Skip to content

FINALLY DEBT FREE!

It’s official, I can finally say that I am debt-free.

It’s a story that goes way back and it was a long time in coming.  I owe it to reading blogs about minimalism that spurred me to action.  I am a regular reader of minimalist blogs.

Five years ago, I was living in a condo and decided to buy a fixer-upper house.  My thought process was that it was my last chance to get into a house and have it paid for by the time I retired.  I am now 53, so at 48 years old I set about fixing up a house that needed a lot of cosmetic work.

Over the past 5 years I painstakingly cleaned, restored, and decorated a 1957 house that had great potential.  I purchased it from an estate.  It had been sitting on the market for over 6 months.  By the time I saw the house, the realtor had convinced the owners to pull up the old 70’s orange and green shag carpet, so I saw that the hardwoods were in good condition.  I have a friend that called it my “creepy 50’s” house.

I did something that most financial advisors would tell someone NOT to do.  I got 100% financing for the house.  I got approved for a conventional mortgage for eighty percent of the purchase price and I also got a second mortgage for the 20% down.  At the time, I had a 15 year mortgage on my condo but my payment was low enough that I could rent it out and clear enough every month for upkeep and any maintenance costs that came along.  I rented it out to a dear friend who eventually purchased the condo from me while I was living in my fixer-upper house.  I didn’t make any profit on the condo, but I did get my money back that I had into the condo.  I also owned a rental house in the next town an hour away.  I knew going into the house purchase that I intended to sell the rental house and put the money down on my fixer-upper house.  So, that’s exactly what I did.  I put the rental house up for sale almost immediately.  It sold in about 30 days, so I used the proceeds from that sale to pay off my second mortgage on my fixer-upper.

As you can see, I took some risk when I purchased my fixer, but it worked out well financially. Thank Goodness!  That however, is not the end my story.

After I sold my condo, I decided to use those proceeds to pay down my 1st mortgage on my house.  By now, it was becoming my house, instead of my fixer-upper house.  I took almost all my vacation time to work on the house.  My financial position was pretty good by the 5th year of owning the house since I had put proceeds from the condo sale and rental house sale into the house.  I was at the point of being able to pay off my house in about 3 years if I really tried.

But it was about that time that I started reading blogs about minimalism and also started reading financial blogs on the internet such as the ones listed in my blogroll.  I came to realize that there could be a better way to live my life that having a house (and all the upkeep that goes with it) going into retirement.  Since I’m 53 now, I started thinking about what I wanted to do with my life and whether having a house was really what I wanted or needed.

So one day, I decided to put my house on the market to see if it would sell.  I had done a lot of work to make the house show very well.  And indeed, when I saw the pictures that the realtor posted on the internet, even I was impressed!  The pictures made the house look incredible.  It’s funny how I didn’t realize how good it looked until I saw the pictures.  The house sold within a week!  Yeah, I know, did I under-price it?  I had discussed what to price the house with my realtor in length before even placing it on the market.  I honestly believe I just got lucky that the right buyer came along because, just like everywhere in the country, houses around here are staying on the market longer than they have in the past.

Now I just had to find a place to live or I would be homeless within a matter of a month!

I had been dreaming of living a more minimalist lifestyle so one of the things I wanted was a place that I could pay off with the proceeds from selling my house and I also wanted to live where there are numerous restaurants, clubs, and stores that I could walk to instead of driving everywhere.  I found just the condo that I was looking for in an area of town that offers exactly what I want.  So I chose my condo, not only for its “walkability” but also for its low price.

It was a hard move.  If you’ve ever downsized you know exactly what I mean by a “hard move”.  However, it all worked out.  I had to put some moving expenses on my credit card and I will have it paid off Friday, October 14,2011.  Therefore, this is the day I will celebrate as the day I became DEBT FREE!

Posted 15 October 2011 † Norman § Minimalism ‡ Comments (0) °

Quote of the Week

Money will buy you a pretty good dog, but it won’t buy you the wag of its tail. – Unknown

Posted 18 February 2011 † Norman § Quotes ‡ Comments (0) °

DECORATING ON A BUDGET

Shop Estate Sales.

Best time to shop an estate sale is on the last weekend when the merchandise is half-off.  Yes, you might miss some great items this way, but remember, you are looking for bargains.  Or, you might go the first day and see what is available.  If you find something that is an incredible price, go for it.  Look around to see if there’s some things you might hold out til the last day.  Something that you could possible live without.  I prefer going on the last couple days of the sale while it’s 50% off, then I don’t know what I’ve missed.

Shop garage sales.

