Years ago a filmmaker asked if she could interview me about my own lifestyle – like what i eat for breakfast and are there any clothes I buy new. I can’t tell you how much I didn’t want to do that. The whole point of FI Thinking is to think for yourself, observe your own life, make your own inspired discoveries, feel smart about how you have a great life on less money than you ever thought possible. What difference does it make to you to find out what I eat for breakfast?
I now am willing to open up my treasure chest of personal choices simply because I’m old enough to be a pretty odd duck and not a replicatable model. You can just use whatever I say for a lesson or a laugh, because money is funny as well as serious, tragic, tough and such.
So send me your questions and I’ll keep this “How does she do it?” theme going. Ask anything about the choices I make that truly give me a life I love – frugally.
Here’s my first entry. I just bought a house with cash. I has a view of the water and mountains in a seaside village that’s highly desirable. How did I do it?
1. I lived below my means for so many years that when I opened up my piggy bank I had enough to pay cash. Everyone is saying I should borrow anyway but here’s my thinking. My ownership expenses at the new house will be a third of my current rent and utilities. The money I save I consider income on my investment, and the rate is 5%. Way better than I can do with CDs or T Bonds. And worse comes to worse, I can live in my house while I can live off but not in my Bonds.
2. I have purchased this house with a friend who also has been thrifty all her life and has the cash for half. A resource shared in a cost cut in half. Not only that, but we’ll each have a private 375 SF area and then share a common area of living room, dining room and kitchen that’s about 1200 SF. My private area is 2/3 the size of my current apartment and I get the 1200 SF additional. And when I leave my private space for the common space i get something worth more than money – the companionship of a great human being. Sharing is a key FI principle.
3. The house was a repo. It was overpriced all the way down and suddenly the bank took over the sale and lowered the price another 15% just to get it off their books. There was a small window of 3 days when they were taking sealed bids. Since our offer was cash, it was a no brainer who the bank picked. We’re sad that our gain was some nice family’s loss, but we are going to fill it with good cheer, some of which we’ll send from our hearts to the family that has moved on.
Somehow, being a saver and a sharer, I now own a house for a third of the average square foot value of homes in my village.
What else would you like to know about the choices I’ve made? Ask anything. I’ll answer what I can.