hot tub on a budget

When you are thinking about installing a hot tub, you probably have all sorts of ideas in your head about how wonderful it will be to use it. Maybe you have already taken a look at the options out there, chosen the perfect spot for installation, and even investigated the energy efficiency you can expect— and what that might mean for your utility bills. That ongoing cost is certainly a consideration, as is the initial price of the hot tub. When creating a hot tub budget, expect something along these lines for the purchase:

  •   Entry-level tubs: $1,500 to $4,000
  •   Mid-level tubs: $4,000 to $8,000
  •   Premium tubs: $8,000 to $18,000 or more.

Most of us don’t have that kind of cash lying around, so creating a hot tub budget is essential. Creating a budget might seem daunting, but by taking careful and sure steps along the way, you can take the mystery out of budgeting and come up with a comfortable dollar amount to spend on a hot tub.

Budgeting for Your Hot Tub

When creating a budget for your hot tub, it’s important to keep the average prices in mind. A simple, straightforward hot tub can set you back by a few thousand, but if you’re going for all the bells and whistles, expect to pay much more.

This price can also go up if you choose to go with some custom work, like a dedicated deck or patio for the hot tub, a pergola or gazebo over the tub for more energy efficiency and ambiance, or even a custom cabinet that matches the color of your home. Since a hot tub must have a level surface to operate properly, even the most affordable tub will have a higher price if a professional must pour a concrete slab before installation.

As you think about what you want in a hot tub, run the numbers with a sales representative. Speak to contractors about what it might take to install the hot tub of your dreams. Then look at that bottom line. Will your hot tub budget meet the price of all the things you want?

To be sure, let’s look at figuring out how much you can actually afford.

How Much Can You Afford?

Deciding what you can afford requires you to focus on your income, expenses, what you need versus what you want, and find a number you’re comfortable with spending. Look at what’s coming in, what’s going out, and what disposable income you have to spend on the hot tub of your dreams. Start with the big ideas and then lower your expectations if the dollar amount available to you doesn’t meet those high-dollar plans.

There are many ways to tap into more money than you might have on hand in your checking account. Ideally, money in a savings account that is earmarked for home repairs and improvements is best. But many homeowners simply don’t have that kind of cash lying around, so they turn to loans – specifically, to home equity loans.

What Is Your Home Equity?

You’ve probably heard of a home equity line of credit. That’s a line of credit offered by the bank that holds the mortgage on your home. It’s essentially a loan that borrows against the equity you hold in your home. What’s home equity? That’s the difference between what you owe on your home and the appraised market value of that home. For instance, if you owe $100,000 on a home that is appraised at $200,000, your home equity is $100,000. That’s how much of a true investment of cash you have in your home at that point in time.

The more equity you hold in your home, the more likely your bank will offer you a line of credit. Your home equity gives you power over your finances, allowing you to borrow against your home to purchase items or improve the property – such as with the addition of a hot tub.

What Is Your Credit Rating?

In addition to the equity in your home, your credit rating is one of the factors your bank will consider in deciding whether to give you a loan, and how much that loan will be. A credit score is often considered a barometer of overall financial health; the Consumer Financial Protection Bureau says a credit score “predicts how likely you are to pay back a loan on time.”

But it’s not just the bottom line of that credit score that matters. Banks will also look at your credit reports. Those reports provide a clear breakdown of the activity on your credit cards, how current you are on payments, the amount of credit you have available to you, and much more.

Before diving into the options for loans, check your credit report yourself to make sure there’s no incorrect information. There are three companies that provide credit reports: TransUnion, Equifax, and Experian. You can get a free copy of your credit report every year from each company by requesting them through AnnualCreditReport.com.

Be Real About Your Hot Tub Needs

Anyone who starts thinking about adding something to their home will often go overboard with their first spate of ideas, which is actually a good thing – it’s advantageous to make a list of all the things you want, because you can then evaluate what matters most and gradually narrow that list down to what you actually need in a hot tub.

For instance, you might really want that sound system, but do you want to install that if it means you can’t afford the number of seats you want or the extra jets? Give a good look at what you really need in your new investment before you get in touch with the contractor.

Speaking of contractors, you’ll need a good one to help guide you through the process of figuring out how to handle the installation and any new construction while still keeping the price under your hot tub budget.

Modernize is happy to connect you with contractors in your local area who can look at your needs, your wants, and your hot tub budget, and help you find the sweet spot that makes you feel good about your investment. Let us connect you today and you can begin working toward your dreams of a hot tub as soon as possible.

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Author S Krone

A lawyer never retires. So I would just say that I am not as active as I used to be. Now I simply dedicate myself to fishing, my hobby, and my grandchildren. For Business Finance News I write about legal aspects of mortgage policies, mostly regarding the rights of policyholders. I also have articles about personal injuries.

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