When you find something you like, pick it up and walk around with it while you are looking and think about the item.  Is it something that will work well with your decor?  Is it a good price?  Always offer less than its priced.  If they say its their bottom price, that’s ok.  No harm in asking is there?  If something is truely a bargain, buy it.  I have a few pieces that I can switch out later that I keep in storage places around the house.

Shop Clearance Sales at Department Stores.

The other day, I saw some placemats for my dining room table that I really liked.  They were on clearance for $1.00 each.  When I got up to the register, it was an additional 50% off all clearance items, so I got them for 50 cents each which was an incredible bargain.  I then went back and purchased two outdoor tables for the same 50% off the clearance price.  It gave me such a high!  It was like winning the lottery!

Look Online for Bargains.

Shop Online stores that specialize in what you want.  Sometimes they will have the best prices.  For example, I shopped at blinds.com for all my faux wood blinds for my entire house.  I still spent a bit of money on them, but they were priced much lower than the chain stores around town.  Also, shop Craigslist.  I have modern furniture in my house and I found a dresser and chest of drawers that were 60s modern on Craigslist for an incredible price.  The folks were moving and just wanted to get rid of them.

Shop at antique stores and antique malls.

Since my house is modern, I can find 50s and 60s modern pieces at these antique malls.  One of my best modern art pieces in my living room, I found for $17 at an antique mall that was mixed in with other old stuff.  I had to really “see” it for what it was because it was surrounded by things that didn’t go well with it.  Train your eye to look for things that will fit in your house even if they aren’t displayed well at the mall booth.

Friends.

I love it when friends give me things.  They know I’m always looking for a bargain.  I’m not known as the “Coupon King” for nothing ya know!  Believe it or not, I am probably the one giving away the most things because I’m always finding incredible bargains and it doesn’t bother me a bit to give something away that a friend really loves.

Use what you already have.

As I stated earlier, I keep things I like in storage places around my house when I’m not using the item to decorate with.  Sometimes when I feel like a change, I will look at things I already have and switch things up a bit.  I’ve been known to take things from different rooms in the house and switch it up.  Its amazing what a difference a change can make.  I have a couple of lamps in my living room that I got from an estate sale years ago and it occured to me to change the lamp shades with ones that were on my bedroom lamps.  Man, the difference it made was incredible.  The black lamp shades really brought out the art-deco features of the living room lamps.  Of course, one change can lead to another, so now I’m on the lookout for some modern lamps for my bedroom.  But that’s half the fun, looking for a bargain.

Last but not least.

Don’t be afraid to pay full-price for something that you know you will treasure for a long time and it really works with your decor.  Sometimes even “The Coupon King” will actually pay full-price for something.

I would love to hear more ways to decorate on a budget.  So let me hear from YOU!

Posted 05 February 2011 † Norman § Being Frugal ‡ Comments (2) °

Quote of the Week

“One of the difficult tasks in this world is to convince some people that even a bargain costs money.” – Edgar Howe

Posted 09 January 2011 † Norman § Quotes ‡ Comments (0) °

Money – The motivation you need to quit smoking

Need motivation to quit smoking?  Think about the money you could save if you would quit smoking.

Lets say you smoke a pack a day.  I think cigarettes cost close to $6 a pack.  $6 x 7 days is $42 per week.  So, that would mean a savings per year of approximately $2,184.  Wow.

Its almost hard to believe that it cost that much to smoke.  Being an ex-smoker myself, I can speak with authority when I say…I know its really hard to stop.  I’ve been an ex-smoker for about 25 years.  So, I guess one way to look at it, I’ve saved about $54,600 by not smoking all these years.  Now, it doesn’t mean I’ve saved that much in addition to what I’ve saved for retirement.  But, it does mean I’ve had that money available to me to save.

What if you quit smoking today and started saving the amount you spend on cigarettes?  It would mean that you could put $2,000 into an IRA every year instead of giving your money to someone else, just to have it go up in smoke.

I’m not even going to go into the health cost associated with smoking because it is very hard to quantify, but needless to say, it could make a difference in the amount that you spend on healthcare in your later years.

With 2010 coming to a close, think about starting 2011 out smoke-free and save the money you would have spent on cigarettes to do whatever you want with at the end of 2011.  Save it in a separate account during 2011.  All year long during 2011 you can think about what you will do with the money to keep you motivated.  You could even take a nice vacation, save the money for retirement, or buy yourself a new wardrobe.  Just think how good you will feel at the end of next year!  Go for it!

