Home improvement projects can be costly. But there are ways to save money while renovating your home.
Start by setting a savings goal. It helps to have a separate account dedicated to home improvement so that you don’t dip into your emergency fund or credit cards.
Remember that major renovations can cost up to 10% to 15% of your home’s value. Compare quotes from contractors to get a general idea of costs before you begin your project.
1. Save Time
Regarding home improvement projects, costs and time can quickly add up. But with careful planning, you can save money and finish your projects on time. Take advantage of coupons and sales from home improvement retailers such as Home Depot, and consider doing some of the work yourself. These small steps can make a big difference in the overall cost of your project.
Before starting any renovations, create a budget and rank your priorities. Ask contractors for quotes and compare costs. Also, consider what you can do to save money, like painting or refinishing wood floors instead of installing new ones.
But try to do something other than DIY a project that requires a licensed contractor, or you could be putting yourself at risk of injury, property damage, and costly insurance claims.
Some homeowners set up savings accounts dedicated to home repairs and upgrades, adding a portion of each paycheck to the account. This can help you avoid the temptation to spend more than you have and will make it easier to track your progress.
In addition, if you have good credit, you may qualify for a low-interest loan or HELOC secured by your home’s equity. This can save you a lot in interest payments.
2. Save Money
Home improvement projects can be expensive, but there are ways to save money on them. One way is to plan and save for the project, whether it’s a new kitchen or backyard patio. Another way is to use coupons and sales.
When planning a home improvement project, the most important step is to create and stick to a budget. Start by making a list of the changes you want to make and rank them in order of priority. Then, research costs online or ask neighbors who have recently had similar work done what they paid. Once you have a rough estimate, add 10% for cost overruns.
If you need more time to be ready to commit your savings strategy, consider adding a small amount to your monthly spending plan or using any financial windfalls (tax refunds, gifts) toward the project.
Also, choose lower-cost options, like refinishing cabinets or painting walls instead of installing new ones. In addition, make sure to factor in the permit cost for any structural changes or plumbing, electrical, or mechanical work.
3. Save Energy
A big chunk of the typical household budget goes toward recurring homeownership expenses such as mortgage principal and interest, property taxes, homeowners insurance, and utilities. But, several home improvement projects can reduce these recurring costs while adding value to your house.
These money-saving projects aren’t flashy, and most people don’t invite friends to see their new ENERGY STAR light bulbs, but they still need to make a difference! One ENERGY STAR bulb can last 15 times longer than an incandescent bulb and uses up to 90% less energy.
For these energy-efficient projects, you can also use state and federal tax credits to help defray the upfront cost. You can also save up for these projects by committing any financial windfalls, such as tax refunds or monetary gifts, to your home improvement savings plan.
This will give you a solid head start on your project. You can also increase your savings by cutting utility bills and holding a garage sale, with the proceeds going into your home improvement fund.
4. Save the Environment
Whether you want to repaint your house or spruce up your bathroom, a home renovation project can make you fall in love with your living space again and increase the value of your property if you decide to sell. However, it’s crucial to consider ROI when developing your budget and prioritize projects that will deliver the most bang for your buck.
This is especially true when it comes to energy-efficient upgrades that reduce your home’s utility costs and appeal to cost-conscious homebuyers. For example, replacing your existing incandescent light bulbs with ENERGY STAR-certified LEDs can cut your electricity bills by up to 90% and save around $225 annually.
5. Save Your Health
Home Improvement projects can be a great way to enhance the value of your home. But, not all projects are created equal. New kitchens, bathrooms, and windows can dramatically increase your home’s resale value but can also cost thousands of dollars and take weeks to complete.
Fortunately, many DIY (do-it-yourself) projects can be completed for free or at very little cost. Some of these include decluttering to create more space, organizing your life to run more smoothly, and beautifying to add style. Adding spray paint to light switch covers, outlet covers, or cabinet pulls is an easy and inexpensive way to refresh your home’s look.
So whether you’re thinking about listing your home or want to enjoy it more, consider these do-it-yourself projects that don’t require the help of a professional contractor.