We had planned on having our tiny house chat last Monday, but our guest had a family emergency and we had to postpone to this coming Monday. We are going to be talking about building a business in your tiny house, so that you can leave behind your 9 to 5 and live life on your own terms. We will also be talking about how this is a vehicle for you to follow your passions in life while still earning a living.
We have two amazing guest: Danny Dover and Kacie Erikson
Danny is from Life Listed and has made a living for himself, independent of a location and travels the world while working remotely. He is best know for his journey of pursuing his bucket list. I recently found his TED Talk and I knew we had to get him for this chat!
Kacie is the perfect guest because that is exactly what her business is AND she’s building a tiny house! Check out her background over at www.ikilledthejoneses.com and her tiny house at www.treadingtiny.com.
As of late I have been looking into what it costs me to live the life I lead. I generally don’t spend a lot of money, a lot less than most of my peers, but I still don’t think where I am at with my spending is good enough. Then I went over to Early Retirement Extreme where I reread some of their articles and I was very impressed on how little Jacob lives on…. $8,000 a year!
Come this summer I will have a yearly cost of living of $15,000. Like Jacob, I am single with no kids, which inherently drops my costs significantly. Here is a general summary of my costs:
- Food (grocery and eating out): $350
- Utilities (power, water, gas, internet): $150
- Car (savings): $200
- Spending/Entertainment: $200
- Insurance (employee portion): $45
Monthly Total: $1175
So obviously I am almost double the cost of Jacob’s spending, but I have elected for some things that he’d label as “luxuries”. Namely a car, eating out and I also have a much more comprehensive insurance package. For the things not included: taxes and car insurance, that is where I get the difference between monthly ($1175 x 12 months = $14,100) and yearly of $15k.
For retirement savings, paying off student loans etc I make a lot more than my costs; so right now I focus on double and triple paying my student loans each month. Once that is gone I will be shifting that focus to building my retirement account.
Part of what ERE points out is if you can drastically minimize your monthly costs, you can retire much earlier than most. It certainly is a balance of living comfortably vs saving so much that you don’t enjoy it, but I think living comfortably is much less than most people think.
- How little can you live on (what does that cover)?
- What are things you gave up or wish you could give up?
A while ago I wrote a post on being “weird” which was a huge hit and you can check it out here. I was thinking about what it means to be an average American and started researching some of the numbers. In particular I was thinking about how a typical American would compare to someone who lived in a Tiny House. Tomorrow I will write a post on what the average Tiny House person is like to compare.
Recently I have hit a snag in my quest for a Tiny House, recently I have had to take a small hit in income and at the same time, I have decided to get more aggressive with goal setting in my financials. The ultimate goal for me is to have all of my student loan and my car loan paid off, save to pay cash for my next car and build my house without taking a loan if I can help it. A tall order for anyone, but for a single income worker just beginning their career in a shaky economy, it is especially hard.
At this point I have significantly cut my spending. I dropped my cable tv, I have arranged to work at home for part of the time to save gas, and the biggest change is I am now house sitting long term (hoping to continue) which saves me $900 a month.
My student loan has 7 more years left on it, but I am working to double pay by the end of next year and then triple pay after that, this will cut the time to about 2.5-3 years. But this timeline was longer than I had initially hoped.
In the end it will be worth it, I will have a home and a car that I own outright, no debt hanging over my head, this coupled with a lean lifestyle and all my income going to the bank. I can’t wait for this journey that I started 3 years ago to finally be realized. So for those of you on a similar journey, know you don’t tread this path alone, good luck.
I found this infographic on the true cost of owning a traditional home and thought I would share it with you.
Click image for larger version