Posted 10 December 2010 † Norman § Being Frugal ‡ Comments (0) °

Netflix is raising prices

Netflix is raising their monthly price.  It will now cost $9.99 for the unlimited, one DVD at a time plan.  It includes all the streaming movies that you care to watch.  What is interesting is that they are also going to offer a $7.99 a month plan for streaming movies only.  That actually makes a lot of sense.  Since I started Netflix about a year ago and bought the Roku box to play some movies instantly, I have watched many more movies instantly than I have by DVD.

Apparently, they will be investing more money for the rights to show more movies instantly and less money investing in DVDs. 

Now, with a forward thinking company like Netflix, why didn’t I buy their stock a while back?  Duh.  Another opportunity missed!

Their selection of streaming movies has been somewhat limited.  Maybe this will mean they will have more recent movies to watch instantly.  I hope so.

If you haven’t gotten Netflix yet, I highly recommend it.  Not only is it much cheaper than cable TV, I love the fact that you can sit down when you want and watch something when you want.  And the best part -  NO COMMERICALS!

Posted 22 November 2010 † Norman § Being Frugal ‡ Comments (0) °

The Time to Start Saving is NOW

This is for those people who keep procrastinating about SAVINGS.

The first thing you need to do is determine how much you could set aside each paycheck.  How much money could you save?  What?  You say you need ALL your paycheck to make ends meet?  Think again.  This would be the amount above and beyond your living expenses.  Do you have an amount in mind that you think you could set aside?  There is never a better time than NOW to start a savings account or to start adding to your savings account that is collecting cobwebs.

Automatic savings

One of the best ways to save on a regular long-term basis is to put your savings on automatic.  See if your payroll department will let you assign part of your paycheck to go into your savings account every time you get paid.  They will need the account number and the routing number for the account.  You can find this out by talking to someone at your bank.  They can help you get what you need.  Decide how much you can set aside from each paycheck and do it.  Do not wait.  You’ve probably been intending to start saving for a long time and just haven’t taken the steps to make it happen.  NOW is the time to make it happen.  Another way to automate your savings is to ask the bank to automatically withdraw a certain amount from your checking to deposit in your savings account at that same bank on set days of the month.

Are you man (or woman) enough?

I was listening to a talk-radio show the other day when a caller mentioned that he wanted to stop smoking.  Even though it was a political talk show, I was impressed that the host took the time and stopped what he was talking about and encouraged the caller to stop smoking NOW.  He asked him about his family and the caller said he had a couple of small girls.  The host asked him if he was man enough to stop smoking NOW for his family’s sake?  The caller was calling from his cell phone and he was in his car.  The host asked him to pull over and throw away the cigarettes he had in his possession right NOW.  The host kept asking the man over and over again, “Are you man enough?”

The same can be applied to saving for your future and that of your family.  Are you man enough to start saving right now?  Do you really need to keep spending ALL your money?

Gradually accumulate a tidy sum.

Think about it.  Even if you start saving with $25 twice a month, that’s $600.00 per year!  Once you start saving on a regular basis you will get into the habit of saving.  You will also start to feel good about how your balance is growing by the month and want to save even more.  The bigger it grows, the more you will want it to get even bigger.

Retirement Savings

If you are 25 years old and haven’t started saving for retirement yet, you better get started today because 40 years is how long you have, and its not as long as you think.  Start participating in your 401k or other retirement vehicle at work if you don’t already.  If your employer matches a certain percent then make sure you at least put that percentage in your employer plan.  Investing is a topic for another discussion.  Today, the main thing is to start saving.

Hopefully, you will be motivated to start saving.  There is no better time than today to start doing it.  You will be able to pay cash for your next vacation instead of charging it.  You will be able to handle the next emergency that comes along.  You will also be able to retire someday.  Think of the possibilities!

Posted 14 November 2010 † Norman § Savings goals ‡ Comments (0) °

Making Frugal Choices

I’ve found that living frugally is about making the right choices in the things we buy or not buy.  Every time we go to any store, whether it be a store for groceries, appliances, hardware, or clothes, we make choice after choice after choice.  Think about it the next time you go to the grocery or hardware store and be conscience of the number of choices you are making in just one store.

1.  Always buy on sale.

It pays to wait for a sale.  Is there ever a week that you don’t see a sale ad or a TV advertisement that shows something on sale?  It just makes sense to wait for something to go on sale.  Yes, you will have to wait a bit sometimes, but patience is a virtue.  I personally like the thrill of the hunt.  Sometimes I will wait weeks or months before making a major purchase.  During this time, I will search stores and weekly ads so I have a good feel for what a good price should be for the item I’m looking for.

