6 Ways to Save Money in Your HOA
Who doesn’t like to save money, especially in today’s challenging economy. In a homeowners association, every dollar you save could avoid higher assessments. And, that puts money in your pocket.
Don’t go with the flow when you prepare your annual budget. Think outside the box instead of going with what’s been the norm for years, and you’ll probably find some ways to save a little here and a little there. It all adds up to make a substantial difference. Here are some areas to review when you’re looking for ways to save in your association.
- Explore Insurance Options: This is one of the largest expenses in an association. Maybe it’s time to explore ways to save. Don’t assume that every company is the same rate or coverage. Check with other insurance companies to learn how the premiums and coverage differ. Another way to reduce premiums is to raise deductibles.
- Bid Your Vendor Contracts Regularly: Even if you are happy with your current vendors, you should bid vendor contracts regularly. Market prices can change for services and products, so an annual bid process has the potential to save you money. Make sure you obtain apples-to-apples proposals so you can compare the bids easily. Most existing vendors will work hard to reduce costs and keep your business, so you can look at renegotiating a more favorable contract.
- Control Utility Costs: Put timers or motion detectors on lights to save money on electricity. Energy efficient light bulbs last longer and save energy. Check your phone bill for unneeded services or erroneous charges. If you have a swimming pool, make sure you aren’t paying a sewer charge since the water doesn’t go into a sewer.
- Invest in Preventive Maintenance: Don’t overlook the savings that comes with regular property maintenance using quality materials. Sometimes you may need to spend a little more money in the short term to save more long-term. By addressing issues early and developing a regular maintenance checklist, your community will save bucks in the future.
- Manage Legal Costs: Legal costs can quickly escalate out of control. While you need to make sure that your HOA follows the law, there are times when a legal expense may not be justified. For example, a lien may be more economical than a lawsuit when a delinquent homeowner is in the middle of bankruptcy or foreclosure. Talk with your attorney about cost-effective options.
- Negotiate Volume Discounts: Larger associations can save money on waste removal, cable, Internet and phone services. These communities may be able to get a “rebate” from service providers simply because the association negotiated a volume discount for the owners. Ask about volume discounts in your area.
There are many ways to stretch your dollars when you think about the buying power behind a community association.