Tips For Setting Up A Home Renovation Budget

Home Renovation
Home Renovation

1. Find your priorities   

  In this article I will be looking at how you can find your priorities straight when renovating your home. There are many people who, after completing a renovation of their home, discover that they have made many mistakes and have wasted a lot of time and money on an unnecessary project. This is because, although they may have the skill and the expertise required to carry out the work, they simply did not set their priorities straight.

Firstly, you must ensure that you have in place the right priorities for your life. Having a list of what you need in your new home, as well as a list of all the bills that you pay every day, will help you keep track of your expenditure and reduce the amount of time and money spent on unimportant items. Having a home budget is important because it will help you understand exactly what you are spending your money on each month. Once you have this understanding, you will be able to make the most of renovations but you should also understand that your priorities change from month to month. You should also try to identify which expenses are essential and which are unnecessary.

Secondly, you should consider your lifestyle and your habits. This means that you should create a daily routine that you follow and make sure that you make your home as comfortable as possible. Although this may sound too simplistic, many people end up spending a lot of money on renovating their homes, only to abandon it after a while due to boredom. If you are living in a place where you are used to spending your time in front of the TV or in bed, then prioritizing your life will be a lot harder.

Thirdly, consider the aspects of your life that you are least likely to prioritize. Most people fall into the trap of spending money on things that they may very well be able to afford, but are not so important for others. It is therefore advisable to spend money on some aspects of your life that are important to you, and to reduce your spending on other aspects of your life. This can be done by saving money, investing in things that are important to you, and making sure that your home is as comfortable as possible. By doing this, over time, you will find that your priorities have changed. You will no longer spend money on things that you could do without, and you will start to look after those that are more important to you.

A further way to make your priorities straight is to sit down and write them all down. Although this may sound like a strange way to go about prioritizing, by actually writing down your priorities, you will be able to see which things are more important than others. This way, if you ever find yourself having an emergency, you won’t be tempted to cut costs in any way. By deciding your priorities, you will become more efficient at managing your finances.

The third way in which a lot of people forget their priorities is when they set them up, but forget to implement them. For example, many people set up financial priorities by looking at the total debt that they owe. However, I would argue that unless you consider the total value of all of your assets, which includes your home and possessions, then you really don’t know your true financial priorities. You might not be aware of it, but you are probably living in the illusion of having zero debt! You should actually calculate your debt relative to your income and then see if it is something that you can actually afford.

 2. Cost vs. Value   

When planning any home improvement project, it is important to know whether you are planning to sell your house at some point, or if you plan on living in it. You need to know what your options are going to be when it comes to cost vs. value. So how do you determine what a house project will cost, and what type of value it is going to bring to your house s potential sale? And if that is the only factor that drives your decision on whether to renovate, then why should that be the sole determining factor? It just makes sense to have both cost-effectiveness and value when renovating your home.

The first renovation discussed here are the most expensive renovations, which are typically required to bring the whole house up to code. These renovations include everything from new flooring to new bathrooms, kitchen, and basement. These are usually the most costly, but also the most time consuming. You must also plan how to get these renovations completed within budget, because if they are not completed according to plan, then there is a very real chance that they will not be resale worthy.

Now, let’s talk about master suites. A master suite is, quite simply, a separate room with it’s bathroom, attached to the master suite. They are prevalent in condominiums, but can also be found in older homes. The cost of a master suite renovation typically falls in two categories. Either you are paying to have it custom-built to your specifications, or you are paying to remodel an existing master suite and reconfigure the layout of the room to match your new master suite dimensions. If you are building your new master suite, you should check with your local builders association to see what the current master suite average cost per square foot is, because this will help you determine the cost of your master suite renovation.

The final category of projects that are typically evaluated in terms of cost vs. value is the kitchen and bathroom remodel. These are two of the most popular home improvement projects among homeowners, due primarily to the perceived increase in value associated with them. Remodeling a kitchen and bathroom adds value to a property because they are considered to be “upgrades” to the home. In the context of the United States, upgrading is defined as adding something new to the home to improve its functionality, rather than just making it look newer. Thus, a kitchen and bathroom remodel is one of the most common remodeling projects. While the upfront cost can seem vast, the return on investment for those upgrades is great. Like the say, kitchens sell homes, an updated kitchen can help to increase your home resale value as well as helping to sell your home at a faster pace. Additionally upgrading your old appliances to Energy star products can help to improve the efficiency of your home which can cut your Penelec power bill in half.

One final category of projects to evaluate when comparing cost vs. value is a minor kitchen remodel. This is perhaps the easiest of the different projects to evaluate, simply because there are so few factors to evaluate. For instance, there is not really any material costs associated with a minor kitchen remodel, unless you count the material costs of painting, applying vinyl flooring to the walls, and doing the cabinet work. Therefore, it really is a comparison of time and labor costs against the perceived benefit of doing the project. Again, it may be best to compare these costs against those of a full kitchen and bathroom renovation. If a remodel is fairly straightforward and easy, then the cost should not be much different from a full renovation.

 3. Cut costs where you can 

Saving money is one of the key factors to living a happy life. No matter what you are going to purchase, there will come a time when you will have to cut costs in order to save more money. It doesn’t make sense to overspend when you only get one chance to buy something that will improve your quality of life. In most cases, when the economy hits rock bottom, people suddenly have to take financial steps in order to get by. When renovating your home, this is also a reality that you must face.

Preparing for Budgets When renovating your home, it is smart to prepare first for expenses where you can cut costs. You can easily make budgets for every single expense, which can include housing, transportation, groceries, childcare, taxes and other necessities. Nowadays, you no longer need a certain target or specific savings goal to begin planning budgets, but smart financial practice to cut expenses where you can. A good place to start would be by setting up a spending money sheet where you track each and every dollar you spend on every category of daily expenses. This way, you will have a clear idea how much money you are really spending on each category and be able to pinpoint where your money is truly going.

Setting up a rainy day fund Another idea to help you manage your financial situation is to establishing a rainy day fund. It is important to set up a rainy day fund when you will experience a temporary financial setback, for example, if your car gets damaged or you have a leak. If you have a rainy day fund, instead of investing it somewhere else, you just simply withdraw it when you need it. With this, you will be able to keep your emergency fund in place and won’t have to worry about running out of cash during emergency situations.

Cutting out on non-essentials Just like the rainy day fund idea, cutting out on unnecessary expenses is also an excellent way to reduce your financial burden. With that said, it is not impossible to live well with less expenses. All you need to do is to look for things that you could do without and prioritize what you absolutely could not live without.