Living debt free

Howdy Travis and Rolf,

Interesting to see how some Governments and their Farmers operate.

Australia doesn’t subsidise Farmers so they need to continually evolve to meet various World market demands: consumer needs, economic demands and climate necessities. If you were to talk to an Aussie Farmer about subsidising food production, sure, some would hold out both hands and bring along their wheelbarrow for good measure; most however would ask ‘what’s the catch’ and say ‘no thanks’. (I think, in the OECD, we’re second only to New Zealand for lack of Government funding to Farmers.)

However, the Government does fund via Programs that manage seasonal variability, and provide tax deductions e.g. water subsidies, drought assistance, Primary Production Tax Incentives (PP), etc. Most of these Programs are based on LOANS, so Farmers need to pay the money back to Government … lower interest rates than banks.

So, it’s very much a free business model where responsibility is on the owner. The PP incentives means Farmers can claim certain things to gain tax advantages e.g. deductions on equipment costs/devaluation, carbon-sink forest deductions, etc.

In our experience, subsidies just make Farmers complacent and slow to react when market circumstances change. And, they drive down food costs to a point where it is unrealistic. There’s also the very important matter of quantity over quality.

In a dry climate, not having subsidies means relying on other things to be successful – we have a very robust relationship between Farmers and our various science organisations (CSIRO, Landcare, etc) who assist in some brilliant ways to improve cropping, animal production, balancing environmental needs, etc.

To date, we’ve resisted the wholesale spread of GMO crops, and I hope they get the flick completely. A quick check showed we only grow GM cotton, Canola, Safflower and, for some reason, Carnations! Apparently ‘other’ crops are being ‘trialled’. Importation of GM food is another thing altogether.

Dairy Farmers have been treated appallingly, with the big grocery companies subsidising and selling milk at $1 a litre for years and Government doing little to assist. Only recently, following a steady decline in  Dairy Farming, suicide rates, potential supply issues, and media outcry, did the big companies raise the price to keep their ‘cash cow’ churning. It’s still not good enough – I’d like to see milk production go back to the era when real co-operatives existed, milk was priced on market demand, and companies could only buy from co-operatives which couldn’t be owned or influenced by business.

In regards to specialising: for commodity (world market) crops or supplying a designated food-chain (canning factory, supermarket contract), there’s no real alternative. But, for local (national/regional) markets, specialising is usually a risky proposition for a variety of reasons – income from multi-cropping is by far more reliable than a single crop. For example: a Farmer may choose to grow only potatoes whilst their neighbour grows a mixed crop of corn, potatoes, greens and has chickens (eggs). There’s an unusual season and the potato crop fails. At least one of the Farmers has an income.

The traditional pre-WW2 farm was typically a multi-crop affair, selling fresh produce to nearby towns and cities via train and truck transport. It was economical because inputs and outputs on the farms were balanced (fertiliser from animals, feed sourced on-site or from neighbours farms), not influenced by trucking/grocery shop magnates who wanted to control every facet of the supply chain.

We now see a resurgence of these olde ways: ‘Farmers Markets’ and ‘Farm Gate’ stalls. At any of these markets/stalls you’ll find local raw produce like fruit, meat, eggs, etc. The savvy Farmer value adds and provides things like jams, wine, cheese, smoked meats to their counters = $$$$ (usually free of Mr. Taxman!)

I was always told in the agricultural classes I took, and based on my own farming experience this is solid advice, and that is, to always have (3) major production lines on a farm.

They say that because less than three means if one commodity tanks on price, the other two will keep the farm going, and while it is possible two commodities will tank, the chances of all three tanking at the same time are low. Yet when there is more than three commodities produced, a farmer cannot dedicate enough time, knowledge and experience to really get a good grasp on what they are producing.

In my experience, I have suffered because I never had three production lines. I was doing okay when I had a job/logging/sheep, but suffered when I only had logging/sheep.

But I think for most people, rather then doing three things really well and being profitable, they try to "diversify" and end up struggling. To me it just makes sense because while a decent day could be made of tending to the sheep in the mornings and at night, logging in the winter, and raising potatoes during the summer; the focus is very concentrated. It is called Effeciency of Scale. But when a person is trying to care for sheep, care for chickens, care for goats, milk a few cows, etc, because each commodity requires different things, not only is their chore time stretched out, they are scattered-brained because every few minutes their brain has to switch gears, and start a new task, and fear missing a step in between. That induces inefficiency, but also stress.

To wit, rather than switch gears and milk cows, it takes far less time, resources, and mental prowess, to just stay on the tractor and feed 75 more sheep. That just makes the sheep production line much more efficient as no extra time needs to be used in figuring out marketing, storage, nutritional, and equipment needs of the cows. But do not get me wrong, if a person likes cows, by all means just eliminate the sheep, and focus on a higher dairy production system. The point is, do three things, and do them darn well.

