How am I going to pay for a renovation?
Knowing what upgrades your home needs is one thing. Figuring out how to make those upgrades fit into your budget can be a challenge.
Home energy upgrades can be a significant investment, but often, it’s possible to take a step-wise approach to renovations. Taking the time to understand your home’s needs, and the cost of each piece of the work, can make it easier to figure out how to get started.
Step 1: Making a Plan
Generally speaking, there are two ways to go about deciding on how to proceed with renovations – a ‘budget first’ pathway vs. an ‘energy audit first’ pathway. The difference in approach is explained below:
A) Start With Your Finances – the ‘budget first’ pathway
If you already have an idea of what you can comfortably afford or you want to figure out how much you are comfortable adding to your household budget – you can start by exploring your financial options and setting a renovation budget. This could include:
- looking at your savings – either existing savings or planning for savings with e.g. a Tax Free Savings Account
- potential loan options – such as the specific NLCU loan through the Shift Program,
- refinancing or restructuring your mortgage – such as changing the amortization period or looking at e.g. a Home Equity Line of Credit (HELOC) type mortgage
- or some combination of the above.
If you want some help figuring out what you can afford, The Shift Program has partnered with Newfound Wealth Advisors, a local financial literacy business. Newfound Wealth Advisors is offering a free initial call to Shift Program participants.
Once you have an idea of your available budget, the next step is to undertake an energy audit to help you understand your home’s energy needs and identify which upgrades could be completed within that budget.
B) Start With an Energy Audit – the ‘energy audit first’ pathway
An alternative way forward is starting with an energy audit to understand what renovations and upgrades would make the most difference in your home’s energy use. An energy audit can help you identify and prioritize potential upgrades based on your home’s energy performance.
Once you know which renovations you want to take on, you can get quotes, look into available rebates, and estimate the total project cost. Once you have the contractor quotes and total project estimate, you can then determine what financing options are available to you.
There isn’t one ‘right’ approach. You can start with your finances and see what fits, or start with your home’s needs and work out the finances from there. Each household can determine the best way forward for their needs and comfort level.
Step 2: Understand Your Financing Options
Through our financial literacy series, Making It Work: Financing Your Home Upgrades, our financial literacy partner Rob Tizzard, discusses topics such as planning for renovation costs and understanding financing options.
The goal of this series isn’t to tell you which option to choose; it’s to help you understand some options so you can make better informed decisions around what’s best for your particular household needs.
Step 3: Get One-on-One Guidance
Sometimes, the best way to make sense of your options is to talk through them with a professional.
The Shift Program works with financial advisor Rob Tizzard of Newfound Wealth Advisors to help homeowners better understand the financial side of home upgrades. Shift Program participants can reach out at [email protected] and we can arrange a free 30-minute consultation with Rob. This gives you an opportunity to discuss your renovation goals and ask questions about the financial side of your project.
You can also explore our financial literacy video series for information you can review at your own pace.
Ready to get started?
The Shift Program is here to help you prioritize your project and better understand your next steps. Connecting you with a trusted financial advisor is part of that process.
Reach out and book an introductory call with us today to learn more about your options!
Content provided for informational purposes only. Please refer to our Program Terms & Conditions for full details.