Funding Your Home Renovations: Budgeting and Supplementary Income
We’re always looking to stretch our dollar and make more out of what we already have, but even the strictest of budgeters sometimes find that saving tactics don’t always do the trick. That’s why supplemental income is so important for many American families. It’s always nice to have a few extra dollars trickling in, especially for those families looking to make improvements to their home, whether it’s a massive renovation overhaul or just some new decorations.
I recently purchased a rental property to lease out; not only has home renovation and décor become my new favorite hobby, but I’m also creating a lucrative supplementary income for improvements on my actual home. That said, with my new mortgage, I need some extra income to help fund my creative aspirations before the rental income becomes profitable.
When it comes to organizing my income, I’ve made the efforts to avoid spending it all ‘willy nilly’. Through detailed budgeting, I’ve found ways to fund personal projects, put money towards saving, and work towards making my décor dreams a real possibility.
Budgeting Tips for Renovations
Make the most of the money you already have by following a strict budget, and put different strategies in place to ensure your wallet can handle the renovations you have in mind. Here are some of my favorite tips:
Income vs. Outcome
Know your income and plan for your ‘outcome’. Gather all the information you can about your income and where your money goes each month—credit card statements are a good start and old receipts will help, but having a handle on these facets is one of the most important steps to planning a future budget. Track your spending for a week or month to get a good baseline and stay committed to your budgeting inventory.
Alternatively, there are a few budgeting applications that work very well. I have used Mint.com in the past and enjoy it for tracking my spending. However, when preparing for a project, the next tip is key!
Excel is Your Friend
When preparing for any large expense, use Excel tables to help you in your budgeting aims. Put your income and any known monthly expenses into a table. Make sure to include the budget of the project you are preparing for!
Pro Tip: Press “CTRL T” to put necessary data into a table so you can organize by the different columns. Microsoft Excel also has great tutorial resources and templates for its users.
Take Advantage of Itemizing
Itemize each piece of your décor or renovation project on your budget document. Go to Home Depot or Lowes and in the same way you would register for your wedding (ah that was fun!), take down the price of each item and put it into Excel. Even better, on your new table, add a link to the item on their website.
Pro Tip: If you see an item that you need for your project go on sale, get it and keep it in your garage or storage. During the budgeting stage of my last garden project, I was able to save around a hundred dollars this way.
Cash on Hand
Keep cash for a project in a special box or folder. I like to have a little business folder for personal expenses, my upcoming projects, and my other monthly expenses. Trust me, you’re much less likely to spend money if you are physically dipping your hand into an envelope. The guilt is real, much more so when your money is a tangible thing. Cash isn’t your thing? Open up a separate checking account for your project and transfer 5% of your disposable income each month into this account. When it hits your preselected number, boom—it’s decoration time!
Money Earning Tips
Now that your budget is set up, focus on ways you can keep the money flowing in. Here are some easy tips that I have implemented to keep a few bucks trickling down the pipeline:
Sell Old Household Items
Look at the room or portion of the home you plan on renovating, and take inventory of the items you have. If you plan on buying new lamps, mirrors, tables, etc., for your new décor project, take photos of your old belongings and sell them online. Put a great ad on Craigslist that will attract a large number of buyers and repost it every other day until the item sells. Use clear, concise headlines that will attract potential buyers, and keep them on your ad with high-quality photos and easy-to-read descriptions that upsell your items.
Pro Tip: Good headline- “Vintage Lamp at Insanely Low Cost”. Bad headline- “Old Lamp in Okay Condition.”
A Profitable Turnaround
Go to garage sales, buy items and turn around to sell them on Craigslist—there’s a definite market for this type of transaction. I recently made $75 selling an old desk I bought at a garage sale. Sometimes you even find things for your house that will fit in your new project!
Rent Your Space
Make some easy money by renting out your entire home when on vacation or an extra room while you’re still there; Airbnb and Home Away are great options. Make sure to stay safe and vet your tenants. Airbnb has an insurance policy, but I always like to use TransUnion SmartMove to get information about my renters that they might leave out. There are other services out there as well, but it is important to make sure you are renting to trustworthy people or you might find yourself in a tough and costly situation.
Pro tip: If you put your entire home on a rental site for the weekends, you can have your guests move in and you can enjoy a staycation or weekend getaway with your rental money and still have some left over! Keep an eye out for conventions and special events in your city and increase the price during those dates.
Are you a writer extraordinaire or savvy at social media? Head over to local ‘mom and pop’ shops and offer to write articles for their websites. This is an ingenious idea for stay at home moms or dads like me. Shops love the extra help and often will pay (albeit not much) for your service. Is writing not your thing? Try marketing studies. There are several organizations that will do marketing studies and pay you for your time. I recently did one and I got some free soda, a lunch, and $80!
If you’re an animal lover like me, consider pet sitting or dog walking. There are services out there that pay you to walk neighborhood dogs; Sitter City, Rover, Craigslist, and the list goes on. A simple Google search will help you find an applicable service in your neighborhood.
Pro Tip: Read up on dog walking tips and etiquette before reaching out to someone. There are several great resources on the web to help you in this area. Whenever you are reaching out to someone for freelance work, you always should sound like a pro (even if you are not).
When it comes to home décor and renovation projects, budgeting and supplementary income can be essential. Ask professionals, buy good quality, and follow your artistic passions.