But here is the thing, there is something intensely strange about money. You can point of deficiencies in how people handle their money, and how they make it, and yet despite failing at what they are doing, people will defend their method until their death. It is the strangest thing because it is not just people dislike change, no...they defend their system to the point of down-right anger, even though it is clearly evident that it is not even working to them.

F Agricola wrote:Howdy Travis and Rolf,

Interesting to see how some Governments and their Farmers operate.

Australia doesn’t subsidise Farmers so they need to continually evolve to meet various World market demands: consumer needs, economic demands and climate necessities. If you were to talk to an Aussie Farmer about subsidising food production, sure, some would hold out both hands and bring along their wheelbarrow for good measure; most however would ask ‘what’s the catch’ and say ‘no thanks’. (I think, in the OECD, we’re second only to New Zealand for lack of Government funding to Farmers.)

However, the Government does fund via Programs that manage seasonal variability, and provide tax deductions e.g. water subsidies, drought assistance, Primary Production Tax Incentives (PP), etc. Most of these Programs are based on LOANS, so Farmers need to pay the money back to Government … lower interest rates than banks.

So, it’s very much a free business model where responsibility is on the owner. The PP incentives means Farmers can claim certain things to gain tax advantages e.g. deductions on equipment costs/devaluation, carbon-sink forest deductions, etc.

In our experience, subsidies just make Farmers complacent and slow to react when market circumstances change. And, they drive down food costs to a point where it is unrealistic. There’s also the very important matter of quantity over quality.

In a dry climate, not having subsidies means relying on other things to be successful – we have a very robust relationship between Farmers and our various science organisations (CSIRO, Landcare, etc) who assist in some brilliant ways to improve cropping, animal production, balancing environmental needs, etc.

To date, we’ve resisted the wholesale spread of GMO crops, and I hope they get the flick completely. A quick check showed we only grow GM cotton, Canola, Safflower and, for some reason, Carnations! Apparently ‘other’ crops are being ‘trialled’. Importation of GM food is another thing altogether.

Dairy Farmers have been treated appallingly, with the big grocery companies subsidising and selling milk at $1 a litre for years and Government doing little to assist. Only recently, following a steady decline in  Dairy Farming, suicide rates, potential supply issues, and media outcry, did the big companies raise the price to keep their ‘cash cow’ churning. It’s still not good enough – I’d like to see milk production go back to the era when real co-operatives existed, milk was priced on market demand, and companies could only buy from co-operatives which couldn’t be owned or influenced by business.

In regards to specialising: for commodity (world market) crops or supplying a designated food-chain (canning factory, supermarket contract), there’s no real alternative. But, for local (national/regional) markets, specialising is usually a risky proposition for a variety of reasons – income from multi-cropping is by far more reliable than a single crop. For example: a Farmer may choose to grow only potatoes whilst their neighbour grows a mixed crop of corn, potatoes, greens and has chickens (eggs). There’s an unusual season and the potato crop fails. At least one of the Farmers has an income.

The traditional pre-WW2 farm was typically a multi-crop affair, selling fresh produce to nearby towns and cities via train and truck transport. It was economical because inputs and outputs on the farms were balanced (fertiliser from animals, feed sourced on-site or from neighbours farms), not influenced by trucking/grocery shop magnates who wanted to control every facet of the supply chain.

We now see a resurgence of these olde ways: ‘Farmers Markets’ and ‘Farm Gate’ stalls. At any of these markets/stalls you’ll find local raw produce like fruit, meat, eggs, etc. The savvy Farmer value adds and provides things like jams, wine, cheese, smoked meats to their counters = $$$$ (usually free of Mr. Taxman!)

Once I had a teacher who said that humans are by nature lazy and yes,in some way with subsidiry it is tru.Besides of that you loose your pride and to work for subsidires and you will never get a confirmation that you produce for the market and what people really want.

Travis Johnson wrote:I was always told in the agricultural classes I took, and based on my own farming experience this is solid advice, and that is, to always have (3) major production lines on a farm.

They say that because less than three means if one commodity tanks on price, the other two will keep the farm going, and while it is possible two commodities will tank, the chances of all three tanking at the same time are low. Yet when there is more than three commodities produced, a farmer cannot dedicate enough time, knowledge and experience to really get a good grasp on what they are producing.

In my experience, I have suffered because I never had three production lines. I was doing okay when I had a job/logging/sheep, but suffered when I only had logging/sheep.

