Thursday, June 7, 2012

#6:Getting Your Priorities Straight

EDIT: A funny thing just happened. My husband walked into our room and said, "I just read about those people who downsized to really small houses so that they could get rid of their mortgages. I can actually see us doing something like that." We're still trying to decide how drastically we're willing to change our lives. If we lived like that for even a few short years, we'd be able to stockpile some serious cash. It would open up the potential to pay for our eventual home outright and to use the small one as a rental cottage for residual income.

I think a lot of people do a lot of talking about prioritizing without realizing what it truly means. Here are my priorities:

 I think when you're married to someone in the military, you realize that you could lose them at any time. Not trying to be morbid or anything, but it does put things in perspective. Couple that with being told that we would most likely not be able to have kids of our own without medical intervention (long story, irresponsible doc) and it makes me really appreciate those three faces up there.

 Once you figure out what is really truly precious to you, it will save you so much time and money. Seriously. If you know what you want and you want it bad enough, chances are you'll make it happen. Of course, that means letting go of some material stuff. It also means taking a good hard look at what you really need vs. what you think you need. Here are a few things we "do without" that provide us with the greatest savings. These certainly wouldn't work for everyone, but they make it possible for us to live how we want to live, so it's worth it to us.

 1. We share a car. This is actually a huge money saver for us. You're probably thinking, "wow, I could never share a car with my spouse." I actually used to think the same thing. When we got married, "my" car became our car. We saved up over the next couple of years and last Christmas, my husband got me the SUV I'd had my eye on for a while. I was soooo excited. After 2 years, I finally had my own car again! But, then something funny happened; we stopped driving our first car. It literally started to grow moss. So, we sold it. There's no use paying for insurance and oil changes on a vehicle you aren't using. Granted, I stay at home and the husband telecommutes for the most part these days. (Another long story) We also live withing walking distance of 2 grocery stores and multiple restaurants. (And our marriage is pretty solid. I absolutely don't advocate giving up your wheels if it isn't!) But if you have multiple vehicles simply because it is the norm for American households, maybe it's time to rethink it. With an average cost of ownership at 8k per year, per car, that's a pretty significant chunk of change!

2. Shopping. Well, ok, obviously we shop. (And if you're shopping online, I have a couple of tips for you here.)What I mean is, we don't shop for fun or out of boredom. If I don't need a new cardigan, I don't go into Macy's. It is that simple. Shopping for fun or entertainment gets really expensive, really quick. Have you ever heard that most of us wear 20% of our wardrobe 80% of the time? Well, that was true for us. So we eliminated the other 80%. We buy what we need and wear what we buy. I must admit, this was really a tough one for me. I'm a girl and I love to shop. Was that redundant?! Our clothes do need replacing a bit more frequently since they see more wear, but it's still so much cheaper than keeping a closet stuffed to the brim with crap that isn't getting worn.

 Here it is. And, this is a shared closet. We have a medium size rubbermaid tub that holds our winter coats in the off season and a hanging bag for uniforms, but other than that, what you see is what we wear.

I really don't know how to put an exact dollar amount on how much we save by buying only the clothes we need, since I never really kept track of it before. I estimate, however, that the total annual saving is probably around 2k for the both of us.

 3. Here's the biggie: we have a small home. And by small, I mean that the 4 of us live in precisely 938 sqft. We're fortunate enough to have a really great floor plan that is super space efficient-no hallways in this house! As the kids get older, we'll likely get a bigger house. But it still isn't going to be monstrous. We save gobs of money on our mortgage and heating/cooling bills.  The next-biggest house we considered buying would have tacked an extra 400 bucks onto our mortgage alone. The worst heating bill we've ever had was $150 bucks, and it was super cold that month! We also had a newborn, so we were keeping the place extra toasty. From the people I've talked to, it seems that most of them have heating bills nearly double ours. And I can clean our house top to bottom in about an hour if I have to! Don't get me wrong, I am not knocking big houses. I daydream about them, actually. But, at the end of the day, our small house is more than adequate for right now. Yes, we could afford a larger home, but we'd really rather have the cash than the extra space. Again, I know this isn't practical for every family. But, if you're curious to see how a few families made ultra small space living work for them, click here. Some of these places are gorgeous as well as functional, too. I love this Texas cottage. And while this is a lot extreme for my tastes, this family traded in their home for a mortgage-free 320 sqft living space.Don't the words "mortgage free" sound magical, though?

Next up: meal planning

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