February 24, 2014

Cutting Housing Costs (Saving for a Dream, part 4)


It is time to return to my Budgeting and Saving for a Dream Series. If you haven't yet, check out part 1, part 2 and part 3.

So far we have talked about setting goals and setting a budget. Now it's time to talk about ways to actually start saving money, so that you have enough left over to put in a savings account. I started by writing a post on all the ways you could save and quickly realized that the post was going to be far too long for anyone to read in one sitting. So for the next couple of weeks I will have a series of posts lined up with tips on ways to save on everything from housing to entertainment.

As you read this week I would like everyone to remember to start small. Just pick a few new things that you don't already do. Once they become a normal part of you daily routine, gradually make a few more changes. We started off small as well, and over time we have reached a point where we are now able to save over 60% of our income.

So for this week we are going to start with tips on how to save on one of the most expensive items on most peoples' budget:

Housing

 

We currently spend nearly 20% of our income on rent. If you have a mortgage you almost certainly spend a large portion of your budget on direct housing costs as well. Here are a few ideas that you might consider to save costs. 
Photo by James R Gray at freerangestock.com
1. Own a Mortage-Free House- In an ideal world you would own a small house mortgage-free so that you aren't paying rent or interest. However, most people don't have that kind of money lying around to just go out and buy a house, so you usually have to at least take a few years to reach this point...but it is a good goal to work towards, and the faster the better! If you already have a mortgage, focus on paying it off faster. Perhaps switch to bi-weekly rather than monthly payments, and try to always pay off a little extra with each check. As always I would recommend reading Mortgage Free!: Innovative Strategies for Debt-Free Home Ownership.
Our Story: This is our ultimate goal...but we won't get there until at least 2018... Read about how we plan to reach this goal here and follow our progress here.

 2. Be Willing to Downsize- Do you really need a 3 bedroom, 3 bath house? Over time Americans have come to believe that they need larger and larger houses to be happy. However larger houses not only cost more money to buy, but also take more investment in upkeep and utilities. We also tend to feel the need to fill larger houses with more stuff. You may not want to go to this extreme, but check out the Tiny House Blog for inspiration to go smaller. (And then just think about all the time you could save without having to clean those extra rooms.)
Our Story: Perhaps my perspective will change, but over the last few moves we have lived in progressively smaller spaces. We started out in an almost 795 sq. ft. apartment and now we are now down to a 565 sq. ft. apartment. As we start a family we will probably want a little more space, but I don't want much bigger... I really hate cleaning as it is!
Photo by Adamophoto at freerangestock.com

3. Embrace DIY- You could certainly do more harm than good if you start doing your own plumbing or electrical work without any background knowledge, but over time these types of skills will certainly pay off. Whether it is taking care of simple maintenance yourself, finding a good deal on a fixer-upper, or maybe even building your own house, there could be many opportunities to save if you have the required skills. So consider taking a few classes at the local community college, getting some hands on experience by volunteering with Habitat for Humanity, or finding a mentor to teach you. And then once you get started, take the time to do the job right the first time, ask questions, and remember that having the right tool will usually pay off in time. Cultivate Simple had a great episode on home improvement a few weeks ago.
Our Story: We are slowly working on building up our skills, but this is one that we will probably continue to develop for many years... One of our goals for this year is to really start working on this area. Nathan plans to use some of his remaining AmeriCorps Educational Award to take some classes and I am hoping to begin volunteering with Habitat for Humanity's Women's Build program.
4. Consider Apartment Living- If you have to rent, you should try to find the cheapest rent for the shortest time possible, until you have the money to buy. This usually means living in an apartment.
Our Story: We have lived in several apartments over the years, and I will admit that sometimes they can be somewhat soul-sucking (especially the larger corporate complexes), but keep looking! There are certainly nice ones available. We were admittedly lucky, but I am loving living in our apartment at Kailash Ecovillage. The rent is reasonable and the community is awesome!
Living in your landlord's yard can have it's perks... such as abundant garden space!

5. Consider Non-Traditional Living Arrangements- These options usually require a little more flexibility (and sometimes hassle/sacrifice) but they can also yield huge savings. Try renting a room,  mother-in-law studio, or guest house. Consider roommates, or renting out extra space. Take a live-in nanny job. You could even concider living in an RV for awhile like this family. Or maybe even find a caretaking opportunity through the Caretaker Gazette.
Our Story: Before moving to Kailash we tried living in a mother-in-law studio behind our landlord's house. It worked out pretty well (especially since we were able to have a lovely garden that year), but ultimately the rent was too high even there...
Do you have any ways that you have cut your housing costs? Be sure to share your tips in the comments!

While many of these suggestions require some flexibility in your living arrangements, (which are certainly easier before you start a family, etc.), be sure to visit again on Wednesday for some suggestions that will be helpful no matter where you are in your life. Coming up next.... how to save on: Utilities.
Note: This post contains affiliate links. If you choose to purchase any of the products linked in this post I will receive a small commission. Purchasing these products through one of the links in this post will not cost you any additional money and the money earned through affiliate links is used to cover the costs of maintaining this blog. Rest assured that I only link to products that I have used and recommend.

(This post was shared at the Homestead Barn Hop, Natural Living MondayMostly Homemade Mondays, the Backyard Farming Connection Hop, Tuesday Greens, Tuesdays with a Twist, the Down Home Hop, Simple Lives Thursday, the Home Acre Hop, Old Fashioned Fridays, 104 Homestead Hop, and the Maple Hill Hop) 

3 comments:

  1. Great series! Thanks for the good advice! You are so young and yet so wise! One day you'll be glad you chose to live this way! Blessings from Bama!

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  2. Thanks for the kind words Felecia!

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  3. Great tips. Smaller houses always have so much more charm and appeal. And less to clean is a huge bonus! Thanks for sharing on The Maple Hill Hop!

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