But I think for most people, rather then doing three things really well and being profitable, they try to "diversify" and end up struggling. To me it just makes sense because while a decent day could be made of tending to the sheep in the mornings and at night, logging in the winter, and raising potatoes during the summer; the focus is very concentrated. It is called Effeciency of Scale. But when a person is trying to care for sheep, care for chickens, care for goats, milk a few cows, etc, because each commodity requires different things, not only is their chore time stretched out, they are scattered-brained because every few minutes their brain has to switch gears, and start a new task, and fear missing a step in between. That induces inefficiency, but also stress.

To wit, rather than switch gears and milk cows, it takes far less time, resources, and mental prowess, to just stay on the tractor and feed 75 more sheep. That just makes the sheep production line much more efficient as no extra time needs to be used in figuring out marketing, storage, nutritional, and equipment needs of the cows. But do not get me wrong, if a person likes cows, by all means just eliminate the sheep, and focus on a higher dairy production system. The point is, do three things, and do them darn well.

But here is the thing, there is something intensely strange about money. You can point of deficiencies in how people handle their money, and how they make it, and yet despite failing at what they are doing, people will defend their method until their death. It is the strangest thing because it is not just people dislike change, no...they defend their system to the point of down-right anger, even though it is clearly evident that it is not even working to them.

I think that these three lines should be connected.For example if you raise meat animanls you start a slaughter factory.
Yes,I have thought about that how stubborn people and even me are about to not change.Big and succesfull companies just shut down a branch.To be able to change bad things is maybe the biggest key to success.

I am horrible as well, but one successful thing I have done this year is to track both bad and good spending habits.

On my budget, I have a place where if I deny myself something, I put a value on it, and if I cave, and give in and buy something I should not; I put that price down. Every month those two things get tallied, with the naughty column subtracted from the good column. In that way I see up to the day, month and year how well I am doing at saving money.

Like last night, normally I might have my wife bring me home dinner instead of eating by myself, but instead I ate at home. That was a savings of $10 for yesterday, but a few days before, I did not eat breakfast at home, and so I stopped into McDonalds and got a $7 breakfast meal. So tallied up, I saved $3, but had I been more frugal, I could have saved $17.

Seeing your spending habits really helps you save money.

Out of anyone who has ever got one over on a bank, I believe it was Katie (my wife) who has.

She worked as a banker, and they were constantly pushing her to "sell" more stuff. Yes banks "sell" things, which for her was credit cards and auto loans; the two high interest payments that make the banks the most revenue. But we believe in being debt free, and it went against Katie's morals. So her approach was to take care of the customers needs. If there was something she could do to save them money, she would suggest it, but if she looked at their finances and they obviously could not benefit from a new credit card or car loan, she would stay mum.

This put her at odds with the bank. She had 100% customer service, won awards, free stuff from the bank for their appreciation, but her boss hated her becaue her numbers did not look good for him.

So one day he told her, "On Monday I want to know if you really want to work here or not. You think about it, and give me an answer on Monday".

So we talked, and on Monday she went in, sat down and told her boss that we had talked things over and that because we did not have any appreciable amount of debt, that she did not need her job at the bank, and that she would be terminating her emoployment. His jaw dropped. It was not what he wanted, or expected.

We are not debt free yet, but our bills are so low that Katie could do that.

Being debt free is NOT impossible for anyone; and yet it is so freeing! I do not say this to sound like, "look what Katie did", in boasting; I say it so that others will be inspired and say, "THAT IS WHAT I WANT." I want people on this forum to work where people want to work because they want to, not because they have to pay off things.

I do not have a lot of stuff, but the pay off is not having the woman I love work at a high stress job...saying, "No, I do not want, nor do I have to work here", was priceless!

Oh, and the kicker...two weeks after Katie quit, she got another recognition letter in the mail for perfect customer service again.

If people are reading this and getting upset...GREAT! As Dave Ramsey says, "Get mad!" I will add, get DAMN MAD.

The system is deceitful and it is wrong! But to change, a person really has to get mad, and change what they have done.

Everyone has "junk". Yes it has value, so sell it off, and put the money you get for it, to paying off debt. How much a person sells is based on how mad they get. There is no other way out, you have to pay for what you bought, but the more stuff you sell, the faster you will get out of debt. I am talking selling your couch and sitting on the floor, sell everything to get out of debt kind of selling.

It is worth it! When you finally buy a couch to replace the one you sold down the road, it will be with cash and on your terms, not Discover Bondage!

Not sure if this is the right place for this post, but I'm new here so am taking a shot at this.

