The new year is a good time to upgrade your home. But materials and labor costs for home improvement projects are on the rise. To save money as you fix up your house, try these tactics.

Think small for a big impact. A fresh coat of paint, updated vanity fixtures and a new shower curtain can make your bathroom feel like a new space—at a fraction of what you’d pay for a full renovation. Or add a cute bench with a seasonal blanket and pillows as a way to elevate your entryway at little cost.

Negotiate the price. Contractors often bake an extra 5 or 10 percent into their bid for a project with the expectation that you’ll negotiate, says Vishwas Prabhakara, founder and CEO of handyman service Honey Homes. Collect a few quotes and then ask the leading contender if there’s wiggle room on the price.

Be strategic. Use more-expensive materials sparingly, with a focus on high-impact areas. Instead of tiling your entire kitchen backsplash in marble mosaic, you might use it as an accent over the range, says Miriam Rowe, an interior designer with Curio Design Studio. Or use a stock color for your main kitchen cabinets and a custom color for a smaller island or hutch.

Save with energy incentives. While many of the energy-efficiency tax credits and deductions previously available under the Inflation Reduction Act expired at the end of 2025, you may still be eligible for rebates or other incentives from product manufacturers or energy providers. Check dsireusa.org to see if you qualify for any state programs.

Seek out sales. The cost of materials is the major cause of budget overruns for the typical home improvement project, according to Block Renovation’s 2025 “How America Renovates” report. Keep your expenses in check by taking advantage of home improvement stores’ frequent sales. You can ask store staff when a specific item might get marked down.

Schedule selectively. For everything there is a season, including your next home project. Avoid booking work for the spring or fall, when contractors are typically the busiest. “Midsummer is probably your best bet for getting a deal because a lot of people don’t want the mess while the kids are home from school,” says Tamara Day, author of Laid-Back Luxe: How to Create Aspirational and Attainable Living Spaces.

DIY with rented tools. Rather than paying a professional contractor for smaller jobs, rent the tools and take care of them yourself. You can rent a carpet cleaner, a pressure washer or even a ladder from home improvement stores for less than $100.

Go to aarp.org/99waystosave to find even more savings tips.