2.  Don’t get in a hurry to buy technology.

Don’t buy when it first comes out.  In a few years you can get the same item for a fraction of the price.  For instance, I purchased a flat-screen TV a couple of years ago.  I waited until the price had come down substantially before I purchased.  What’s funny is, if I had waited a couple more years I could have gotten the same TV for even less money.

3.  Look for bargains at the grocery store.

Buy generic or name-brands when they are on sale.  Look at the grocery ad for the store you shop at.  Also while grocery shopping, keep your eyes open for items marked down or on sale.  Compare prices.  If you shop at the same grocery store like I do, you will get faster at comparing prices as you get to know your own store.  You can also look through the paper to get coupons on the items you already purchase or a new product you wish to try.  But don’t get too gung-ho about coupons.  They can entice you to buy something more expensive you wouldn’t have bought otherwise.

4.  Don’t always go for the cheapest. 

Sometimes being frugal means purchasing the best quality item you can find.  For instance, a good pair of boots can be costly but it’s worth buying quality so it can last for years rather than having to replace them every season.  Sometimes this is a hard one for us FRUGALISTICS!  I tend to gravitate to the cheapest item and have to remind myself that this is an item that I expect to have for a very long time and its worth buying quality.

5.  Buy used instead of new when you can. 

Shop garage sales.  Shop consignment stores.  Shop estate sales.  Attend auctions in person and online.  You would be surprised what can be found at garage sales in certain neighborhoods.  One of my best purchases was a pair of very high quality boots that I got at a garage sale for 10 dollars.  They were my size and looked nearly new.  I talked to the guy who was having the sale and he said that they just weren’t the right size for his foot.  I tried them on and paid the man.  I’ve been wearing those same boots for 10 winter seasons.  That’s a dollar a year!  If you are like me, it’s the thrill of the hunt that can really be exciting.  Its like I’ve won the lottery when I find a really great bargain and have been known to talk about it for years.  (Sorry about that, please forgive me.)

6.  Minimalism and Living frugally go together like peanut butter and chocolate.

The saying “less is more” is very true sometimes.  I decided to decorate my house in a minimalist-modern design when I moved here about 3 years ago.  Most all of my furnishings have come from garage sales or estate sales.  It has taken 3 years to get it fully furnished, but it has been well worth it.  I don’t have numerous knick-knacks.  Instead I’ve tried to purchase a decorating item that has a big impact.  My bedroom dressers, desk, dining room set and all end tables have come from garage sales or estate sales.

Is it any wonder we have a hard time remaining frugal in our shopping choices with all the fantastic things that there are to buy.  But, using frugal principles, we can be true to our frugal selves and still have nice places to live and nice clothes in our closets.

Posted 31 October 2010 † Norman § Being Frugal ‡ Comments (0) °

Keeping Up Appearances

 When you gotta have what everyone else has…What do you call that?

The old saying “keeping up with the Jones’” comes to mind. How is it that our self esteem is measured by how much stuff we have? I was watching a show on hoarders the other day and was amazed by how much hoarders hang on to what they have like it was a part of them. The hoarder could pick up just one little item and tell a story about it. It’s as if their life didn’t have any meaning without their “things” and their sense of self-worth was tied to the stuff that surrounded them. Have hoarders been around since day-one or is it a by-product of our commercialization of our society?

How is that much different than someone who has to have the latest tech toy that comes out so that he fits in with his friends and can talk about all the latest craze with them. Maybe there is something to calling it a craze. I remember when cabbage patch dolls were all the rage. Women would stand in line for hours and spend triple digits on a cabbage patch doll for their child so they could have the latest thing that everyone else had. Do you think they were buying the doll for the child or for themselves? Were they actually buying it so they could tell their friends that their child had one and what kind it was and how wonderful it was? Of course the difference between someone who buys the latest “thing” is different from a hoarder because they actually get rid of it when its no longer the latest “thing”.

Now, don’t get me wrong. There are so many things that we are bombarded with on a daily basis. The commercials tell us how wonderful the product is and how wonderful it will make us feel. There are certain things that we buy that we actually end up keeping and always treasure. But what is the percentage of the total things we buy that we actually feel that way about? Probably a very small percentage. Some things we buy, we look at it after a little while and think…Why the hell did I ever buy that!

How do we fight back against the constant barrage of new offerings? Do we just go cold turkey and stop buying altogether and be happy with what we have? It can be quite the challenge even for someone who is naturally frugal to only buy things that we can use for a long time and is actually useful to us in our daily lives. I’ve purchased some things that I thought I really needed or wanted at the time and it ended up in a closet never to see the light of day again.