We have been living debt free for over 35 years. We commuted and slaved at jobs, built equity in homes and chucked it all to live the life of OUR choice - remote property and build own home/homestead. I remember saying to my husband that the way to go was 'legal poverty' - basically finding and living below the 'poverty' level considered by the IRS 'zero pay'. We leveraged (and risked! ) the savings that we had built from the equity of our previous house(s) using that for materials needed to build with. Sweat equity, NO 'wages' and DIY as much as possible resulted in a very nice and livable house & homestead. During those years we used wood heat, solar electricity and cooked with a solar oven weather allowing. It wasn't as primitive or backwards as people usually associate but it was a bit haute camping at the beginning.

We also created and developed a flea market business that not only allowed us to have some income and work 2 days a week, but provided us with the BEST shopping one could imagine. Unfortunately the quality and variety of resale items dropped to the junk level that is found in most stores today. Any decent and serviceable item is now considered an 'antique' or collectible and sells for way over any store bought replacement item.

We sold and moved away from that location as citidiots (city idiots) began to move in around us. these folks wanted a country atmosphere but with city type living. Needless to say, they ruined the area and we were glad to collect our enriched equity and move on to a saner situation. The equity built up by our efforts resulted in more than we needed for next place & house built allowing us to invest savings for retirement living.

We still live 'extreme' frugal - its just a wonderful habit and self reliant way to NOT be hooked into so-called modern living. Not only do we live debt free, we haven't paid an electric bill for 35+ years, and enjoy fresh eating from our garden season allowing.

elle sagenev wrote:Hey all,

We are currently teaching a Dave Ramsey class which has my mind on this topic. Plus my husband wants to quit his job because he hates it. We have no consumer debt. We DO have a mortgage which is on a 15 year mortgage and will be paid off early. How early kind of depends on our dedication at this point.

I think living debt free is the solution to most problems. I enjoy the extra money having no payments has given us.

Just wondering who else out there is doing it and such. Seems like a real permie thing, no debt.

I love stumbling across this topic.  I decided to search for "Dave Ramsey" here in the forums and this was the first thread I came across.  I've been a fan of Dave Ramsey's program for 10 years now.  I attained debt freedom once, just before some medical expenses and the same old stupid thinking got me back into it again.  After attending FPU personally a couple years ago, I've jumped back on the debt wagon again with gazelle intensity and am putting everything I can into getting out of debt...again - and planning on how to *stay* out for the rest of my life.  I believe this is a *very* solid permaculture principle and often overlooked within our life planning.  Look forward to reading all the replies here on this thread.

Rob Kaiser wrote:

elle sagenev wrote:Hey all,

We are currently teaching a Dave Ramsey class which has my mind on this topic. Plus my husband wants to quit his job because he hates it. We have no consumer debt. We DO have a mortgage which is on a 15 year mortgage and will be paid off early. How early kind of depends on our dedication at this point.

I think living debt free is the solution to most problems. I enjoy the extra money having no payments has given us.

Just wondering who else out there is doing it and such. Seems like a real permie thing, no debt.

I love stumbling across this topic.  I decided to search for "Dave Ramsey" here in the forums and this was the first thread I came across.  I've been a fan of Dave Ramsey's program for 10 years now.  I attained debt freedom once, just before some medical expenses and the same old stupid thinking got me back into it again.  After attending FPU personally a couple years ago, I've jumped back on the debt wagon again with gazelle intensity and am putting everything I can into getting out of debt...again - and planning on how to *stay* out for the rest of my life.  I believe this is a *very* solid permaculture principle and often overlooked within our life planning.  Look forward to reading all the replies here on this thread.

Katie and I are going through Financial Peace University as well, and while I do not agree 100% with what Dave Ramsey says (mostly dealing with his views on insurance), it has really been freeing. We are running like gazelle's with Springs attached to our legs, and are a few months away from being debt free.

For us, it is hard because we have no income coming in right now. Katie is trying to get her Day Care up and running, and I am sick with Cancer, but we are still selling stuff, paying down debt, and paying bills, so if I can do that with NO INCOME, others with a job surely can!

Gazelle intensity baby!

Probably one of the greatest motivation video segments ever on getting out of debt. "You got to run!" (Dave Ramsey)

Travis Johnson wrote:

Being debt free is NOT impossible for anyone; and yet it is so freeing! I do not say this to sound like, "look what Katie did", in boasting; I say it so that others will be inspired and say, "THAT IS WHAT I WANT." I want people on this forum to work where people want to work because they want to, not because they have to pay off things.

I do not have a lot of stuff, but the pay off is not having the woman I love work at a high stress job...saying, "No, I do not want, nor do I have to work here", was priceless!

Oh, and the kicker...two weeks after Katie quit, she got another recognition letter in the mail for perfect customer service again.

My husband quit his job in February. Not many people could handle the lose of a husband's income. I enjoy flaunting the norm there!!

