Do you enjoy woodworking?  Do you have a budget that you have set aside just for your woodworking?  If you are not a millionaire, than more than likely you will have some sort of a budget.  Let me give you a little insight into why you are here and what you will find on this site.  Do you enjoy woodworking as a hobby, part-time job or side job, or a full time job?  Or maybe you are wanting to turn your hobby into a full time job.  If that sounds like you than  your in the right place. 

Not many YouTube woodworking channels are run by guys who also happen to have PhD’s in medicinal chemistry, but this one is. Brian Grella’s channel offers a mix between more atmospheric videos that aren’t heavy on explanations (as the one shown above), and ones that are firmly in how-to territory, like this one for making a beautiful wooden bowl using nothing but a router and a drill press (no lathe required):
All you need to get an edge on your hand tools and pocket knives is a 100/300 grit combo stone from your local hardware, even horrible fright. This shouldn't cost more than $10. Then go to the natural slate section of the home center or flooring store & find 3-4" natural slate tile that you can barely see the grains in. This should cost another $1 or so. This tile is roughly 800 grit. If you can't find natural tile in your area, you should be able to find an 'Arkansas' stone for <$5. If you can scare up some Chrome Oxide and a piece of leather (piece of cardboard or block of MDF also work) all the better. These three things will cost you $15 and get your edged tools sharp enough to take hair off your arm and chips of your lumber.
I, too, would pass on the Jawhorse, and agree with the suggestion of a solid bench. (Remember, it can double as a desk if space is limited.)  A used solid-core door can be a starting point, but there are better options, such as laminating your own from scrounged 2x4s. Spending time at flea markets looking for old tools that can be reconditioned is a good suggestion, too.
Raw material is a concept. A concept that we describe as any material that has yet to find its final home. It is a material that is en route to becoming something interesting, creative and more permanent in the world. If it has yet to be worked and transformed to create a unique piece of woodworking or artisan craftsmanship, then it is still raw to us.
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Just how small?  Will you have an extra bedroom for your shop or will you be doing woodworking in your living room?  Do you have to put the projects and tools away every time you want to entertain or will you leave everything set up all the time?  A while back FWW had a video tour of a shop in Japan that was smaller than small.  I'll try to find it and get back.  Found it...  shows what can be done in a small space but this shop was not on a small budget so no help there.
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