Here is the continuation of the book Making it Stretch. For those of you just arriving, I have posted 3 chapters already. I’m doing April Camp NaNoWriMo and writing a small book for the challenge. I decided to post it as I write it.
My wonderful editor is not cleaning up my sloppy work so just enjoy the writing and ignore the grammatical errors and punctuation.
Downsizing your life
This is not the time to move or sell…anything or anywhere. But when life returns to a semi-normal state, it may be time for millions to rethink the size and price of their homes and cars.
We are not rich folk. We are blue-collar working folk. So, the budget is a beer budget, a discounted beer on sale and our taste must accommodate this budget so we don’t become delusional and unhappy.
I study this topic, watch the little documentaries around the 2008 recession and other depressions and recessions. I dive deep into why people fail with their finances and fortunes. Why is bankruptcy and foreclosure such a common thing? Why are so many in debt? Why are Americans still living paycheck to paycheck?
It all comes down to poor budgeting and living way above one’s means.
It seems we didn’t learn that well in 2008 because here we are with the housing market back at level “outrageous” and rents are out of control as well. Housing cost and rent is unrealistic. But people are buying the houses and paying the rent despite the cost and encouraging the prices to go up and up.
On top of paying too much for a house the family spends little time in (because it takes two full incomes to pay for it), this family has credit card debt and a fairly new or leased car they are paying another hefty amount for monthly.
70% of our population is addicted to some kind of drug or alcohol according to words of Sadhguru and we can see why right? Who can live with all that money stress, too much work and commuting and then all the precious money and energy thrown at a house that will be impossible to pay off?
What most people need is to adjust what they “want”, comparing what others have and what they can afford. Stop comparing yourself to others. Stop trying to keep up. The people we try to keep up with are just as stressed and miserable.
We bought an ugly house in an ok neighborhood. We fixed it up with our hands and paid a tiny mortgage for three years. Eventually, we found a hundred-year-old house in our dream mountain town. The seller wanted too much as this market is encouraging price gauging. I negotiated down to what I found to be reasonable. It is a price rarely found these days. Our mortgage is comparable to what we used to pay in rent long ago when rents were fair. Our first little house is now a rental and making us a small profit.
That is how you do it, boys and girls.
You probably want to slap me right now. Go ahead…in your mind, give that slap. But then start reconsidering your life. As Albert Eisenstein said…you can’t fix a problem with the same thinking that made the problem. Or something close to that. It’s time to try new things. Very new things. Think outside the box, take risk…smart risks.
Get rid of that car and get a used car for cash or get a bike or moped if work is close by. Walk and not get anything. If work is close. If not, start commuting on a train or bus. See if you could live without a car. Seriously. Could you live without a car? If you are in the country it might be tricky, but I lived deep in the country in my late 20’s and had no car for a couple years and commuted to the city. I walked or bused everywhere. If you are in suburbia out and away from things, probably not. If you are in a city you have no excuse. Life is actually easier without a car in those crowded cities. Walk, bike, skateboard (yes, even if you are 50), rollerblade, take a cart to go shopping, put a basket on the bike. The boys and I used to drag a cart/wagon with us to the parks and stores. We would load it up with groceries, library books, picnics, or a tired boy.
Get rid of that large house. Buy a small cottage in town and fix it up or get a handyman to help make it charming. The neighborhood might improve soon, as more people are forced to downsize. You don’t have to live there forever but a small mortgage will be a joy and then you can get out of debt and save a huge amount easily and quickly.
Get a nonprofit credit counseling agency to consolidate your debt and work with the credit card companies to lower your interest rates. They will take care of everything and you can get busy painting your new little house and putting in a garden.
Have garage sales and sell your stuff on Craigslist or eBay. Sell everything but the things you really love and can help you set up a mini homestead elsewhere.
Find a way to afford your life again.
We have no debt and sleep well. We pay bills with ease and still save mass amounts of money a month. Yes, we have two houses thus two mortgages. Both our mortgages total to less than the average Americans one mortgage. And because the rental house has such a tiny mortgage we were able to charge a low rent and still make a profit.
You may be thinking, hey lady, I’m not moving into a bad neighborhood! I don’t blame you. Our neighborhood was not bad or unsafe. It cleaned up a lot after the neighbors witnessed all our painting and gardening. Buuuttt…sigh, there was that one problem house or units that made life unsavory at times. There is always that slum lord or “that house”, even in the nicest neighborhoods you have that one house that sets the teeth on edge. You can improve your area and hope others follow. You can make complaints to cops, the city, the code enforcement, the landlord himself. Sometimes the bad parts just move one when they don’t fit in anymore.
Our slum lord improved some things and the tenants weren’t bad people, they just didn’t have the tools to work through issues in a healthy manner and they chose to sit about smoking pot instead of perhaps reading books or getting educations…they did start fixing up their area though and they didn’t bother other people. But we were in a town that was a mix of old and improved. It hadn’t fully evolved yet.
We also had a lot of good neighbors and streets and parks. We liked walking around and many a neighbor would lean on my picket fence out front and chat with me as I gardened.
Now we live in an area that is a dream come true for me. I’m so happy and at peace that I sleep in until 7:30 and after 8:00 am daily, which is a miracle. At the old house, I woke up and started my days at God awful hours such as 2:30 or 3:ish am. I didn’t sleep well there. But it was worth it and we were very happy those three years…it just wasn’t our forever home.
If we hadn’t purchased the little, cheap home and lived with such frugality and thrift for those years, learning to save the last year like pros, we would not live in our dream town today. We couldn’t have afforded this old home or kept the first one as a rental and investment.
What I see is most people buy big and expensive homes the first time and then are struggling just to pay that mortgage. Selling might mean they lose money. It would be decades before and if they ever have a profit on the house. They are trapped.
Some of you may be in this situation. So, what now? You may have to cut your loses. After this epidemic, a recession of some sort is sure to spread through the valley and it will be some time before the market picks up…if it ever does again.
Some people will have to foreclose eventually. Or do a short sale.
But then you can start all over and do things differently. Rent small and cheap. Buy a small fixer-upper. Buy a trailer out in the country and make it as charming as any cottage and grow food gardens all around it. Relocate to a less expensive state or country. I have a feeling many people will leave California as times become more challenging.
Be creative, think outside the box. Buy a home that cost very little so you don’t have to work so much, you can have a simple job and get by, and you have plenty of time to enjoy your life.