Skip to content

Why Your Home Remodel Budget Will Incresae By 200%

Home Remodel Budget Example


I haven’t been blogging as much lately because life has been chaotic. But, from the chaos, I want to share the lessons I have learned from one of the most significant projects I have undertaken: acting as a general contractor for my home remodel. So, without further ado, here are my lessons from a major renovation and how to ensure the costs don’t blindside you by creating an accurate remodel budget (plus a spreadsheet for calculating your budget).

Crafting your expectations 

When I purchased my residence years ago, it was at the top of what I could afford and needed renovations. However, it was the best option and the lowest-priced home in the area I wanted to live.

After settling in, I put off remodeling for quite some time as saving for Financial Independence eclipsed all other goals in my life. Once that phase of my life sunsetted, I found myself ready to remodel, and my partner and I began determining the project’s physical and fiscal scope. 

Looking back now, I can see that our hopes of crafting an accurate expenditure outlay were comical since I had no experience in construction. 

We chose not to hire a general contractor, and through the permitting process, I “became one” to manage our various tradespeople to save money. But, I failed to establish an objective baseline cost and instead came up with only a rough inkling of the project’s estimated cost, which was flat-out wrong. 

Therefore, my first suggestion when planning a remodel is to get quotes from at least three full-service general contractors. While you may need help locating available general contractors in your area depending on your location (Colorado, I am looking at you), it is a worthwhile exercise, even if you plan to oversee the work or do it yourself.

Construction management is a trade that requires skill and experience, and if you have none, you should enlist the help of experts to set your expectations appropriately. 

As an aside, do not feel bad if you don’t want to do the work yourself, as paying others for their skillset is acceptable and not a financial sin, contrary to the FIRE-side campsite talk (assuming you have the money). 

Everyone has their specialty, so make the tradeoff with the most palatable opportunity cost for your situation. 

Expect the unexpected and budget accordingly

When we undertook our project, we knew there was a chance we would discover asbestos in the walls or ceiling. For those unfamiliar, asbestos is an inert mineral that was used in construction materials to help add fireproofing that becomes dangerous when aerosolized and inhaled. 

We tested our home for asbestos to ensure that we didn’t expose ourselves or various tradespeople to a potentially cancer-causing compound during the demolition phase. As fate would have it, every wall and ceiling contained this mineral in the drywall texture and required proper abatement.

While we had planned for the cost of abatement, gutting down to the studs (i.e., raw structural framing) increases construction costs since more materials and labor are required to replace them down the line. 

If you have yet to build a home from scratch, it is difficult to foresee all the expenditures that need forecasting. Consequently, when planning out your project, be prepared to have a best-case budget for if things go without a hiccup and one that factors in the auxiliary costs of every issue arising that is forecastable.

If you do not have adequate cash reserves to cover a project doubling in cost, you may have to make difficult decisions to prioritize what matters. Notably, you cannot anticipate every scenario and must expect snares, even when utilizing a general contractor.

Hence, only rip open walls or tear out lights and fixtures once you must. And expect the unexpected!


During the remodeling process, I had various tradespeople ask me if I wanted additional work done that I had not considered. Some of this work I declined, but some I accepted as I had failed to anticipate it. While this adds up, it is less substantial than the scope creeps from wants and needs that come up mid-renovation.

Before embarking on your project, plan for scope creep by allocating additional funds to your budget or sticking to your original plan. Saying no when you are remodeling your home is hard, especially when you are seeing your vision come true.

Still, declining desires as they arise is a trait that will help you from going over budget since materials and labor add up fast in construction.

Non-monetary considerations

While the primary focus of this post is to discuss the monetary component of remodeling, I would be remiss to exclude the human elements that come with remodeling, including stress and time commitment. 

Remodeling is stressful, regardless of whether you have a general contractor. While I undertook the role of a general contractor, we had good friends who remodeled in concurrence but with the aid of one. Both remodels induced stress from the various things that can and do go wrong. 

Delays can cause undue anxiety, and the amount of time spent overseeing a project can encapsulate your weekends and spare hours. Be sure to try and separate yourself from the project when you do not need to manage details. I far too often got lost worrying over mundane details that received unnecessary and prolonged attention.

While delays will inevitably occur with most construction projects, such as with the permitting office and lost materials in our case, you should plan to dedicate a substantial chunk of time towards remodeling. Working with tradespeople or general contractors from afar is exceedingly tricky, and you need to plan to be active and present. It will help if you plan your calendar accordingly to prevent headaches down the road. I spent most of my free time during the summer and remained within our local area to ensure things went properly.

Suggestions for your wellbeing

One of our decisions early on was to hire a designer for the remodel. While some in the finance community may shun the idea, a good designer eliminates decision paralysis and saves you time at the expense of money. For us, hiring a professional was well worth the time savings. Therefore, consider using one, especially if you are already tight on time or prone to arguing over minute details.

The next suggestion for those ready to embark on remodeling is to permit your project with your city if it involves plumbing, electrical, or structural modifications. While bringing the municipality through your front door will delay the remodel process and add costs, the point of permitting is to ensure compliance with well-established safety codes for your benefit.

Yes, inspectors with the city will not catch every small problem, but they will find glaring omissions that could impact your safety, so don’t be cheap and skimp out on their expertise!

Finally, the end product should meet your expectations during the construction process. It is essential to voice your concerns and withhold a portion of the payment until the job is to your liking. People will disappear mid-project if you pay too much upfront or refuse to correct the issue. I had numerous headaches, some of which could have been remedied by withholding payment until the end. Don’t hesitate to stand your ground and pay only for materials upfront.


Remodeling is an integral part of human culture, as we all want to live in spaces that meet our liking. For example, if you turn on the television in the United States, you are bound to stumble across at least a few home remodeling shows at a given moment. Still, home renovations are substantial undertakings when you are planning to change major features and fixtures. 

You can better prepare yourself for a remodel by determining the costs upfront and preparing best-case and worst-case budgets. Then, ensure you stick to your original plan and have time to dedicate to project management while properly permitting with your local municipality. Below, you will find a downloadable Microsoft Excel Spreadsheet to help you calculate your budget via the built in calculator feature while also keeping everything categorized.

I wish you the best of luck on your home endeavors, and be sure not to get caught up in every last detail; take a step back and breathe when things seem overwhelming. I look forward to writing on more topics pertaining to personal finance soon, and until then, have a great day!

Mile High Finance Guy

finance demystified, one mountain at a time

mile high finance guy

Leave a Reply

Your email address will not be published. Required fields are marked *