Creating a budget for an interior design project is a crucial step to ensure that your project stays on track financially. It will also give you peace of mind that you’re not being taken advantage of of misled by trades and salespeople. Here’s a step-by-step guide on how to create a budget for an interior design project:
1. Define Your Project Scope
Clearly outline the goals, objectives, and scope of your interior design project. Determine what rooms or areas you will be working on, the extent of the changes you want to make, and the overall design style you’re aiming for.
At TSD, we like to create a scope of work document, organized by room, with a line item for each and every thing that needs to be done to the room. This would include any renovations, trade labor, materials, fixture and finishes, and furniture and accessories. The little things can add up, but they also help to finish the space, so it is important to include every last detail in your scope of work.
2. Set Priorities
Identify your priorities for the project. Once you’ve created your scope of work and itemized every detail, you may realize that some things are more important than others. Determining which aspects of the design are most important to you, such as furniture, decor, paint, flooring, or lighting, will help you allocate funds more effectively.
3. Determine the Budget Amount
Decide on the total amount of money you are willing to allocate to the project. This should be a realistic and well-thought-out number that takes into account your financial situation. This may come from your savings, a home equity loan, or some other source, but typically you will have a number that you don’t want to go beyond.
4. Break Down the Budget
Divide your budget into categories such as furniture, decor, paint, materials, labor, and any other relevant expenses. Alternately, you can divide your budget by room. Choose a method that makes sense for your project. Allocate a percentage or specific amount to each category based on your priorities and the scope of the project.
5. Research Costs
Research the costs associated with each category. This includes the cost of materials, furniture, fixtures, contractors, designers, and any other expenses. Gather quotes and estimates from suppliers and service providers.
6. Consider Hidden Costs
Be sure to account for potential hidden costs, such as taxes, shipping fees, permits, design consultations, and unexpected expenses that may arise during the project. Planning a contingency into your budget can help you manage these situations. A 10% contingency is typical for most projects.
7. Create a Detailed Budget Spreadsheet
Use a spreadsheet or budgeting tool to create a detailed breakdown of your budget. Love them or hate them, spreadsheets help you organize your expenses and account for every last item in your project. List each category, the estimated cost, actual cost (as you make purchases), and any notes or details relevant to each expense.
8. Prioritize Spending
Allocate your budget according to your priorities. If certain categories are more important to you, be prepared to allocate a larger portion of your budget to those areas. Keep in mind that items that are a lower priority may have to get cut from the project or put on hold until a second phase of the project.
9. Track Expenses
Regularly update your budget spreadsheet as you make purchases and payments. This will help you stay on top of your spending and ensure that you don’t exceed your allocated budget. At TSD, we create a column for actual costs right next to the projected costs so we can quickly compare the difference and see where we need to make adjustments.
You’ll also want to periodically review your budget throughout the project. If you find that you’re overspending in one category, look for ways to reallocate funds from other areas or make adjustments to your design plans in order to hit your overall budget goal.
10. Consult with Professionals
If you’re working with an interior designer or contractor, they can provide valuable insights into budgeting for various aspects of the project. Professionals who work in the design and building industry everyday will have a better sense of what materials and labor will cost in your current market. They can help you understand realistic cost expectations and guide you in making informed decisions.
Remember that creating and managing a budget for an interior design project requires careful planning and attention to detail. By following these steps, you’ll be better equipped to keep your project financially organized and achieve the design results you desire.