Saturday, June 30, 2012

The Importance of a Budget in a Remodeling Project


If you own a home for any length of time, chances are you have thought about a residential remodeling project. You probably loved your house when you first bought it, but over time, the features or design probably became a little outdated. If your family has grown, you may have even considered residential additions in order to give you more space and functionality in your home. Dreaming of a remodeling project is always fun because the sky is the limit. You can think about doing wonderful things without having to pay any attention to the prices. However, if you actually start thinking about completing the remodeling project, the cost of everything becomes an issue.

Some people prefer to start with a basic remodeling plan and then start adding or making upgrades as they discover that there is more room in the budget. Other people prefer to start with a plan that includes everything they want and then start finding items that can be downgraded or removed until they reach the budget amount. Regardless of which approach you take, it is critical that you set a firm budget for the project. If you just have a general idea of how much money you can spend, it almost guaranteed that you will end up over budget. Another mistake that many people make is to plan to spend their entire budget. 

Everyone has heard horror stories of remodeling projects that have not gone well. Chances are that something along the way will go over budget. Something will cost more than anticipated, something will break and need to be replaced, or any number of other things could happen that will end up costing more money. If you do not include unexpected expenses in your budget, you could run into real problems before it is completed. You may have to come up with the extra money in order to finish the project or you may even have to live with the project only being partially completed until you can earn the extra money.

The best way to keep your costs in check when you are setting a budget is to determine the difference between “must have”, “would like to have” and “only if there is money leftover”. If you are remodeling a kitchen, you have to have cabinets of some kind. You then have to decide if you want to pay for replacing the cabinets, for replacing only the doors or just painting the cabinets.

Fixtures are another area that you can save money in your budget. When picking out your fixtures, compare the look of the more expensive ones with the less expensive ones. You might be surprised at the lack of difference between them. Then you have to decide if the difference is worth paying for. Some people may opt for fixtures that look a little better and cost more money, but other people will prefer fixtures that are “good enough” so they can spend the extra money somewhere else.

In order to have a successful project, make sure you are always aware of where you are at with your budget.