Renovation Guide: How to Renovate Without Draining Your Savings with MrMoneyTV

Did you know that many Malaysian homeowners end up spending significantly more than they planned on their renovations? It’s a common issue – turning your dream home into a reality can quickly become a financial challenge. Whether it’s a desire for a modern kitchen, an upgraded living space, or simply some home improvements, the excitement of creating your ideal space can sometimes overshadow the importance of careful financial planning.

But, it can be tough to stay on track financially. Many of us face unexpected costs, which make our budgets go up and causing financial issues. Careful planning and budgeting are very important to make sure our renovation goes smoothly and doesn’t cost too much.

To give you expert advice on handling the money side of home renovation, we talked to Peter Yong, the man behind MrMoneyTV, the financial edutainment platform in Malaysia, a money expert with good ideas about how to budget well. By learning how to set budgets, plan for surprises, and manage costs, you can make your renovation dreams real without spending too much.

Renovation Budgeting Tips from Peter Yong of MrMoneyTV

Q: How should we start planning a renovation budget?

A: “I think the first thing is to discover affordability. Before you start any renovation, know how much you can afford and set limits. Don’t spend all your savings, which can leave you in trouble if something unexpected happens. It’s important to have an emergency fund. One of the main reasons that people blow their budget is the lack of research.” This means planning well, looking at different design ideas, and talking to experts. Ask them about possible problems and how much they might cost. Good research helps you know what to expect and avoids surprises.

Q: How can we be sure we can afford a renovation without spending too much?

A: When you’re making your budget, plan for extra costs. “Always price at an error.” For example, if you want to spend RM50,000 on your renovation, plan as if you’re only spending RM30,000 at first. This gives you some extra money in case things cost more than you thought.

Q: How important is it to have extra money set aside, and how much should we save for unexpected costs?

A: Having extra money is very important. “To be very, very safe, always set a 50% margin.” But, if you plan carefully, you might only need about 20-30% extra. If you think your renovation will cost RM100,000, it’s a good idea to save RM130,000 to be safe.

Q: How can we keep track of our renovation spending?

A: Have a system to watch your costs closely. A tool like a spreadsheet can be very helpful. Write down what you plan to spend and what you actually spend. Track your spending step by step, so you can make changes if you need to. Don’t buy big things early on, like furniture, because they might not fit if you change the layout of your house.

Q: What if our budget isn’t enough for all the renovations we want?

A: If you don’t have enough money for everything you want to do, be ready to change your plans and do the renovation in stages. “Maybe you can always go into phases.” Start with the most important things, like fixing structural issues, or focus on one area at a time, starting with the area you use the most. This way, you can manage the costs better.

Q: Will renovations increase the value of a house a lot?

A: It’s important to be realistic about how much money you’ll get back from your renovation. “Renovation cost is actually a sunk cost almost. You probably can recover about 20 to 30%.” So, don’t renovate just to make your house worth more. Very personal renovations might even make it harder to sell your house.

Q: What should we do if we plan to sell our house after renovating?

A: If you plan to sell your house later, focus on changes that will appeal to many buyers. “The key thing about selling your house with a good value is just clean.” A fresh coat of paint, a clean and tidy home, and simple design choices are often better for selling than very unique or fancy renovations.

Q: How can we make sure we’re secure financially during and after the renovation?

A: Good money management is key throughout your renovation. “My philosophy of it is that try not to renovate if you can’t afford it.” Make sure you have enough money to pay for everything and still have money left over afterwards. Plan carefully to avoid money problems and stay in a good financial position.

Key Ideas for Renovation Budgeting (According to MrMoneyTV)

Peter Yong says that good renovation budgeting depends on two main things:

• Focus on What You Can Afford: It’s important not to use all your savings on renovation. Keep some money aside for emergencies to feel secure.
• Do Good Research: Not doing enough research is a big reason why budgets go over.

By using these budgeting ideas and tips from MrMoneyTV, Malaysian homeowners and future homeowners can plan their renovations more confidently, lower the risk of money problems, and work towards creating their dream homes without getting into debt or facing financial difficulties.

Ready to begin your renovation journey? Connect with trusted interior professionals or browse through their projects for more ideas.