Inside: How I paid off our mortgage in 5 years. 12 ways I cut costs to the bone that anyone can do.
Guest post by Hope Ware from Under The Median.
After four long years of house hunting, my husband and I bought our first home in 1992. It was a 1930, two-bedroom bungalow and we were deliriously happy. We paid 20% down and took out a 15-year mortgage.We were the second owners and the house remained in absolutely original condition.
We looked at the contract, astounded by amount of interest that we would pay at the end of the term. It lit a fire in our bones! We became determined to pay the mortgage off as quickly as possible. Although we were no novices in the art of stretching a dollar, we quickly realized that we needed to increase our level of financial acuity from that of "Padawan" to "Master Jedi" in a hurry!
We wanted to be debt-free more than we desired anything else in the world, embracing delayed gratification with every sinew of our bodies. We grabbed on to that great, big, seemingly unattainable goal like a dog hanging on to a bone! Most importantly, together, we crafted a master plan of attack!
How I paid off our mortgage in 5 years. 12 frugal ways I cut costs to the bone
By the way, we were awfully glad of our tenacity when, after years of infertility, I amazingly got pregnant in early 1996. Despite me quitting the full- time workforce, we still completed paying off the mortgage at the 5-year mark.
How I paid off our mortgage in 5 years. 12 ways I cut costs to the bone that anyone can do.
1. We lived on a written budget.
We had a budget before we bought a home. When we added responsibility of a mortgage and a list of needed improvements, the importance of crafting and living by this monthly document rose almost to "Ten Commandments" status.
We had a self-imposed $10 limit. That was the amount of money either of us could spend without first checking with the other to see if it was in the budget.
- We had a coffee date (at the dining room table) every month to go over figures and track progress.
- We had written short, medium, and long-term goals.
- We cash-flowed every single purchase for my pregnancy and the baby.
2. We stopped eating out.
For years, we gazed at the interior of a restaurant less than a handful of times. We could, seriously, count on one hand the number of times that we at out at any place, including fast food joints. When we did eat out, it was with a coupon or gift certificate and we employed a number of strategies to pay as little out of pocket as possible. For decades, eating out was a tremendous (and rare) treat.
3. I cooked every meal from scratch!
Cooking from scratch became an automatic reflex. Clearly, we weren't eating at any place that charged us money for the privilege, so I had to get out pots, pans, and cookbooks. As I stretched my culinary skills, the quality of the finished dishes improved and, believe it or not, our overall grocery budget dropped!
This downward trend was partly because I began keeping supermarket receipts and going over them with a fine-tooth comb.
As I looked at each receipt, I asked myself a series of questions:
- Is this item nutritionally dense? Does it keep us full for a good period of time?
- Is the item needed or does it fall into the category of “something extra" or “a treat"?
- Is there a healthier alternative available that would still fit within our budget?
- Is this item junk food?
The result of this exercise in introspection was: I began buying more nutritionally dense food.
4. We sold our car!
That's right! We entered the almost unheard of sector of American society who deliberately chooses to survive with one working vehicle. When I became pregnant with our oldest son, we decided to cut our meager income nearly in half when I quit work. I grabbed the budget and ran the figures. We physically could not support the insurance, gas, and upkeep on two cars. So, we sadly bid my car goodbye and made the adjustments.
If I needed the car, I either got up, bundled up the baby, and took Larry to work or Larry rode his bicycle three miles to his downtown office. We were so fortunate to live in such close proximity to his job!
5. We cloth diapered our babies.
The only time my baby's bottom was covered with a disposable diaper was overnight (those soaked through pads were just too much for this sleep deprived mama to bear) and at church on Sunday. That was pretty much it.
6. We eliminated extra trips in the car.
This often surprises people when I add this to my debt reduction list. Most of us don't realize how often we pop into the car to drive five miles in any direction of our home and how much those "in and out" trips actually cost us.
When we began limiting our driving and combining all of our driving into a couple of weekly "errand runs", we saved 40% on our monthly gasoline expenditures. That's pretty good money!
How I paid off our mortgage in 5 years. 12 ways I cut costs to the bone without losing sanity
7. We planned staycations.
Even overnight trips which involved hotels were on our "do not do" list for many years. However, that doesn't mean we didn't have any fun. We had a "vacation" category in our budget and use those funds for several day trips within three hours of our home. We discovered an amazing array of interesting parks, festivals, historic reenactments, and more - right in our own backyard!
8. We line dried ten loads of laundry a week!
When I found out that the average cost of drying a load of laundry was 50¢ a load, I decided to take advantage of free solar power to get our clothing dry each week. I put out ten loads of laundry every week from early spring until my fingers threatened frostbite in early winter.
9. We paid cash for everything!
I suppose this should go without saying, and yet, it doesn't. We saved cash to pay for furniture, clothing, cars, and staycations. If we didn't have cold, hard cash on hand to pay for something, we didn't buy it or replace it.
10. We employed multiple strategies to lower our utility bills.
Over the past 25 years, we have utilized a number of different methods to help lower our utility bills.
Some of these include:
- line drying clothes
- installing a programmable thermostat and then using it to our advantage
- signing up for an on-line account with our utility company in order to track our savings over time
- signing up for an hourly electric rate program, rather than a traditional level-charge plan
- using whole house and window fans
- insulating our attic
- changing to LED lightbulbs
We've had varying results, but most of them have yielded some degree of monthly savings.
How I paid off our mortgage in 5 years. 12 frugal ways I cut costs to the bone that anyone can do
11. We cancelled all subscriptions!
I must tell you that we have never had cable or satellite television in over 30 years of marriage. However, we did pay for some other subscriptions. As much as I enjoyed reading that journal, magazine, or newspaper, this was the time to ask myself if it was really worth the cost.
I looked at each item separately and asked myself a series of questions:
- Is there a way that I can get the same content for no money?
- Do I have a friend who already pays for the same media and would share with me after they are finished reading it?
- Does the local library carry a subscription?
I learned to think outside the box and found many ways to continue educating myself for very little or no money.
12. We prayed - a lot!
The power of prayer cannot be understated and is the cornerstone to our success of paying off a mortgage in five years.
We prayed for wisdom in our finances. We prayed that God would supernaturally give us ideas for saving money. We prayed over our car, our aging appliances, our home, and our neighborhood.
In addition to prayers of petition, we gave thanks. Every time God supplied a need, we thanked Him. Every time we finished the month with extra money, we thanked Him. Every time, we scored side jobs, we thanked Him.
The real results of a paid off mortgage are multifaceted.
- The physical result was a paid-in-full mortgage in five years.
- The financial result was that we learned that nickels and dimes do add up to dollars.
- The spiritual result was a deeper faith in the supernatural provision of God and His blessings in our lives.
- The marital result was that we learned to work together as a team to tackle life and both big and small goals.
- The emotional result was that we learned to be content with what we had.
- The familial result was that we learned to love spending time together doing things that didn’t cost money. Over 20 years later, we still do!
Hi! I’m Hope Ware, married to Larry since 1988 and Mom to four amazing sons, age 22-11.
We have raised our sons DEBT-FREE, including purchasing our second home with cash, on an income, which was consistently under the national median. That’s what inspired me to write my blog: Under the Median. Living on little is challenging – especially if you are raising kids. I don’t give you pie-in-the-sky advice. I’ve been in the trenches and made hard choices. However, I’ve also learned that you can have a spirit of joy and abundance on a shoestring budget.