Remodeling- how much to save?


Hi, we’ve been planning on doing some remodeling on our house and we have some money saved, but I’m not sure how much to save. I’ve never remodeled a house before so I don’t know how most people handle the money aspect: do you save up everything in cash before starting? Or do you get a loan like a homeloan where you put 20% down? I’m not sure if we need to wait a few more years or if it’s something we can go ahead and start getting an architect for now. How do people do remodels?


Depends what you are doing. Major work or just cosmetic? I’m of the camp that you should pay in full unless it’s a major necessary thing.

Do as much of the work you can. For things you can’t do, get several quotes, and ask for discounts if you do some or all the demo. Demo is often more expensive than the install, so that’s a good way to save money.

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It’d be pretty large- expanding out the back of the house to add a 3rd bedroom so it would involve pouring foundation and a whole new skeleton and roof. It’s not “necessary” because it’s just an extra bedroom so our 3 kids (11, 9, 6) aren’t sharing a tiny room together, but it’d be nice- our house is <1000 sqft right now. I think we’d need an architect and then the contractor and all the labor and I’ve never done anything like this so I don’t know what to expect at all.


We’re in the middle of a major remodel. We’re paying a bunch out of our savings but also both took out 401k loans (maximum $50K/pp to be paid back over 9 years from paycheck or immediately if you leave the job). The nice thing about 401k loans is that you pay the interest back to yourself!

Depending on how much equity you have in your house, you can also get a HELOC (home equity line of credit). It’s a variable rate loan taken out against your house. Just note that you have to close the HELOC if you ever want to refinance, and since the interest rate is variable, it could go up.


We borrowed against a 401k to buy the house. :slight_smile: And we also needed a HELOC to buy it because we did not have a large enough downpayment and just paid off that HELOC with our tax refund because we wanted to stop the variable rate from going up. It feels a little silly to get a new HELOC, but I guess we’d be at a lower rate than we were paying, for at least a little while.


It sounds like you should save more money before considering a “nice to have” renovation :slight_smile:.


I haven’t done a remodel, but I would also vote for waiting and saving up some more cash first. You might end up needing money for an unexpected repair or other emergency.


We had cash saved up. Our reno was put off for many years because we spent money on other stuff first - IVF, new-to-us cars to replace our beaters once we had a newborn to deal with, new roof after a hole developed in one section… The kitchen was not great but it was functional so it was not high priority.

I also got in touch with a realtor (my friend raved about the person she had) for some back of the envelope numbers to be sure we didn’t outspend our neighborhood and it was really useful. The realtor flat out told me there was no way we’d get above $XXXk for our house when we sold, since we had already bought it for [amount] and done a new roof and air conditioning system, that meant we could only spent $YY on redoing our kitchen. She also advised against bamboo floors because they cost more and no one cares that your wood floors are bamboo when you’re selling, and granite counters are nice but not going to make a ginormous difference when selling (better than shitty, chipped white laminate, though, which is what we had).

When we were shopping around for quotes, I said our budget was 80% of $YY because I expected to go over budget, and sure enough when the job was done months later we did come in right at about $YY. We had a few different plans drawn up for the kitchen design but there’s only so much you can improve that space with that budget since there’s several doors that come into that space. We did the painting, we originally planned to DIY the flooring installation but I’m so, so glad we hired it out because they did it in two days and we were able to get back to living normally much, much quicker. We were also able to add in some minor chores since we had plumbers and electricians on site already - moving a ceiling fan, adding an outlet in the hallway, replacing a bathroom faucet, clearing the shower drains, etc.


No idea about renos, but I grew up with 2 sisters, in ~1000 sf apartment (no garage storage!) the 3 of us sharing a room until I was 15 or 16. Our parents gave us the larger room, although their bedroom was also dad’s home office (he only wfh occasionally). We had our own storage space, whether it was a cabinet or a desk, starting in late elementary school. For a while, my desk was in the living room, and at another point our whole bedroom got moved there while my grandparents visited. (My youngest sis moved in with mom and dad, IIRC.)

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We’re hoping to do a major remodel in a few years, and we’re saving up as much as we can for it. I’m not sure about financing options you have available, but it sounds like having a chat to a realtor and an architect/builder while saving money could be a way to feel like you’re getting things moving without spending money you don’t have yet?

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