The kitchen is the heart of your home. But, if your kitchen is dated or the layout does not work for you, you may not spend as much time in your kitchen as you would like. A kitchen remodel can help to make your kitchen more functional, while also helping to make it a place you want to be and show off. There are many important things to do prior to a kitchen remodel, and one of those things includes setting aside a contingency fund. Here are some of the questions you may have about a contingency fund and the answers to those questions.
What Is a Contingency Fund and Why Is It Important to Have One?
A contingency fund is essentially money that is set aside to cover unexpected expenses that may occur during a kitchen remodeling project. When a contractor gives you a quote for a kitchen remodeling project, they are giving you a quote based on what they see and know at the time of the quote. Things change, and prices can increase or there may be hidden damage once they start demolishing your kitchen. A contingency fund helps to cover these expenses.
What Types of Obstacles May a Contingency Fund Help Cover?
A contingency fund can help to cover many obstacles and unexpected expenses that can pop up during a kitchen remodel. Hidden water damage and mold are two common issues that come to light during kitchen remodels. Increased product costs can also lead you to dip into your contingency fund. A contractor may price out one product for your new kitchen, but that product may go out of stock or increase in price before it is purchased. Delays due to slow permitting processes or code enforcement inspections can also lead to an increased renovation price.
How Much Money Should You Have For a Contingency Fund?
Most contractors recommend that your contingency fund be about 20 percent of the cost of your kitchen remodeling budget. If you have an older home, you may want to set aside even more money. Always talk to your kitchen remodeling contractor about a contingency fund and how much they recommend you set aside based on the age and condition of your current kitchen.
Remodeling your kitchen can improve its appearance, making it a place you want to spend more time in. However, once a contractor starts pulling out cabinets and removing flooring, they may find damage that no one knew was present. Having a contingency fund in place helps to ensure that you have the money to address unexpected expenses, without having to forego some of the elements or finishes that you wanted to incorporate into your new kitchen.