Good on you guys. I hope you continue to do well and her day care business takes off!

elle sagenev wrote:Hey all,

We are currently teaching a Dave Ramsey class which has my mind on this topic. Plus my husband wants to quit his job because he hates it. We have no consumer debt. We DO have a mortgage which is on a 15 year mortgage and will be paid off early. How early kind of depends on our dedication at this point.

I think living debt free is the solution to most problems. I enjoy the extra money having no payments has given us.

Just wondering who else out there is doing it and such. Seems like a real permie thing, no debt.

Good morning Elle,

I decided to refresh this thread a little bit after searching for an appropriate place for another new post.

We've connected elsewhere on other threads regarding debt and it's great to see you coordinated a Dave Ramsey class also.

I got so much out of the course that I decided to do the same...and we are going into week 4 of our own FPU course.

You wrote:

I think living debt free is the solution to most problems. I enjoy the extra money having no payments has given us.


I couldn't agree more...and am so grateful my biggest financial problem right now is figuring out what "retirement" means to me.

That - and how to continue integrating permaculture into my life (and do so more efficiently) now that I am debt free (or will be within 6 months)!

For me the key is determining what are truly NEEDS and what are actually WANTS.

I lived FAR below the poverty level until I married in my late 40's. Self employed meant boom and bust for the bank account. So priorities were key: rent/mortgage, insurance, power, phone, food.

Anytime I had a windfall I would make sure I paid things like power and phone a year, in advance.

Once that was done, extra money went on account at my vet's, or to make extra housing payments.  I could even buy gas 'in advance' on the co-op gas card at a preset price, and kept that for times when money was short.

Bought food in bulk, often living off the deep freeze and pantry for months. Let the oil tank run dry (okay, I live on the West coast of Canada, but hey, it was on average 50-55 F inside during winter) and only used a space heater for the bathroom and an electric blanket in the bedroom.

Used an antenna for TV. Clothing from the Thrift Store. Shut the power to the hotwater tank - only turned it on an hour before showering twice a week (that sucker was costing $50 a month!!). Never paid more than $500-1,000 for a beater car (what I paid in repair bills annually was less than my friends car payments for one month). I chose a place to live I love, so vacations were/are unnecessary. It is amazing how little one can do with, if one needs to.

Cash was king, no debit, no credit card, no overdraft (unless I didn't have enough for the rent/mortgage).  I lived debt free (not counting the mortgage) on less than $20,000 annually, for over 30yrs. My friends made 3 to 10 times what I did, but we're always broke or filing for bankruptcy. The key is identifying needs over wants. I wanted to own land - I got my half acre in my early thirties, even if my parents had to co-sign - the bank said I didn't make enough - but paid it all by myself! Needs, not wants....

Lorinne Anderson wrote:For me the key is determining what are truly NEEDS and what are actually WANTS.

I lived FAR below the poverty level until I married in my late 40's. Self employed meant boom and bust for the bank account. So priorities were key: rent/mortgage, insurance, power, phone, food.

Anytime I had a windfall I would make sure I paid things like power and phone a year, in advance.

Once that was done, extra money went on account at my vet's, or to make extra housing payments.  I could even buy gas 'in advance' on the co-op gas card at a preset price, and kept that for times when money was short.

Bought food in bulk, often living off the deep freeze and pantry for months. Let the oil tank run dry (okay, I live on the West coast of Canada, but hey, it was on average 50-55 F inside during winter) and only used a space heater for the bathroom and an electric blanket in the bedroom.

Used an antenna for TV. Clothing from the Thrift Store. Shut the power to the hotwater tank - only turned it on an hour before showering twice a week (that sucker was costing $50 a month!!). Never paid more than $500-1,000 for a beater car (what I paid in repair bills annually was less than my friends car payments for one month). I chose a place to live I love, so vacations were/are unnecessary. It is amazing how little one can do with, if one needs to.

Cash was king, no debit, no credit card, no overdraft (unless I didn't have enough for the rent/mortgage).  I lived debt free (not counting the mortgage) on less than $20,000 annually, for over 30yrs. My friends made 3 to 10 times what I did, but we're always broke or filing for bankruptcy. The key is identifying needs over wants. I wanted to own land - I got my half acre in my early thirties, even if my parents had to co-sign - the bank said I didn't make enough - but paid it all by myself! Needs, not wants....

Well put.   Wants vs. Needs.  Yep, I use the same terminology when people ask me how I got where I am.  Also, "sacrifices", and "eliminating luxuries".  No Starbucks, no magazine subs, no Netflix, no trips to the movies, no fancy brand name clothes, no restaurants or fast food, no labor cost for car repairs or home repairs (I do them all, even if I have to slowly learn how to), not buying things needed until there's enough actual cash on hand to buy them.  It's not for everyone, but it is a way to get to living debt free.  (* let's not mention beer, that is a necessity, in my opinion.... I'm work'n on it, though.)  



