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Construction Budgets as a Savings Tool

Contractor Plans

We’ve all heard that home improvement projects “always take longer and cost more than you expect them to.” However, here’s a great article from homebuildingremodeling.com that illustrates how you can use a project budget and a detailed schedule as tools to buck this conventional thinking, while saving you both time and money on your next project.  We hope you find these simple tools as useful as we do.

Creating a budget and schedule for a construction project is going to be a great savings tool for you. While you can save money by shopping around for the best bargains, getting the best subs for the best prices, and many other cost cutting, money saving keys, it is important to realize that one of your biggest money savers is going to be your budget and schedule. These will help you to create a viable way to build the house you want at the price you want, and stay on task to do it.

If you are going to use your budget and schedule as a savings tool, you definitely need to have one. A great way to figure out the very most realistic budget and schedule you can is to get some help. In fact, your best option is to have a general contractor do it for you.

You probably want to save money by not using a general contractor, but using them as a resource is a great idea. What you are going to do is make sure you have all of your options covered. In case of the unforeseen, you might end up turning your project over to a general contractor anyway, so it doesn’t hurt to find a few and get bids on your project right from the start. Their bid will be extremely helpful to you in planning and budgeting your work, but only if you can get the most thorough bids possible. So, when you ask for a bid for your project ask for the following:

1. A written cost break down or budget. This is something you will want to see broken down well so that you can see what each line item will cost you separately. It will help you see what your most expensive items are, and give you an idea of where you should look harder for a bargain.

2. Have them indicate in writing (with contact info) who will likely perform each line item. In other words, have them tell you which subs they are going to be using. This is especially important so you can compare this bid to that of the other general contractors you get bids from, and find subs that can do your jobs well and for great prices.

3. A written calendar of completion, or in other words a schedule that meets your deadline. You will likely want to have them draw up a schedule for a six-month project. Have them break your construction project down and show you how long each item will take.
When you ask for the bid remember that if they give you a good enough price, it might be worth using them, so simply be straight forward with them, and challenge them to give you the best price they can. If you tell them that you will defer building, go with another contractor, or build your house yourself if their prices aren’t good enough, so you would like their best price, you will likely get it. Give them a chance to talk you out of owner building, and into using their services, but only if the price is right.

This approach will help you in two ways. One it will give you a more accurate idea of what your costs are going to be, you won’t have nearly as much mark-up from the general contractor, and two it gives you an option in case you find you can’t, or don’t want to owner build after all.

Use the information the general contractors provide you to come up with your budget and schedule. They have been doing this for a long time, and likely will be accurate in their bids, with some mark-up. Utilize your resources well, and your budget and schedule will act as a money saver you did not even realize you had.

One great resource available to homeowners and contractors alike to help with a project plan and budget is Contract Smart.  Through its innovative Bid and Contract Management Service, Contract Smart Member Contractors can collaborate with homeowners to develop a step by step project plan. With specific project goals and a timeline with payments tied to project completion, the Bid and Contract Management System can provide clarity and peace of mind for your project.  Contract Smart’s Bid and Contract Management System is currently available in Colorado. If you live outside Colorado, please check back with Contract Smart frequently for updates regarding our national expansion.


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