Money-Saving Mom: How We Paid Cash for Our House
My husband and I were both blessed with parents who taught us the value of hard work and financial stewardship from the time we were young. We had both lived at home, worked, and saved as much as we could before we got married. So the money we had saved, coupled with money Jesse received when his mom died, allowed us to have $35,000 in cash and no debt going into our marriage. We earmarked this savings for a specific purpose: three years of law school for Jesse.
We were both committed to continuing to work and staying out of debt while Jesse was in law school. Already thrifty by nature, our self-imposed beans-and-rice law school budget pushed us to take frugality to a whole new level. In the process, we discovered dozens of ways to squeeze a dollar out of a dime, creatively maximize the mileage of our money, and even how to buy all our groceries and household products for only $35 per week.Our scrimping and pinching pennies paid off as Jesse graduated from law school in 2006—without any student loans or debt of any kind.
After law school, our income increased significantly, but we decided to continue to live simply and save up for an audacious goal: paying cash for our first home. Since we didn’t have any debt, we had a good income, and we lived in an area where housing prices are lower than in many parts of the country (it is possible to find a starter home for $100,000 to $110,000 in our area), we knew that this goal could be achieved—if we were willing to stay focused and persevere. We’d already experienced the amazing fruits of focused intensity during law school, so we were excited to set an even bigger goal to work toward.
We spent time discussing this goal and determined that we were willing to wait up to five years to buy a home. Because we didn’t have any debt and were able to live on quite a bit less than we were making, we calculated that if we continued to live simply and frugally, it would be possible to save for a house within five years. Even while paying rent, this would put us in a better position financially than we would be if we saved up for a down payment, got a fifteen-year mortgage, and paid it off in less than ten years.
Once we had the five-year timeframe in place, we researched and determined the lowest price we could likely buy a decent starter home for. We divided this number by sixty (since there are sixty months in five years), and came up with the amount we needed to save each month in order to buy a home in five years. This specific monthly savings goal made us accountable for how we were spending our money. We carefully considered every purchase and, much of the time, found a way to make do with what we already had or go without in order to throw more money toward our house savings goals.
We didn’t always hit our savings goal each month that first year. Life happened, cars broke down, and medical expenses came along, but we never lost sight of the goal. We sat down at the end of each month and had a Monthly Goal Accountability meeting to assess where we were and the progress we had made. Seeing the ground we were covering each month and how we were slowly inching toward our goal motivated us to continue driving an older car, packing lunches instead of eating out, shopping at thrift stores, using coupons, sticking with a $40-per-week grocery budget, and delaying all other purchases which could be put off. These little things might not seem like much on their own, but combined, they were giving us significant traction toward our goal.
Our Monthly Accountability Meetings fueled our drive. We came up with new ways to save and creative ways to add additional income streams. By the second year of saving, we were reaching and exceeding our goal every single month. And by the end of two and a half years, we purchased a home—debt-free.
It was an incredible feeling to work hard and reach our goal more than two years earlier than we’d hoped. We know beyond any shadow of a doubt that if we hadn’t set the goal in the first place, broken it down into bite-sized pieces, and then kept ourselves accountable by tracking our progress each month, we never would have been able to attain this huge goal in such a short amount of time.