I've been debt free since 2008, but here's the thing.  I live like I'm poor.  Brown rice, beans, potatoes, and whole wheat pasta constitute 70% or so of my diet.  Currently I'm trying to offset even more by growing my own food.  I rent out 80% of my mortgage free home so I can take time off of work for months at a time and still have a passive income.

I've mentioned this before in another thread.  I learned from foreigners I used to work with back in Silicon Valley.  They'd come here with no money to start with, become managers of large apartment buildings (getting to live in a unit rent free comes with the job, along with dealing with collecting rent, and all the other b.s. that comes with dealing with renters, small repairs, painting, plumbing, etc.).  They'd have full time jobs working with me, and then they'd save up to buy a house.  Then, they'd rent that house out for more than the mortgage on it.  Then they'd save up and buy another house.......all while living a meager existence in the apartment.  They are multi-millionaires by now.....

Another way to do it, would be to buy a house that could accommodate an r.v. parked somewhere on the property.  Rent the main house out, and live in the r.v.  Let the renters pay the mortgage.

Not ideal, but sacrifices are needed, not forever, just until one is at a place where they can get out of debt.  Maybe that's a decade + or - , a sacrifice.

Edit, The answer to the question is easy.  The actual "act" of doing it is the hard part, from what I've seen.

For example, and this is not to be negative to anyone's choices, merely an observation on my part.
Everyone knows that to lose weight, they have to eat less/exercise more to achieve that goal.  
The answer is easy, it's not a secret, and it's well known.
Actually practicing it, that's the glitch in the answer.  It's harder for some than for others for whatever reason that is.

That goes for everything in life.  I have a hard time practicing a lot of things that I know the answer to.  It's a conundrum.

They'd have full time jobs working with me, and then they'd save up to buy a house.  Then, they'd rent that house out for more than the mortgage on it.  Then they'd save up and buy another house.......all while living a meager existence in the apartment.  They are multi-millionaires by now.....

My husband and I are actually working on this same plan as the foreigners you mentioned! We’ll be buying our first home fairly soon- just to rent it out. Meanwhile we’re living with my parents (rent free).

We’re lucky our parents totally understand our outlook on life and are supporting us in this- I’m just super curious to see what my siblings’ reactions will be when they find out we bought a house and yet still live with my parents!

just a tiny thought on the subject, I guess one could be debt free being a vagabond, but once you sink your roots and purchase a property there are always taxes and other unforeseen expense and then of course you want to make improvements and in todays world it never seems that anything is free.

bruce Fine wrote:just a tiny thought on the subject, I guess one could be debt free being a vagabond, but once you sink your roots and purchase a property there are always taxes and other unforeseen expense and then of course you want to make improvements and in todays world it never seems that anything is free.

We aren't necessarily talking about living expense free, rather being debt free as in having borrowed money you owe that is accruing interest payments as well.  I've been debt free for about 15 years now, including my small homestead and it is wonderful.  I might even be able to live cheaper than many vagabonds here since my place provides not only shelter, but also food, water, and energy with an annual property tax bill less than most people pay for a months rent.  I'm guessing vagabonds would often have to find ways to get money to pay for these things.

ok I get it, there is a difference between debt free and expense free. I guess my brain is just stuck on fact that it is so very difficult to make a transition to living free- expense free that is.i guess that once your life is lived with huge or any debt is very difficult to get debt free but is do able and something worthwhile to strive for. sometimes I guess it can be realized by examining the difference between wants and needs. and as I write this just today started seriously planning on turning a bunch of raw lumber into cedar chests in an attempt to generate----cash so I can pay those seemingly never ending expenses

bruce Fine wrote:ok I get it, there is a difference between debt free and expense free. I guess my brain is just stuck on fact that it is so very difficult to make a transition to living free- expense free that is.i guess that once your life is lived with huge or any debt is very difficult to get debt free but is do able and something worthwhile to strive for. sometimes I guess it can be realized by examining the difference between wants and needs. and as I write this just today started seriously planning on turning a bunch of raw lumber into cedar chests in an attempt to generate----cash so I can pay those seemingly never ending expenses

Lots of differences in debt vs expenses for sure...

...and the transition to minimal expesnses goes part and parcel with permaculture.

If you want it to...that is.

Permaculture is such a wide umbrella and can encompass so much.

Permaculture can include debt if you want it to...

...permaculture can include a debt free lifestyle if you want it to.

Examining wants vs needs is *never* a bad thing to do...

...likely opening up more lines of thought that had we not thought about that.

Recently in another thread I found myself seeking answers to 3 questions that were posed to me:

What are you doing right now that that generates income - building up to that 12 months of expenses?

Are you living off the land now?

