How much should I set aside each month for repairs and replacements?

Percentage rules of thumb for maintenance are easy to quote and impossible to defend, because they take no account of whether your boiler is one year old or fourteen. A schedule built from your own house takes an hour, produces a figure you can justify, and turns the two events that most often force households into debt — a boiler failing and a car needing serious work — into an expected withdrawal from a pot that already exists.

Step by step

1. List everything expensive that has a finite life.Boiler, roof covering, windows and doors, kitchen, bathroom, flooring, external decoration, washing machine, fridge freezer, oven, dishwasher, tumble dryer, car, mattress, sofa, computer, phone. Include anything you would have to replace rather than do without.
2. Note each item's age, or your best estimate.Installation dates are often on servicing paperwork, on a label inside the appliance, or in the survey from when you bought the house. Estimate where you have to — an approximate schedule beats no schedule.
3. Write the typical service life next to each.Use the manufacturer's expectation where there is one, and the general life for the type where there is not. Be conservative: a heavily used item reaches the end of its range sooner than a lightly used one.
4. Work out the years remaining and the replacement cost.Life minus age gives the years remaining, with a minimum of one for anything already past its expected life. Use today's replacement cost, delivered and installed, not what you originally paid.
5. Divide each replacement cost by its years remaining.A boiler costing £3,000 with five years left is £600 a year. Do this for every line. Items already past their life go in at the full cost over one year, which is what makes the list honest.
6. Add the annual figures and divide by twelve.That is the monthly provision. It will look large. It is large because replacing the contents of a house is expensive, and the alternative is not that it costs less — it is that it arrives as debt.
7. Set the standing order and leave it alone.Into a separate account so it is not visible as spendable money. When something fails, the money is there and the event is an inconvenience rather than a crisis.
8. Update the schedule once a year.Cross off what has been replaced, reset its clock, and adjust the costs. Ten minutes at your annual admin session keeps the whole thing accurate.

Tips

• If the full figure is unaffordable, fund it partially and prioritise the items closest to failure and most disruptive to lose — heating and hot water first, then anything that would cause damage if it failed.
• A survey from when you bought the house is a ready-made schedule of what was near the end of its life. Dig it out rather than starting from scratch.
• Keep this pot separate from your emergency fund. One is for known replacements, the other for genuine shocks, and merging them means the emergency fund is quietly spent on a washing machine.

Common mistakes

• Using a flat percentage of the property value — It ignores the actual age of everything you own, which is the only thing that determines when the money is needed. A new-build and a house with a fifteen-year-old boiler need very different provisions.
• Keeping the provision in the current account — Money visible in a current account is spent. A separate account with a name on it is the entire mechanism by which this works.

Questions people ask