With spring just around the corner, we’re all craving a much-needed reset. What better way than to clean up around the house and maybe even plan for a remodel project? If you’re considering sprucing up one or multiple rooms in your home, one of the first steps will be to plan out a budget. Yes, we know. It might not be the most enthralling part of the process but it is a vital one as you want to have an inclination of the costs associated with remodels. Having a budget from the get-go will give you the freedom to invest your full energy into your remodel rather than juggling the financial aspect at the same time.
Plan Out Your Dream Remodel
Before crunching any numbers, plot out a rough idea of what you want your home remodel to look like. Write down which rooms you want to spruce up and what exactly your goals for this project will be. Do you simply want to switch up the color scheme? Or do you have a more involved, structural redecoration project in mind? Let your imagination take the wheel here as you plan out your dream remodel. Just keep in mind that this is only a rough draft. Whether everything on your wishlist is doable or not will depend on your available budget and skillset.
Ask yourself these questions as you plan out your room remodel:
- What feel do I want this room to have?
- What colors do I want to highlight? Patterns?
- What is my timeline for this project?
- What materials will I need?
- Will I complete this project by myself?
- What furniture and decor will I keep?
- What new furniture and decor do I need?
Pick Out Decor and Furniture Elements
Furniture and decor breathe life into a space. But overhauling an entire room’s worth of furniture and decor can get a bit pricey. Take a look at the room or rooms you’re redecorating. Are there pieces you want to keep and build around? Or do you want to start completely from scratch? Start to pick out potential decorative elements and furniture. Remember, this is only to get an idea of how much your design project might run you, not a definitive list of items you need. Keep an open, realistic mind while fleshing out this list.
Here’s what to include on your list:
- A rough idea of what you’d like to spend.
- The furniture you definitely want to keep.
- Furniture you want to buy.
- Decor you want to buy.
- Additional renovation ideas.
- The cost of each piece.
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Evaluate Your Current Financial Situation
Now that you have a wishlist plotted out, you can get down to the nitty-gritty. Can you afford the room remodel that you have in mind? A single room can cost anywhere from $3,000 to $100,000 depending upon the renovations you have in store. Compare the projected cost of furniture, decor, and other renovation aspirations to what you can currently spend. Does it align perfectly? Fantastic! Is there a gap in how much money you have to spare versus the remodel cost you drafted out? Then it’s time to pivot.
Your first option is to adjust to your current financial situation. Trim down your wishlist. Do you really need that brand new designer couch? Can you part with the custom wall art you picked out? At this point in the process, evaluate what your “must-haves” truly are and distinguish whether or not you’re willing to adjust your wishlist.
If you sit down with your remodel plans and can’t bear to part with anything on your list, it might be time to explore other monetary options. If you’re willing to wait on your remodel project, you can go the budget and save route. If you still want to get your project off the ground promptly, you can look into loans and other credit options.
Create a Budget and Save
Willing to play the long game? Then you should prepare to budget and save for your dream room remodel. A budget will require looking at your after-tax income, financial obligations, overall spending, and leftover money. Usually, people will break this down as a month-long overview but you can work with whatever timeframe makes the most sense for your situation. The goal of budgeting is to get an idea of how much money you can spare to put towards savings and paying off debt. In your case, we’ll discuss putting away cash for your home remodel.
There are several ways to manage a budget. If you’re a fan of the classics, you can write all of your bills and spending breakdowns in a planner. Nowadays, there are apps you can use that can sync to your bank account. If you want additional support, you can even work with a financial advisor.
If you’re wondering how much money you should be saving, you can go by the 50/30/20 rule. It’s a great way to break down where you should be spending your income.
- 50% towards bills and necessities
- 30% towards wants
- 20% towards savings or debt
Of course, this is not a hard and fast breakdown. You can adjust these percentages accordingly. Once you get a framework established, you can slowly work towards saving up money for your room remodel. If you need an additional stream of income, you can start a side-hustle. Some popular options are starting an Etsy shop or creating your own freelancing business. You can also start to sell off the furniture you’re hoping to replace. Soon enough you’ll be well on your way to starting your room remodel!
Explore Loan and Credit Options
If you’re in a situation where you don’t have all the direct funds to finance your project but you still want to move forward with it, you can think about borrowing the cash you need. There are several types of loans and credit options available to explore.
- Personal loan - You can acquire a personal loan through your bank or a separate financial institution. Lenders will typically offer up to $100,000 with rates between roughly 6% and 36% for home improvement. This is a quick way to gain the funds you need but keep in mind that your credit will take a hit if you miss your monthly payments.
- Equity Line of Credit or Equity Loan - If you have been in your home for a long time you likely have equity in it. You can leverage this equity to get a line of credit or loan. The credit line can be used as a credit card and the loan is a lump sum. These interest rates are typically quite competitive but keep in mind your home will be collateral so be sure you can make your payments.
- Credit Card - While not the best option, you can lean on credit cards for smaller projects. This option is best suited for those that can quickly pay their bill off as credit card APRs can be pretty steep. One perk to credit cards is that you might be able to earn rewards so try to find a card that can benefit you with hotel stays, miles, cashback, or something similar.
Happy Remodeling!
We hope this was a helpful guide to budgeting for a room remodel. There are plenty of ways to get creative with your money when planning a design project. It’s just a matter of clever saving, savvy credit usage, and wise spending. Once you do finalize your budget and proceed with your remodel, come back to visit Loth & Co for all your home decor needs. Our selection is tailored towards the stylish homeowner with refined tastes. We would be honored to earn a spot in your home!