “it’s too early for this,” as many of us declare, it’s definitely not too early to plan for your winter expenses. In fact, since the whole point of financial planning is to work ahead, you may be a bit behind. After all, it’s beyond inconvenient to find out your snow blower won’t start when there’s a foot of snow on the driveway.

The good news is, it’s not too late to get started. And a CFP® professional can help.

Home Winterization

Outside of holiday shopping and travel, winter expenses largely involve your home. Many arise during the process of winterization — that is, the steps you take to prepare your home for colder temperatures and potentially harsh seasonal conditions. Some of these steps are relatively easy and cost-free: putting away hoses and sprinklers, turning off the water supply for exterior spigots and hanging your storm doors and windows.

Others require more time and involve potentially greater expense. For example:

• Inspecting your furnace annually, including tests to confirm that it’s not leaking carbon monoxide.
• Checking that your water pipes are properly insulated, especially pipes in colder places that are particularly susceptible to freezing and bursting.
• Cleaning your gutters. Clumps of leaves and pine needles can prevent water from draining, leading to a heavy buildup of ice that can damage your gutters or cause leaks in your house.
• Checking your attic, windowsills and around electrical outlets for any air leaks, and filling those gaps with insulation.

You should also ensure that your roof is in good condition before snow falls (though ideally you did this in the warmer months, because it can be difficult to get a professional to make repairs in winter).

Some fixes you may be able to do on your own, but others will require a contractor’s help. A CFP® professional can help you estimate and budget for these and other winterization costs.

Heating Bill

Your heating bill is typically another big-ticket winter expense, especially if you use oil or gas to keep your house warm. There are money-saving ideas that could help you keep your energy costs down, such as installing a programmable thermostat that regulates the temperature. Or, if your budget allows, investing in an alternative heating system, such as a pellet stove or solar heat, to save money over the long term.

Homeowners Insurance

When the leaves start to turn, it’s as good a time as any to confirm that you have active homeowners insurance and verify what your policy covers. According to the Insurance Information Institute, winter weather caused $17 billion in insurance losses in 2021, as a result of one of the worst icy blasts ever recorded.

You should also check with your insurance company about whether your area has any peculiar weather anomalies that might negate or prevent your homeowners insurance from covering a claim. And be sure to review your policy’s terms for water damage, which is considered the second most costly type of homeowners insurance claim. (Note: Properly winterizing your home lowers the likelihood that your insurance provider will reject a claim for neglect.) A CFP® professional can help you check what you’re paying for and determine if you should purchase additional insurance.

Emergency Fund

While planning ahead is ideal, sometimes the winter throws you a curveball. Maybe you had your snowblower inspected before the seasons changed, but you ran over a rock at the edge of your driveway and broke its auger. Maybe your area got hit with an unexpected ice storm that caused lengthy power outages, and your family had to seek refuge at a nearby hotel or invest in a generator.

This is where your emergency fund comes in handy. A CFP® professional can help you confirm how much money should be in this fund (typically three to six months’ worth of living expenses in cash or cash equivalents) and build it up if necessary.

Other Budget Items

There are important winter expenses outside of your house to consider as well. Do you need snow shovels, windshield scrapers, or salt or calcium chloride for your driveway? Does your vehicle need new and/or snow tires? Do you need to pay for backup child care or day camps when your children have a snow day? It’s important to incorporate these basic winter weather expenses into your budget, too.

Winter brings its own beauty as well as its unique challenges, but it’s not the only time of year when thoughtful budgeting and early planning are prudent. Every season involves different expenses that should be incorporated into your short- and long-term plans. A CFP® professional can help you think through these financial considerations and build a comprehensive plan that keeps you on track to achieve your goals, no matter the season.