Does owning the home of your dreams sound like a far-fetched idea? Well, it can definitely be a dream that never comes to reality without proper financial planning and execution. There are things like moving up to a higher paying job and increasing your credit health, that can all be contributing factors that will get you closer to holding the keys to your dream home. In order to make that dream a reality, often a budget friendly saving approach is not enough.
One of those things you have to consider is to endure sacrifice. People make sacrifices all the time to get and do the things they want. Dave Ramsey talks about how people make sacrifices to get out of debt by renting instead of owning their own home. That tactic typically does work for people to get into the home market, but it also works for getting your dream home too.
After sacrificing on things like space, square footage, and amenities, you may be able to see that you are able to make payments to clear your debts and are on the road to savings. So, what does that mean? That means that you’re finally able to work towards buying your first home! Congratulations!
So, now you’ve gone house shopping and found the home of your dreams, but it needs a little bit of work. You love the square footage and space it gives you and your family but there are definitely some fixtures and appliances that need upgrading, walls that need a fresh coat of new paint, and carpet that needs to be replaced with wood floors.
As you can imagine, all of those upgrades come at no easy cost. Homeadvisor.com gives an estimate of the cost of installing wood floors. It can range anywhere from $1000-$10,000! And that’s just an estimate for floors. You have to take into consideration the cost per square foot, the type of wood flooring you want, labor, and layout of the room.
That makes you not even want to think about the cost of painting, appliances, and other renovations but the good thing is that you don’t necessarily have to come up with the money for all these upgrades at once. You can do them as it fits into your budget. We’re going to take a look at ways to fund your home renovations to turn your new home into your dream home.
How do you raise the extra cash you need to renovate? How about considering some creative funding options. Maybe you’re pretty good at car repairs or tutoring. Maybe it’s time you start cashing in on your talents by starting a side business in your area of talent. There’s nothing better than working for yourself, especially if all the advertising and promotion can be done online. The key here would be to stay consistent. You can’t just work raising funds for a little bit one day and then not start back working on it until a week later. If your serious about this home renovation project, then you’re going to need to get serious about additional income and that goes for whether you’re needing a downpayment on a home or to financially back a home reno project. This would be another time in your life where you’d be reverting back to your good friend called “sacrifice,” except this time, your sacrifice would be time.
Start Saving With Aggression
People use the term “aggression” in reference to paying off debts. They’ll say that they’re aggressively paying off their debt, meaning that they are making every effort/any extra money they get to pay off their debt. You can have that same approach with your renovation costs. Any extra money you get, throw it in that high-interest savings account! Guess what type of sacrifice this will be… a money sacrifice!
For some people, saving money to put towards your home renovations is not going to be an easy task. If you can, try looking for high-interest savings accounts so that when you start depositing money into that account. These high-interest saving accounts are definitely a great resource to save your home renovation money but there are so many other options out there too. Another option would be to look into trust funds and company bonds that have great interest rates!
Consider a Savings Calculator
By using a savings calculator you’ll be able to get a good estimate of how long it could take for you to save for your home renovations and get an idea of how realistic your financial goal is? That can be really helpful for you to see what you need to save financially and what time frame you need to do it in.
Make Necessary Cutbacks
Look at any and all areas of your financial situation to see where you can save money from month to month by making cutbacks in your current lifestyle. Remember, the bigger the cutback you make, the closer you’ll be to achieving your renovation project goals. Take a look at some areas that will help put more money towards your oh-so desired home renovations.
- Getting rid of cable
- Skip eating out and cook more
- Consider a Carpool
- Cancel memberships (especially if you’re not using them)
- Keep your thermostat temp on the higher end in the summer and lower in the winter
- Stay at home more (we seem to spend money more when we are out)
Now, cutting back on your expenditures is not the most terrible thing in the world, especially if it’s just temporary until you have the finances you need to move forward… can you guess what sacrifice is being made here? It’s a lifestyle sacrifice.
Sell Your “Stuff”
For most people, it’s not until they start packing to move into a new home that they realize just how much “stuff” they’ve accumulated over the years. So rather than just carry it all forward to your new place, it might be time for you to have a good old-fashioned yard sale. The key thing to remember with yard sales is that you’re not going to get nearly as much money for these things as you did when you first bought them so go into it knowing that every dollar. You earn, is new money to you. A little bit of extra money is way better than no money at all, right?