VOL. 133 | NO. 173 | Friday, August 31, 2018
Rays of Wisdom
Dana and Ray Brandon
Funding Home Improvement Projects
Ray and Dana Brandon
Ray’s Take: If you talk to any homeowner, he or she can probably spout a list of 10 things that need to be repaired or improved on their home – whether the home is brand new or 50 years old, it usually makes no difference. Whether it be a new deck or a new roof, at some point in your life, you will want to start a special home improvement project.
I meet with clients all the time who have allowed these projects to get completely out of control and cause serious damage to other plans like their kids’ education or even their own retirement because they didn’t stay on budget when embarking on a home improvement project.
My first piece of advice is to carefully consider what the project is you want to fund. Adding a pool, an irrigation system or a new deck may be something you really want but will not necessarily add value to your home and may end up costing more in the long run by taxing your monthly budget.
Next, have a written, itemized plan and don’t deviate from it. Get several estimates and stay on budget. I always recommend saving and paying in cash. You will save money by avoiding finance charges and interest. There’s a good chance your contractor, a friend or even your spouse will suggest additional upgrades, more expensive materials or other added items that will increase what was outlined in the original plan. Stay true to your planned budget.
From many years’ experience, I have two important final bits of advice.
First, be honest. If you really want something, that’s reason enough to seriously evaluate doing it. Stop trying to dress it up as an investment. Second, if you can work it out financially, do it sooner rather than later. I can’t tell you how many times my clients finally get around to adding and fixing things in their home just before they put it on the market to sell, only to love it so much they have second thoughts about selling it at all. It’s often the small luxuries that we enjoy every day that we get the most value from.
Dana’s Take: This summer, Ray and I visited the Normandy and Loire Valley regions of France. My American eyes had a strange reaction. The houses were modest. People live in homes over 100 years old – and don’t add on to them. I honestly felt an urge to add a deck and master suite to these houses.
I think the French have a sense of contentment, absent in the American psyche. We always have a drive to improve and acquire more things.
I’m not sure if the answer lies in moving to France, or in accepting our drive for more and balancing that with our financial well-being.
Ray Brandon, CEO of Brandon Financial Planning, and his wife, Dana, a licensed clinical social worker, can be reached at brandonplanning.com.