How Much Contingency Should You Add to Your Renovation Budget?
Renovating your home is exciting, but unexpected costs can quickly derail even the best-laid plans. That’s why building a contingency fund into your renovation budget is common for people who are looking to renovate. It acts as a financial cushion, helping you deal with surprises without stress or delays.
But how much should you set aside?
In this guide, we explain what a contingency fund is, why it matters, how much you might need, and how Beams helps reduce your exposure to hidden costs through smart planning and a data-driven approach.
What is a contingency fund?
A contingency fund is a portion of your renovation budget set aside for unplanned expenses. It’s your financial safety net, there to protect your project when something unexpected crops up.
You might need it if you uncover damp, outdated wiring, or rotting timber once walls come down. Or if a chosen material becomes unavailable and you need to switch to an alternative. While these issues can’t always be predicted, having a contingency means you’re ready to deal with them without derailing your renovation.
Why contingency matters in home renovations
Even the most carefully planned project can face surprises. A recent survey showed that 58% of homeowners exceed their renovation budget due to unforeseen issues.
This is especially common in older homes, where structural surprises can hide behind every wall. Material prices can rise unexpectedly, and sometimes you’ll want to tweak the design partway through. A contingency fund gives you the flexibility to adapt without financial strain.
If you're early in your planning, our cost of a house renovation guide offers a helpful overview of typical expenses. Just keep in mind that Beams pricing is always tailored to your specific project.
How much should you set aside?
The amount depends on your property’s age, the scope of work, and how much risk is involved. As a general rule:
10% for newer homes or minor cosmetic updates
20–25% for complex projects like extensions or loft conversions
For example, a £30,000 kitchen renovation with a 15% contingency means setting aside £4,500 to cover things like rewiring, plumbing upgrades, or material substitutions.
To explore some of the most common budget traps, check out our blog on hidden renovation costs.
When might you need more?
Some projects carry a higher risk of surprise costs. Consider increasing your contingency if:
Your home is over 100 years old
There’s been poor DIY work done previously
The property is listed or in a conservation area
Access is difficult (e.g. top-floor flats or narrow mews houses)
At Beams, we help you identify these risks during the planning stage, so they’re factored into your proposal from the start.
How Beams helps reduce the need for contingency
At Beams, we make home renovations more predictable by identifying potential issues before work begins.
We do this through a data-driven approach, using insights from over 4,000 UK construction projects and 3D scans of your space. This allows us to flag potential risks during planning — not once your build is already underway.
That’s why most Beams projects stay within 2% of their planned budget, compared to industry averages of 10–20% overrun.
Here’s what else we provide to give you greater cost control:
A dedicated renovation planner
Experienced designers who consult with build teams early
Transparent pricing tracked in your personal project dashboard
Vetted builders who meet our quality standards
All of this adds up to fewer surprises, better planning, and smoother delivery.
Tips for managing your contingency
Keep your contingency separate from your main budget so it’s only used when necessary
Track spending and prioritise essential fixes over aesthetic upgrades
Speak to your builder about when contingency might be used and how those decisions will be handled
If you’re financing the project, make sure your funding includes your contingency buffer
For help with financial planning, our guide on financing renovation work covers a range of funding options.
Should you tell your builder about your contingency fund?
It’s helpful to mention that you’ve planned for contingency, but you don’t need to disclose the full amount. This shows you’re financially prepared without making your budget feel flexible to others.
The Beams approach to budgeting with confidence
Traditional renovations often rely on guesswork and reactive decisions. At Beams, we take a proactive approach. By identifying risks upfront and providing clear, data-backed pricing, we reduce your need to over-allocate for the unknown.
That means more of your budget goes toward creating your ideal space — and less sits in reserve for emergencies.
Whether you're renovating a kitchen, bathroom or entire home, Beams gives you the tools, insight and support to move forward with confidence.
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