I think the answer might be in using conscience spending. This is where you think about a purchase for awhile before jumping in. Instead of impulse buying, think about it a few days before you make the purchase. This is something to keep in mind with the Christmas season approaching. Another idea I had, instead of buying something for somebody, why not “do” something for them instead. There is a single mom that I know that had a hard time finishing a room that she started painting. She hasn’t gotten around to finish the painting, let alone decorating it. So I decided to give her a Christmas present that she could really use. I’ve already told her what she is getting from me for Christmas and she was absolutely delighted! I am going to finish the painting and help her to decorate it just in time for Christmas. It will be something that she can enjoy for a long time without having something else to dust and we might just spend some time together that will bring lasting memories. How many times have you gotten something for Christmas and a few month’s later you can’t remember who gave it to you. I know she will remember who helped her finish painting and decorating her room.

Something to think about.

Posted 26 October 2010 † Norman § Being Frugal § Minimalism § Uncategorized ‡ Comments (0) °

Consumer Credit Counseling Service (CCCS)

Credit Counseling – Does it work?

Paying off debt once you have built up substantial credit card debt is a daunting task to say the least.  It is probably one of the hardest things you will ever do in your life, but one that is extremely rewarding.  Think back to when you were younger and how you started using credit cards.  You probably started with one credit card and it felt good to be able to charge something that you had been wanting.  It gave you a lifestyle where you could have all the things you wanted right now.  You could go out to eat and not worry about the cost, you could buy the clothes you wanted, and you could go on trips with your friends when they wanted to go.  You didn’t have to come up with the money out of your measly little paycheck.

Then when you got your credit card bill in the mail, it showed how much was due and you thought…I can handle this!  Then what happened?  Maybe you had to have some work done on your car so you decided to put that on your card since you had just paid your credit card bill.  Then came the next month’s bill and you were a little shocked at how much they charged in interest but you figured you could handle the payment that was due so you paid it and shrugged it off. Then another credit card offer came in the mail and you decided to go ahead and get another one since the first one was getting close to its limit and the snowball began.

How you got into credit card debt varies from person to person and maybe it happened due to circumstances beyond your control.  However it happened, you find yourself in a situation now that is beyond your ability to handle the payments due on your credit cards.  You also look at the bill and realize that you’ll be 90 by the time you get it all paid off.

What do you do?  Where can you go?  Do you borrow money from family or friends?  Get a part-time job?  Stick your head in the sand and wish it would go away?  But a funny thing happens.  It starts to eat at you whether you realize it or not.  Life seems more stressful now.  You can’t sleep as well as you once did before you got yourself into this mess.  No matter how much money we make, reliance on credit cards can get us into trouble.

A program that has been around for over 40 years has been Consumer Credit Counseling Service (CCCS).  Lets take a look at what they do and whether it can work for you to get your debt under control.

Most credit counseling services are non-profit community organizations.  Most are also 501(c)(3) organizations meaning that they are tax exempt.  They qualify for the tax-exempt status because of the education component of credit counseling.  The ones that are members of the National Foundation for Credit Counseling (NFCC) have requirements that they must meet to be a part of the national organization.  So, it is important to find a CCCS agency that is a member of the NFCC so that you know they follow certain requirements that make them the premier credit counseling association.  Go to www.nfcc.org to find an agency near you.

Most CCCS agencies do not charge for credit and budget counseling but most charge a monthly fee if you decide to go on a debt management plan (DMP).  A DMP is a plan where you pay the agency one amount that covers all your credit card payments.  The agency deposits your funds into your account with that agency and the agency disburses your funds to your credit card companies on a monthly basis.  The benefits for the consumer are two-fold.  The consumer has one payment to make that covers all their credit card debts instead of several payments being made to each individual credit card.  Also, most major credit card companies will lower the interest rate they are charging substantially and will stop over-limit fees and late charges.  Most agencies charge a monthly fee of $25 to $30 per month which is substantially less than what the consumer saves in credit card interest and fees by participating in a DMP.

At their recent national convention in Minneapolis, the National Foundation for Credit Counseling honored a couple who had paid off over six-figures in credit card debt.  Friends and family had urged them to declare bankruptcy or to try to settle their debt but they persevered and went on a debt management program and in 5 years paid off their entire debt that they owed.  It is a truly inspirational story.

Does credit counseling work for everyone?  No.  It depends on the individual and their circumstances.  But if you find yourself in way over your head, credit counseling might help and there is no charge to find out if it can help you so you have nothing to lose by learning more about it.

Posted 17 October 2010 † Norman § Debt ‡ Comments (0) °