What is an allowance in a home improvement project?

Allowances are guideline budget numbers which indicate how much you can spend on certain items. These items are generally finishes such as tile, doors, moldings, knobs and hardware, fixtures, or floor coverings. They are items that, at the time of bidding and contract, homeowners have usually not yet decided upon.

The allowance is not a fixed price, but a reliable ball park number which is determined by the homeowner's budget, taste, and needs. Generally, as long as you do not exceed this estimated number, you will not increase your overall project cost.

Allowances can include many items, so you should be very specific in your contract about what the items are. The allowance for items should include sales tax and delivery charges as well.

When deciding upon your allowance numbers, your contractor can help guide you, but you should do your research so that you have a good sense of what items cost. Pricing items online and in show rooms prior to writing in your allowance numbers will be helpful. Of course, your contractor will also have a sense of cost and should ask you lots of questions to determine what level of finish work you can choose and still keep you within your budget.

Allowances give you flexibility and time to select finish items that you like. But be careful, they can add up. And since these are the cosmetic items, which are fun to select, you could get carried away. Remember, it's ultimately the homeowner's responsibility to be familiar with the cost of items for which you make allowances.

Your contractor is there to guide you so be sure you ask lots of questions and keep an open line of communication. This will keep your project on time, on budget, and as stress-free as possible.