What is your vision for using permaculture as a plan for where you want to be 3 years from now?

Personally, these are great questions to be asking myself...

...and only questions that I could examine clearly without the burden of consumer debt.

Thanks to Anne Miller for liking my post and allowing me to revisit this thread.  

Here's an example of someone who has minimized his monthly expenses to a few hundred dollars and personal belongings down to a backpack, and is enjoying financial freedom by traveling to where the weather is always nice and it's affordable to legally stay:


A person could work for a summer to save up a couple thousand dollars and then live this way the rest of the year, or if you can work remotely via the internet you could work part time and have plenty to cover food and whatever you enjoy doing.

Paul has done at least one podcast with Jacob from Early Retirement Extreme, where the idea is to minimize your expenses to maximize your savings, and then once you save enough the interest off that savings cover your minimal expenses.

I always know some politician is going to pick my pocket when they say something that starts with "In a country as rich as ours...."  The advertisers have been pretty successful at convincing us that "you deserve this, spoil yourself!"  Untrue!  There will be some things you decide you need, but consider the cost.  I take a hot bath every day because it helps with my back.  I realize it is a luxury, but I am willing to pay for it.  What kills us is the little luxuries we take without thinking about them.  

When I was young I read Walden Pond, by Thoreau.  If you haven't read it, do so.  He layed it out pretty clearly how much of our lives we spend trying to pay off debts, which we mainly accrue so we can pay off the debts.  Foolishness!  His whole point of going to Walden Pond was to show how cheaply and well a person could live.  There are some great insights and points to ponder.  If he had been born in our time he would definitely have been a permie.  

I remember when I was a teenager and my mom started 'splurging' and using plastic wrap over left overs, rather than covering them with an upside down plate.  Plastic wrap was around for quite a while before that I think, but she didn't use it until she had weighed the cost/benefits.  My grandma used both aluminum foil and plastic wrap, you could tell because she washed it after each use, dried it and reused it.  I have never been really impressed with Dave Ramsey because my dad preached that same sermon the whole time I was growing up, as did most of my relatives who grew up during the depression.  They would sometimes talk about some of the stupid things they had done starting out, pointing it out what idiots they were, so we would be smarter.  Dave just seems like more of the same.  It's never about how much cash you can bring in.  It's about how much you can keep in you pocket at the end of the day.  

We don't have a credit card, although I have gotten used to using my debit card most of the time.  I resisted it for years, but it's so darned convenient!

We just bought a new  place with a 30 year mortgage, but I figure we'll pay it off in about 10 years.  We have always just paid cash for what we needed and if we couldn't pay for it, we didn't get it.  I think we once had to buy a used car on payments, but we paid it off within a couple months.   Most people in this country don't know how to live poor and live well.  I'm surprised at the number of people who don't know how to cook from scratch.  Shop the outside edge of the grocery store, haunt the thrift stores and garage sales.  There are far more 'good ideas' than you can afford.  If something is convenient, you're probably paying for it in higher cost and lower nutrition.  I'm not sure my kids really knew what cold cereal was.

Around 1990 My wife and I were living in the suburbs of Chicago when our fifth kid was born.  I was going to school to get my engineering degree and working with a bunch of engineers.  We were living in a neighborhood where it was mostly Drs. married to lawyers with a small dog or at most 1 kid.  My wife would get dirty looks from the 'professional women' in the grocery store when she came in with all our kids.  One day a bunch of my coworkers came to me and asked "How can you survive, we all make way more than you, our wives all work and we only have one kid each.  We're barely surviving.  How can you survive without your wife working and all those kids!"  I could have told them the Dave Ramsey saying about eating 'beans and rice, alternating with rice and beans'.  Instead I decided to blow their minds a little further and said, "Well, I pay a full tithe too,..." That really blew their minds.  

Years later, I was working in the bush for weeks at a time, usually leaving early monday morning and coming back Friday evening.  We had a house load of kids, both teenagers and babies (teenagers are emotionally exhausting, babies are physically exhausting, both together are really rough).  I made a lot of money, with a pretty good salary plus per dium and overtime, but my wife ordered a lot of pizza when I was on the road (I can't blame her, it's a wonder she kept her sanity!) and we weren't able to save much of anything.  When I left Alaska and moved to the midwest, I took somewhere between a 33 - 50% paycut, but we made out better because I was home more.

Travis Johnson wrote: A vacation? I am on vacation everyday as I can do whatever I want, when I want. I have nothing to take a vacation from.

Thanks for sharing! What an inspiring post! This quote was especially excellent.

The alternative I used for neither renting (with money) nor having a mortgage was bartering.

