How Do You Plan and Budget For Home Improvements?

[PauletteGoddard]

I'm wondering how everyone plans and budgets for home improvements?

my planning starts with looking at my energy bills and my budget.

When we were DINKs, we paid for our home improvements (bringing home features in an old house up to code, energy efficiency upgrades and replacing old appliances mostly) with cash. I did use a home equity line of credit for our latest home improvement project, with a ninety-day payoff plan. It wasn't an impulse project: we'd planned it for a few years but the tax credits and rebates our state and nation currently offer made our consumer debt more bearable, and we want to time our improvements to take optimal advantage of tax credits and relax our budget somewhat. Perhaps if the timing hadn't coincided with being released from a long-term childcare financial burden I would have paid for our project in cash.

I don't know how I budget. When I peruse online information, a close estimate of cost is never available and the estimate varies by material, labor, and location. If a project is under $5000 I pay for it in cash. If I expect a payback within five years, or a 10%+ savings on energy bills, then I'll use the HELOC. If someone comments that they start planning at X months or years into the future, and sets Y% of income aside regularly, that would be helpful for me.

And for things like removing oil tanks, installing replacement windows, changing heat sources from oil to gas, or upping the voltage in a circuit, I do hire contractors.

[Staceyy]

I've heard the Habitat For Humanity Restores carry home improvement supplies for a fraction of the costs of other home improvement stores. The supplies are donated from new surpluses and old buildings. The Habitat For Humanity website lists locations across the US.

[jIM_Ohio]

I think it depends on the improvement if you finance it or pay cash, and it also depends on the financial picture of the household.

For example, if you are retired or on a fixed income, paying cash is only way I would go, unless the financing was a 0% type deal and you could pay it off before interest rates increased. Does not matter if repair or a nice to have, if income is fixed (living off investments) plan to pay cash.

If you are still working, I would divide expenses up into required or nice to have. A few roof or furnace is a requirements. Getting a pool or deck is a nice to have.

If you need to a finance a required purchase, do it, just keep payment period short (like 12-24 months).

If you need to do a nice to have, save for it, and do it in stages. For example I have a 50k project in my backyard I am saving for. Once a few bills get paid off, it will be done in phases as the budget allows. $2400 one year, $10,000 another year etc...

[littleroc02us]

My wife and I sit down twice a month with our budget ideas. If we were planning on doing something either small or large we would put aside a set amount every 2 weeks until we can pay for it in cash. It has always worked well that way and we don't owe a penny. I just did a patio this summer and saved up over $2500 and did it all with cash. No sweat when your not in debt.

[RayMetz100]

My house needs paint, there's likely a summer ant problem near the dryer vent/bathroom, and the shake roof has about 10 years left on it. I'm already 20k in debt so my home improvement budget gets $0 for now. If I was out of debt, I think I'd use some ratio of my housing costs. My home loans are $2,400 a month and utilities are $250 so I think a minimum of $100/month to a home improvement budget is reasonable. At that rate, it would take me 5 years to have $6k, which is in the order of magnatude of paint or roof. Since I'm a little behind on current maintenance, maybe $200/mo would get me caught up eventually. Hopefully I can get out of debt soon and start saving that first $200.

[stigrl]

I myself am very interested in this topic- I am trying extremely hard to be out of my credit card and one auto debt in one year. In a couple weeks we are planning on making a $1500 payment towards this.

My problem I have now is last year our back sidewalk to the back door, our main entrance, got ripped out. (We put in electrical to our detached garage and had to dig underground.) We ended up being tight on money so it didn't get replaced. So the entire sidewalk and most of the yard between our house and garage has been dirt and mud for this whole summer... which wouldn't be a huge deal except we have three dogs. I am debating using this 1400 to finally do a new sidewalk, I think my husband and father in law could do it we would just have to pay for the concrete materials. Also, while we're at it, would it be more cost effective to do a concrete patio or get some grass seed to fix the muddy area???? Part of me wants to forget the sidewalk until my goals are reached, but after almost a year of mud it is really getting to me!!!!

Opinions?

[jIM_Ohio]

Originally Posted by stigrl

I myself am very interested in this topic- I am trying extremely hard to be out of my credit card and one auto debt in one year. In a couple weeks we are planning on making a $1500 payment towards this.

My problem I have now is last year our back sidewalk to the back door, our main entrance, got ripped out. (We put in electrical to our detached garage and had to dig underground.) We ended up being tight on money so it didn't get replaced. So the entire sidewalk and most of the yard between our house and garage has been dirt and mud for this whole summer... which wouldn't be a huge deal except we have three dogs. I am debating using this 1400 to finally do a new sidewalk, I think my husband and father in law could do it we would just have to pay for the concrete materials. Also, while we're at it, would it be more cost effective to do a concrete patio or get some grass seed to fix the muddy area???? Part of me wants to forget the sidewalk until my goals are reached, but after almost a year of mud it is really getting to me!!!!

Opinions?

Depending where you live, planting grass might be better done in spring and not late summer- there is still a window where I live to plant grass before the first frost, but I know north of me time is running short.

I say be out of debt- it will be a good accomplishment, and in 2011 start getting quotes after xmas when contractors are in a slow season and might low ball bids to get work. Also look for sales on the materials you need between now and then.

[stigrl]

Thanks, yes I know it will be a good accomplisment.
And I suppose I will definelty forget about the grass seed then.... new homeowner and I know NOTHING about yard work!

[jIM_Ohio]

Originally Posted by stigrl

Thanks, yes I know it will be a good accomplisment.
And I suppose I will definelty forget about the grass seed then.... new homeowner and I know NOTHING about yard work!

Grass grows best when temperature is constant and between 65-80 degrees (read the package the grass seed comes in).

Depending on where you live, now might be the perfect time, too early or too late.

I live in Ohio and it barely gets below 90 degrees here during day, but drops to below 80 on some nights.

I was in NY last weekend and it was 80 during day and about 60 at night.

In NY perfect time to grow grass, in Ohio, I need to wait a little bit. My lawn was torn up by the county a few months ago, and I planted seed on it (because I was sick of waiting for the county to fix it) and I have some grass growing, but not enough to make a difference.

[Personal Finace Fleur]

ow, that's great. They could really be a huge help on my part.

[personalbudgetstuff]

Having a maintenance section for your budget is good. When you earn a little or extra make sure you put a small percentage into your maintenance budget for home improvements. When you know you want to make improvements put a little more aside each week into this portion of your budget. I find having a separate savings account just for this very helpful.