Are you thinking about making some changes that would make your home easier to sell? Or perhaps you’re simply ready to take the plunge and turn your current house into the home of your dreams. You may be ready, but is your budget? Here are some tips on how to save for home improvements.
Tip 1: Start putting away money every week in a separate savings account. You might want to even put it in automatically with a direct deposit from your check. Having a designated savings or checking account set aside for home improvements keeps those funds separate from other home-related expenses. Having a dedicated account can help you keep better track of your savings goals and progress, and will help eliminate the temptation to dip into your savings for other expenses. “If I don’t need it, then don’t buy it.” Let this short and simple phrase serve as a friendly reminder for you to think twice about what you truly need and when you need it versus what you want at that moment.
Tip 2: Ask other homeowners in your area about their budgets for similar projects. If the cost seems doable, contact a contractor (or three!) to get an estimate of what the total cost for your home improvement project will be. At Thomas Custom Builders, Our Process includes meeting you at your home to discuss any constraints related to your vision and existing home conditions. We factor in your budget and level of finishes and determine a realistic financial investment range, including a little extra for any surprises that may occur.
Tip 3: Frame a savings strategy. You can go about this in different ways, depending on your income, other expenses, and home improvement goals. One way would be to set aside a certain percentage of your home’s value each year toward home improvement projects — ie: set aside 5% of the assessed value of your home and land each year and divide that into a monthly savings amount. Another option would be to estimate the total cost of the home improvement project that you wish to pursue, then divide that total into monthly installments that your budget can handle, stretched out over one year, two years, or more. To give your savings a boost, consider committing any financial windfalls, such as tax refunds or monetary gifts, to your home improvement account.
Tip 4: Look for creative ways to save money that you can earmark for your home improvement savings plan. Reduce your monthly utility bills by implementing some energy efficiency techniques throughout your home. These small changes can yield large impacts over time as it relates to your water, electricity, gas and more. For example, make an effort to use less water by limiting the amount of time you and your family spend in the shower. When brushing your teeth, only run the water when it’s time to rinse. You can also heck with your telephone, cable and internet service providers to see if there are lower-cost plans you can switch to and deposit the difference in your home improvement account. Eat out less. Cook more. Make small adjustments, like prepping and cooking meals for the week.
Tip 5: Consider adding a home warranty to help protect your budget from unexpected home breakdowns while you’re trying to save money for home improvements. Home system and appliance malfunctions can be real budget busters, and they always seem to happen at the worst possible times. Instead of dipping into your home improvement fund for unplanned breakdowns, a home warranty can offer protection for the repair or replacement of covered items.
The bigger your goal, the more time you’ll need to save for it. Minimize unnecessary spending and maximize your savings to reach your goal sooner. Your home is probably the biggest investment you’ve got, and you owe it to yourself to make improvements that will increase its value as well as your enjoyment.