When I was younger, I contracted babysitting/nannying a certain number of hours per month for housing. The homes I stayed in where far above what I could’ve afforded then (or now) and I was able to work full-time elsewhere to cover my other living costs. I also, as a young single woman, was able to be a lot safer because I lived with a family and in low crime neighborhoods.

They were also blessed because not only did they have trustworthy guaranteed childcare for certain hours, they also never had to pay for a pet or house sitter if they went out of town.

(Of course, I recommend that if someone is bartering to have clear boundaries and expectations with lots of details so both parties understand expectations. One situation was a written contract and another was just verbal because there were years of trust built.)

Our property had a 30-year mortgage, which we refinanced into a 15-year mortgage with a cheaper interest rate and paid off in seven years. We are now debt-free. Despite the fact that we use credit cards, we pay them off every month. This is the only way I want to live because I am debt-averse! Being self-employed in an unstable business, we never had a regular income, so when it dropped or ceased, we went on what we termed "The Poverty Plan," where we just bought basics and ate extremely inexpensively. We would pay down the mortgage with any excess money we had.

Nice job Martin!  I hear you about irregular self employment income too.  That's where I'm at as well.  I think it's a great life, but there is no way I could live paycheck to paycheck in this sort of situation.  I initially had to severely reduce expenses in order to build up a financial cushion in order to stay ahead of the game, rather than trying to always play catch up!  In the process I found I could live a high quality life on little money thus making it ever easier to live debt free.

Marco Banks wrote:
But my concern is with folks who think that a mortgage is somehow evil debt.  That (in my tremendously humble opinion) is so short sighted.  Why SHORT sighted?  Because when you are renting, you are not only paying with money, but also with years.  Every year you rent, you will never get back.  You only get 75 or 80 years, and every year you waste, you miss the opportunity to build wealth.

Our mortgage principle drops by about $1800 a month.  That's money into my pocket.  While you speak of putting $5 bills in a jar, I know that our equity is appreciating about $60 a day just from that payment.  If the greater housing market goes up by even 1% a year, my home appreciates by $10,000 or more.  So with just a 1% market increase, that's another $28 bucks a day into my pocket.  Last year, homes in Los Angeles county appreciated by about 7%.  You do the math --- that's about $190 a day, without lifting a finger.  That appreciation would happen if I owed 100% on the home, or only owe 22% (which is where we are at now).  

So, putting $5 or $10 a day into a jar is good.  I'm not pissing on that at all.  But silently putting $250 a day into my long-term capital wealth is a whole lot better.  Paying for your kids' college tuition with a credit card and getting a half-dozen free trips out of it over the years?  That's pretty cool as well.  (Few colleges let you do that anymore, but our kids' schools did.)

If I were renting, my out of pocket monthly expense would be at least 50% higher for the home we live in, and none of that equity would be mine -- not a single penny.  Assuming debt to purchase land isn't risk free, but for the vast majority of people who pay a reasonable price and have a clear strategy how they'll pay it off over the next 30 years, it's an almost fool-proof means of accumulating wealth.  

If you've never read Rich Dad/Poor Dad, you may wish to pick up a copy.  You'll find used copies at Goodwill for a buck or two.  Pay cash for it, if you so desire, or better yet, check it out from the library.  

I had to laugh at this. I am mostly through “Rich Dad, Poor Dad”, and he spent a good deal of time explaining why living in a house with a mortgage is a liability, not an asset.

However- aside from the stock market and flipping foreclosed homes, much of his wealth seems to be in real estate. A lot of those buildings he rents out, and he is clear that borrowing money is not a bad thing for him. So he, along with many other landlords, can pay off mortgages, hire property managers, and STILL make money off of renters. So, I am not convinced that renting is better than buying… which to be fair, the author never exactly said it was.

To me, the main issue is how big your mortgage is, relative to your income and savings. Our mortgage is small enough that we overpay every month, add to our savings, are slowly but surely improving the house and permaculturing the land, and have 3-5 months of living expenses in the bank. We did not buy in a bubble.
All this means that, if one of us lost our job, we could go on living more or less as we do, just adding less yo savings. If we both lose our jobs, we would have a few months to either get new ones, or to sell the house and find a cheaper alternative. Barring a truly devastating housing crash, we would walk away with at least a little money in pocket, after the mortgage was paid off.
Will we ever make money from this house by selling it? Probably not, given all the interest - prices would have to go up a LOT, or we would have to sell soon, which aren’t planning on. But, we won’t lose money, and we are having a blast permacuturing, watching chicken tv, and all the rest of it. Waiting 10 years to buy our property with cash would not have left us better off. Neither would waiting to make improvements and shorting our retirement funds and savings to pay down the mortgage faster than we are.
Emotionally, I still don’t like being in debt, even though we are in good shape financially. But logically, I know we are better off with the path we are taking.