There’s something about summer that gives me crazy motivation to get things done around the house. Maybe it’s the longer days or maybe it’s just me looking at my neglected backyard and comparing it to all that amazing landscaping I keep seeing on HGTV, but I really want to take on some home improvement projects this summer. If you’re also looking to upgrade your space, here are four questions to help you plan out your home improvement projects and keep them manageable and affordable.
What’s Your Plan?
As many of us have learned the hard way, home projects can easily get out of hand. I’m talking out of hand in the sense of being too big in scope, taking much longer than planned and exceeding our budgets. Before you take on any home improvement projects — even seemingly minor ones — formulate a plan. What are your expectations for your project? Have a clear idea of what you want to accomplish and break things down as much as possible before you speak with a home improvement professional or head to the store to start purchasing equipment. Starting on improvements without a specific idea as to what you want to change in your home or yard can turn into a never-ending project because there are endless ways you can keep improving any space. Pick a set goal, and see it through to completion.
What’s Your Budget? Home renovations tend to be expensive, and the costs add up quickly. Keep everything manageable by developing your budget ahead of time. If you have saved up money, determine how much you’re comfortable spending from your savings. If you’ll be getting a loan to finance your project, figure out how much debt you can handle before you take it on. There are free online tools to help you calculate your monthly payments based on different loan amounts, terms and interest rates. Because home projects can come with unexpected expenses, it’s a good idea to tack on an additional 10 percent to your initial cost estimates — just in case. Including that additional 10 percent for wiggle room, establish the absolute maximum you can afford for your project, and be careful not to exceed it. Who Will Do the Work? Maybe you’ll be doing some or all of the work yourself, or maybe you’re as accident-prone as I am and will be hiring professionals to handle absolutely everything. Regardless, it’s important to have people you trust helping out. The end results of your home improvements and your stress level throughout the projects will depend largely on who’s handling the work, so don’t rush through this process. If you’ll be hiring others, be sure to ask around for referrals from your friends, family or coworkers. Seek out quotes from at least three places to be sure you wind up paying a fair price, and get everything in writing. If the quotes you receive don’t fit within the budget you’ve established, don’t lose hope. See where you can scale back or delay some aspects of your project until a later date and ask about deals that might be available such as discounted surplus materials. How Will You Pay for Everything? Ideally, you’d have enough money set aside to pay for your home projects with cash, but this is not always an option. There are many ways to finance home improvements — everything from home equity loans to credit cards to personal loans. Talk to your financial institution to see what options are available for you, and check around to be sure you’re getting the best rate and terms. Keep in mind that loans secured by equity, like houses or vehicles, will typically offer lower interest rates than unsecured loans. When you look at interest rates, don’t forget to also consider the other numbers like closing costs, application fees, etc. One lender might have a lower interest rate than another but charge a high application fee or assess prepayment penalties if you ever want to make additional payments on your loan. Be sure to look at all the numbers and research a variety of loan terms and options to find the financing that works best for you.
April Clobes is Executive Vice President/Chief Operating Officer for MSU Federal Credit Union in East Lansing. She can be contacted by e-mail or by calling (517) 333-2254.