Congratulations on achieving the American dream of home ownership.
Now that you own a home, how do you want to improve it? When thinking about whether you want to enhance your home through remodeling, construction or repairs, be sure to include a budget for all those glamorous home improvement projects.
Thinking of using a credit card?
Before jeopardizing your financial freedom with high credit card payments and overspending, consider saving for your home makeover by putting money on aprepaid card or locking it away in a savings account until you really need it.
Follow these money saving tips to ensure you have the funds to build your dream home:
Consider the Cost
Financial experts warn that homeowners should anticipate the added costs of annual maintenance, repairs and upgrades when buying a home. It is estimated that homeowners annually spend $100 to $3,000 on routine maintenance, and $2,000 to $10,000 on enhancement projects. To afford these costs, you can use prepaid cards and put money on the REACH card to get the security of a bank account without the bank fees.
Another money saving tip for remodeling projects is to make a list of all the changes you’d like to make to the home and then prioritize that list based on what is needed vs. what is wanted. According to Remodeling magazine’s cost-to-value ratio, homeowners nationwide can expect an average of 60 percent return on their remodeling investments.
That’s why it’s important to prioritize home renovations that will not only look nice, but also improve the quality of your home – for example, adding new granite kitchen countertops.
Make a Plan
After prioritizing your list, the next step in beautifying your home is to create a budget. Develop a plan that will allow you to save what you can and spend where you need it most. Setting aside money and putting it on a card like the REACH card will allow you to use funds you’ve already budgeted, reducing the chance that you’ll overspend. Smart money management is key to affording all of your glamorous home improvement projects.
Save, Save, Save
It’s recommended that homeowners save about one percent of their home’s purchase price per year. It’s best to start saving from day one so that you’ll have money when an emergency arises. Use prepaid cards to save money for all your home improvements with the freedom to spend without accumulating credit card debt or maintaining a bank account- they make it easy to save by allowing you to make direct deposits from paychecks, government checks and even tax refunds right to the card.
If you’re using the REACH card, you can transfer money from one card to another- making it easy to build a home improvement savings fund.
Now that you own a home, make sure you have the funds to make it a dream home.
Realize your goals, set priorities and start saving to improve your house- now and in the future.