Among the most unsightly areas of your house, kitchens and bathrooms can be the most difficult to renovate. But with a little creativity and the right paint and doorknobs, you can easily update the look of any room in your house. Other home improvement projects you can perform include installing new flooring, carpet, or curtains. In these projects, you’ll find that a little money will go a long way. Read on to find out how you can budget for your home improvement project.
Budgeting for a home improvement project
A home improvement project can seem overwhelming if you don’t know how to budget. You have to balance cost with quality and personal preference. You may have to settle for a less expensive brand or choose a less popular style. The most important aspect is to stick to your budget. If you’re running short on funds, consider keeping a few backup options on the backburner. A good home improvement contractor can help you find a way to fund the project within your budget.
Cost vs. value
A recent report from Zonda outlines the cost vs. value of various home improvement projects in the U.S. In its 35th year, the Cost vs. Value Report analyzed 22 major home improvement projects and found that exterior improvements continue to deliver the highest ROI. The biggest drop in ROI came for Fiberglass grand entrances. This type of project decreased from 71.9% ROI in 2019 to 59.7% in 2022, a 12.2 percent decrease.
Choosing a contractor
Before hiring a contractor for your home improvement project, you should review their work history and references. The Better Business Bureau can give you valuable information about the work ethic and complaints of previous clients. Accredited companies adhere to BBB standards, which include building trust, being transparent and responsive to customers. Additionally, they must protect their clients’ privacy. If possible, call references to ask about the contractor’s work ethic and professionalism.
Getting a loan
There are various types of home improvement loans, but the right one for you depends on your specific situation. If you already have a lot of equity in your home, you might prefer to use a home equity loan or a cash-out refinance to reduce the interest rate and shorten the loan term. If you do not have enough equity in your home, you may opt for a personal loan or use your credit cards to finance the project.
Getting a credit card for a home improvement project
If you have an upcoming home improvement project, a credit card can help you finance the expenses. However, you must make timely payments, otherwise you may damage your credit rating and accumulate high-interest debt. Additionally, you should avoid letting your balance grow because you risk negating the value of your home improvement project. Experian’s Rod Griffin, senior director of consumer education, suggests that you use a credit card for home improvements, but avoid letting it go to the point of putting your emergency fund and savings into debt.