What contingency covers
A contingency is a reserve for uncertainty, not a hidden line item. Concealed damage, quantity changes, access problems or required corrections can change a project after work starts. Keeping the reserve separate shows the difference between known scope and risk.
Choose a percentage thoughtfully
A straightforward new installation with well-documented conditions may need a different reserve than work in an older home where walls, roofing or subfloors will be opened. The calculator does not recommend one universal percentage.
Allowances versus contingency
An allowance is for a known but undecided item, such as tile selection. Contingency is for uncertainty. Listing them separately prevents the same dollars from being counted twice.
Frequently asked questions
Should contingency be included in the contractor contract?
Not necessarily. It can remain an owner-controlled reserve, with changes documented and approved as needed.
Does financing cost belong here?
No. Financing cost should be evaluated separately unless included deliberately in the base estimate.
Review our methodology and see worked project examples.