(MONEY Magazine) – What to do with a chopped-up kitchen, breakfast nook and mudroom? Plus an ill-conceived addition that resulted in a cramped 10-foot-by-10-foot family room? If you're the owners of the 1927 red-brick Colonial cursed with this layout, here's what:

• You gut the kitchen and ancillary rooms, tear down the old addition, and construct a 25-foot-by-16-foot eat-in kitchen that opens up to a 20-foot-by-18-foot family room, adding only 200 square feet yet dramatically enhancing your space.

• Then you add architectural details to the family room, including a period-style fireplace and mantel with a raised hearth, and French doors with transoms that let in extra light and fresh air.

• That just leaves the humongous deck behind the house, which blocks any views you might have of your neighborhood in the Chicago suburb of Kenilworth. You bulldoze the structure and replace it with a bluestone patio and extensive landscaping.

• Then you take supreme advantage of the fact that your new chimney and fireplace are on the wall facing the yard--and build a friendly outdoor fireplace. Now that's getting s'more out of life.

Home fires burning A hulking deck and a snippet of driveway were replaced with bluestone paths and a patio with limestone steps ($20,000). Erecting a chimney and an indoor masonry fireplace ($25,000) on the family room's exterior wall inspired the idea to build an outdoor hearth too, for $5,000. "Now all our neighbors want outdoor fireplaces," says the mother of three who owns the home with her husband. Starting from scratch, though, would cost someone a good 20 grand, says their architect, Steve Jones.

Go with the flow Three custom cabinets ($6,500) that span the divide between kitchen and family room are outfitted with bookshelves and topped with polished concrete to match the kitchen's counters. The center cabinet, which can serve as a buffet, has steps on both sides for optimal family flow, and is positioned so no one could push back a dining chair and fall into the sunken family room.