With January being the time to set goals and formulate plans for the coming year, renovation will be on the mind for many Australians. We all know that home improvement is a reliable way to increase the value of a home or property, yet we are often unprepared to meet the financial requirements for funding serious renovations.
According to Finder, less than half of us are able to sick to our new years resolutions, which is a shame. With the right mindset and a little financial planning and assistance, there's no reason why any of us can't reap the benefits of sticking to a goal this year.
Your home, your castle, your pet project
Australians are a busy bunch when it comes to renovations, according to Roy Morgan Research. Close to 8.4 million Australian homeowners undertook some sort of renovation project in the last 12 months, a figure that has grown considerably over the years. Michele Levine, CEO of Roy Morgan Research, explains:
"The latest figures from Roy Morgan show that, over the last few years, an increasing number of Australians are doing renovations or repairs of some description to their homes. Even bearing in mind that the number of people who own or are paying off a home has grown by 400,000 since 2013, the trend towards domestic improvement is still trending upwards."
However, as we can all attest, renovations don't come cheap. The Housing industry of Australia reports that in 2015, over $30 billion was spend on home renovations, with a quarter of all projects costing between $12,000 and $40,000.
Roy Morgan shows that over 2.2 million homeowners spent over $5,000 renovating or extending their home.
Whether you're looking to add some easy capital to your home, or simply inspired by the man home renovation shows, we're all going to have to find the funds necessary to finance such resolutions. The idea might be nice, and the goal to set aside enough money this year to complete them is a good one, yet why is it so hard to stick to them?
Why do we break our resolutions?
Less than half of Australians manage to achieve their new year's resolutions, reports Finder. Out of a national survey, 58 per cent of respondents did not achieve what they set out to do last year. But why? It's not as though the goals weren't important, so gaining insight into why we're likely to give up on them might actually help us keep them.
According to Finder, making a resolution without having a plan is one of the most common reasons why they fail. It's a shame, especially as it's an easily-avoided pitfall. For long-term resolutions like saving to buy a home or improvements, without a way to keep track of progress, many Australians essentially floundering in the water and are more likely to abandon such ambitions.
Yet it's not a even spread. It would appear that different parts of the country display different ability to keep their resolutions. According to the survey, Tasmanians are the most likely to stick to their goals, and it's paying off for them in surprising ways.
It would appear that different parts of the country display different ability to keep their resolutions.
Tasmanians benefiting from setting (and keeping) resolutions.
Perhaps it's unsurprising that because of their heightened ability to stick to their financial resolutions, .id reports that Tasmania has the highest proportion of renovation activity out of the entire country. While, understandably, $110 million spent in Tasmania on renovations pales to the spending of Victoria's $2.3 billion, proportionately 18.9 per cent of Tasmanians added value to their homes via renovations, whereas only 11.6 per cent of Victorians did the same.
It may also explain why Tasmanians outshone the rest of the country in 2016 for the highest gross yields for dwellings or units within 10 kilometres of the capital city, according to CoreLogic. Evidently, it pays to stick to our goals.
How can we better achieve our financial goals?
For small-scale resolutions, getting help from friends an family is an effective way to stick to one. For larger, more expensive projects you may find it better to seek help from a financial advisor. Financial advice is perfect for breaking a goal into two manageable categories: time and money. By formulating a timeline and a clear financial plan, you stand a much better chance of achieving them.
A financial advisor can not only help you establish and reach your goals faster, they offer many insights on how to maximise your savings whilst decreasing your expenses, creating a sound budget for the short and long term, and help develop risk-management strategies so that you're better prepared for any future incidents.
To find out more about how getting some expert financial advice can help you realise your financial goals, get in touch with the team at The REIN Group today.