Monday, April 20, 2009

Redecorating on a Budget - The Costs and 3 Tips

One of the things I remember when I was in the process of getting my first mortgage before any refinances etc, is that they said that you had to plan to have about 1% of the value of your home in addition to mortgage payments set aside. This money was to handle the upkeep of such a home.

Fortuntately, I have been in the position that there hasn't really been a ton of upkeep. The roof was replaced which was a pretty big expense and there were a few other minor things. However, when all is said and done, it was pretty reasonable given the quality of the space that this money had purchased.

Even now, in the midst of spending a tidy sum on redoing the two bedrooms, I can't help but feel like this is money that needs to be spent; it is not extravagant and it should help the value of the place as well as the quality of life overall.

So far, these have been the expenses:
2300 dollars for new carpeting (original was over 15 years old).
120 dollars for paint
200 dollars for new curtains and curtain rods.

After that, I'm expecting between 2500-3000 for living room furniture that will be used to go in the living room and some of the downstairs furniture that is still usable will come upstairs -- at least that is the plan right now.

Figure another couple of hundred dollars for curtains downstairs and then I think that the grand total will be in the neighborhood of 5500 dollars for redecorating 3 of the 5 main rooms in the house, including quite a bit of furniture.

These were the things I did that I think has helped keep the costs reasonable:
1. Reuse furniture if possible. Often times, you just need to change rooms and the furniture becomes usable again. I did this and used an old antique that was in storage.
2. When doing work with contractors, try to hire locally in a bad economy. You may get a better deal than with a chain. Be sure to include an estimate.
3. Shop around, even at chains you normally ignore. I was able to score very nice curtains at Bed Bath and Beyond that were not much more expensive than Wal-Mart curtains I bought for the other room, just by shopping around.

Wednesday, April 01, 2009

Loan Payoff and Change of Color

Well another major hurdle has been met for the personal finance journey to get out of debt. Amazingly, the car loan is now paid off and there is a significant improvement in the ability to have free cash flow each month as a result. Doing a debt snowball is extremely daunting, but now, nearly 2 years after my original start, I am starting to really really see the benefits. Other than the mortgage, there is only one loan left, and it is a student loan that gets paid at an accelerated schedule.

What this means

In reality, there is not much to doing this other than paying off bills early and aggressively, but in terms of the psychological benefits, it is just amazing. I feel more free than I have ever felt and along with the emergency fund, having additional free cash flow makes it quite easy to feel I could survive comfortably for a large number of months if I were to suffer any loss in income.

Taking Rewards

One important thing to realize when making these kinds of big progress milestones is to take some kind of reward. For me, this reward has been threefold.

First I decided to repaint a room in the upstairs of the condo. This is a good investment of time and money and I think that it looks great. A nice bright and neutral color. The amazing thing about this personal finance journey is that way it can permeate your entire life for the better.

Personally, I've found myself to be more upbeat and happy. Furthermore, with less debt, I am able to confidently make positive changes in my environment that require spending money for good reasons like repainting a room. And for the cost of about 80 dollars worth of new paint and supplies, the improvement to the room is simply amazing. I highly recommend making one or two small changes of this nature in your own environment and seeing the positive impact.

Second, I've decided to try to be more productive during my trips to and from the office. I've bought a small netbook computer which is compact enough that it allows me to use it comfortably on a cramped subway. This has seriously helped increase my productivity already since most of my work is typing of some sort.

Third, I've decided to upgrade internet systems. Now I am using the comcast internet cable in order to be able to have a better connection and keep everything on one bill. This is my first night using it and so far it is great and I really do notice a difference.