It’s obvious that improvement projects cost money. However, many people underestimate just how expensive home improvement remodeling costs can become. It’s vital that you create a realistic budget for your home improvement ideas: Home improvement projects that run over budget can strain your finances or remain unfinished due to lack of funds.

Using a Home Improvement Calculator

Before you bring calculating home improvement costs, you’ll need some numbers to work with. In addition to labor, materials and other home remodeling costs, you’ll also need a list of your monthly expenses and current debt load. These figures will help you determine your maximum home improvement budget.

Now, you could sit down and crunch the numbers yourself, or you could use an online home improvement calculator. With a home improvement calculator, all you need to do is enter your figures and hit the calculate button. This helpful tool will give you a reasonably accurate home improvement budget range.

Unexpected Home Improvement Costs

Once you have a budget for home remodeling costs, add on a percent for unexpected expenses. No matter what home improvement ideas you have, it’s almost guaranteed that there’ll be unexpected (and expensive) surprises.

What percentage of your total budget should you add to your home improvement costs? It’s recommended you add between 5 to 20 percent, depending on the nature of your home improvement projects.

Generally speaking, if your home remodeling includes modifying or opening ceilings, walls and floors, you should add the full 20 percent for emergencies. No one, including home improvement contractors, can predict what’s lurking behind your walls and floors. An apparently simple bathroom remodel can be complicated if opening up the wall reveals mold or plumbing in a state of disrepair.

On the other hand, smaller home improvement ideas may only need 5 percent of the total costs added to cover emergencies. As with most budgets, it’s better to err on the side of caution with unexpected home improvement costs and budget for more than you actually need.

Hidden Home Remodeling Costs

Some home improvement costs are obvious: Materials and labor, for instance, aren’t likely to be forgotten when budgeting for home improvement ideas. Other costs, however, may go unnoticed.

For instance, if you plan on financing home improvement projects through a loan or line of credit, you must factor in the loan’s closing costs and interest. Some of these expenses may be mitigated at tax time: Interest on home improvement loans is often tax deductible.

You’ll also need to consider the effect of your home improvement ideas on your property taxes. Completely remodeling a home–or even a kitchen–can increase your property taxes significantly.

Budgeting for home improvement projects doesn’t have to be complicated. Calculating home remodeling costs simply requires some patience and a realistic grasp of your finances.