March 19, 2025

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How to set up a smart home without breaking your budget

How to set up a smart home without breaking your budget

Setting up a smart home may seem overwhelming, especially when dealing with unfamiliar technology and high costs. Many hesitate to automate their homes, assuming they must invest in a full suite. Home automation doesn’t have to break the bank. Start with a basic system and gradually add high-end smart home devices. This guide outlines how to take the first steps toward a smarter home.

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Creating a practical roadmap for home automation

Prioritize what adds value to your home. Consider your primary goals: Are you focused on better security, cutting energy costs, or simplifying your day-to-day? For example, smart thermostats are a great way to shrink your bills, while smart locks and cameras keep your home safer. To start, here’s my list:

  • Hub: The foundation of a smart home. (Priority)
  • Smart light bulbs: Three to five. (Priority)
  • Motion sensors: One or two to try out automation. (Priority)
  • Cameras: Good for security, but not a starting point.

Budgeting tips for your first smart home setup

After identifying your needs, set a budget and research options that fit within it. Don’t forget the hidden subscription fees. For example, most smart doorbells offer free real-time video streaming, but recording features often require a subscription.

Integration doesn’t matter if you plan to own only a few smart products and are comfortable managing them separately. However, a centralized platform ties it all together, giving you one app for device management, grouping controls with voice commands, and connected automation.

While Amazon, Google, and Apple lead the market, smaller brands like Homey offer budget-friendly alternatives with comparable features. I recommend an entry-level product from one of the big three due to the convenience and customer support.

Alexa

A smart speaker on a wooden table. The Alexa logo is illuminated on the top of the speaker.

Source: Unsplash

Alexa is a cost-effective option that’s compatible with most smart products. Devices like the Echo Dot offer an affordable starting point. Alexa features a library of over 130,000 voice-activated apps, known as Skills. Some Skills require manual setup or precise voice commands, which can be less user-friendly. Alexa depends on its app for mobile control, as it lacks integration with smartphones like Google Assistant or Siri. Additionally, its data collection practices have raised privacy concerns.

Apple HomeKit

black apple smart speaker on wood table next to tablet

Apple HomeKit integrates seamlessly with iPhone, iPad, Mac, and Apple Watch. It is a strong choice for users within the Apple ecosystem, even though Alexa and Google Home also support iOS. HomeKit prioritizes security and privacy, offering end-to-end encryption for its cloud communications. However, its stricter standards limit compatibility with third-party devices, making HomeKit-compatible products more expensive.

Google Home

The quick toggle menu of favorite devices in the Google Home app.

Google Home integrates seamlessly with the Google ecosystem, such as Android phones and Chromebooks. It offers native control for smart home management across these platforms. Like Alexa, it is affordable and an accessible entry point to smart home technologies. With Gemini support, Google Home excels at natural language understanding and image processing. However, its data collection practices have raised privacy concerns.

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Choose a budget hub for your first setup

You can control smart home devices from your smartphone using voice commands or a dedicated app. For a hands-free experience, you need a smart hub in your home. A smart speaker or display can serve as the hub for centralized control.

While both offer similar core functions, smart displays have additional features. They offer video streaming and a visual control interface, which is useful for those unfamiliar with voice commands. However, these added features come at a higher cost, as smart displays are typically twice as expensive as smart speakers.

Entry-level smart hubs include the Apple HomePod Mini, Amazon Echo Dot (5th Gen), and Google Nest Mini. The HomePod Mini, priced at $100, offers excellent sound quality, seamless HomeKit integration, Handoff technology with a U1 chip, and a temperature sensor, making it ideal for Apple users.

The Echo Dot, priced at $50, features a built-in mesh router to extend Wi-Fi coverage and a temperature sensor for automating routines, making it a solid option for Amazon users. At the same price, the Google Nest Mini comes with Chromecast integration, offering audio streaming for Google ecosystem users.

For those with a bigger pocket, smart display hubs like the Echo Show 5 and Google Nest Hub (2nd Gen) are priced at $90 and $100, respectively. Apple does not offer a dedicated smart display, but there are rumors that one is in development.

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Smart lights and motion sensors are a great starter combo

Combining motion sensors with smart lights is a cost-effective way to add fun, energy efficiency, and security in one solution. Smart lights are a great way to jazz up your decor. They come with adjustable brightness and RGB colors to set the mood for any occasion. Paired with motion sensors, they save energy by automatically turning lights on or off based on movement. This combination prevents break-ins by detecting motion and illuminating spaces, simulating life in a house.

Building your smart home around a strong core

You now have a solid foundation. When ready, expand your setup and add high-end gadgets like robot vacuums. Take your time, explore what suits your needs, and enjoy the process of turning your home into a space that works smarter for you.

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