Hi! I’m Melina, homeschooling mother of 11 and Grandmelina to 2!
My husband and I have been married for 26 years and are now living debt free. We haven’t always. We were like most young families, buying a house and paying off a mortgage, paying off a car loan, carrying a balance on our line of credit to pay for house renovations and repairs, car repairs, and other unexpected and unbudgeted expenses.
We knew right from the beginning that we wanted me to be able to stay home to raise our kids and to homeschool them. This meant we would be living on one income. After the really big decision to live on one income, there were many other big decisions that had to be made along the way.
Faith is at the center of our lives and the center of our decisions. We trust that God will provide. We have seen often enough our needs being met in unexpected ways. That is God at work in our family and in our finances. Everything works so much better when our decisions are made after much prayer.
God doesn’t want us to worry about money. Sometimes debt can’t be avoided, but steps can be taken so that the debts don’t grow unnecessarily. It might take time, but debts will shrink and disappear with proper money management.
A couple of years ago we had to redo our roof, and we knew it was a debt that we wanted to eliminate as quickly as possible. We enjoyed living debt free! I wasn’t sure where the extra money was going to come from, but I trusted God would provide. I thought we were just going to have to tighten our belts. But God had a different plan. He provided an unexpected monthly increase in our income EXACTLY when our first payment was due. A year later the roof was paid off!
It was only in later years that I heard some advice that helped us to finally eliminate our last lingering debt: our line of credit. I will tell you all about that advice in a future blog.
If we can do it, so can you!
#1 BUDGET, BUDGET, BUDGET – You need to keep track of your income and expenses. Without a budget you are never sure where your money is going. Make a list of all your expenses, and if it exceeds your income, decide what you can eliminate and where you can cut back. We have 2 pays a month, and I allocate certain expenses to each one as well as gas, groceries and tithing which of course are budgeted on each. I know our limits and try very hard to stay within them. We work hard to keep an amount in our savings account for unexpected expenses. We have a set amount automatically go into a savings account for us. Those expenses that are not monthly, like water, property tax and sports, are broken down into monthly amounts that get transferred into a separate account until needed. We have also seen the benefit time after time of tithing. Tithing means we give 10% of our net income to our church. When we do this, we always seem to have enough money to pay our bills. When we don’t, there never seems to be enough money. Seems backwards, but it has always been the way for us. God is good!
#2 AFFORDABLE HOUSING – Our first decision was to move to where housing was affordable. This meant moving to a small town, which is where we preferred to raise our family anyways. Our down payment came from a back pay after a job evaluation. Our mortgage payments were smaller than rent would have been in the city. Back when our property taxes were paid with our mortgage, our tax account would accumulate extra money that we would ask to be paid out to us every couple of years. A review of our house insurance with our adjuster helped us to find a way to lower our monthly payments.
#3 AFFORDABLE DRIVING – My husband owned a car before we got married that was financed. The monthly payments were hard to budget and that helped us to decide to buy used vehicles after that and eliminate a monthly bill. Our yearly tax return would help us to pay for our vehicles when they needed to be replaced. Shopping around for the cheapest car insurance helped to lower another monthly payment. My husband works in the city, and we live about 70 km away from his work. Gas is our biggest expense after food, but when we weighed the pros and cons of moving to our small town, small town living still won.
#4 SAVING ON GROCERIES – Cooking homemade meals and eating at home is an easy way to save money. Baking your own desserts is much cheaper than buying ready made. Eating out is expensive and should be reserved for special occasions and date nights. When home life is especially busy, I revert to cooking simple meals like chicken legs and rice, or I make a big pot of spaghetti sauce and we have pasta. With a only a few additions, the next night it changes to chili, with chili dogs being served the third night. There are ways to cut down on money and also cut down on time. Take time to study flyers and use coupons. Build your menu according to the sales for the week. Stock up on regularly used items when they come on sale. I don’t use coupons often enough, but I have friends who save a lot of money this way. I have a couple of stores where I like to buy my groceries because they have the lowest prices for what we buy. Even though we don’t have a large garden, we do grow our favourites, including tomatoes and cucumbers.
#5 BIRTHDAYS AND CHRISTMAS AND EASTER – These are very special events that also need to be budgeted for. Birthday presents have a limit of $50, and Christmas presents max out at $100 for the “big” gift. The kids also receive a new outfit on birthdays, Christmas and Easter. Christmas outfits are bought at the end of the previous winter from discounted racks, and Easter outfits are bought at the end of the previous summer. Christmas also has stockings, and Easter has baskets full of goodies. Money is saved, but there is still lots to enjoy. And of course the best part is just getting everyone together to celebrate anyways.
#6 THRIFT STORES AND HAND ME DOWNS – A bonus with having a house full of children is that people are very generous. We would often find a bag of clothes anonymously dropped off in our vestibule. Even if we kept only a few items from the bag, they were much appreciated. People also gave us larger things, like bicycles and furniture, and even vehicles. Those things that weren’t donated to us that we needed we bought in thrift stores and at garage sales if possible, or bought on sale. It’s important to decide if what you want is really something you need. Sometimes you just need to put off a purchase for a little while to save up for it. And try to reduce, reuse, and recycle.
#7 RENOVATIONS AND REPAIRS – Doing the work yourself on your home or your vehicle is so much cheaper, and you have the added benefit of learning a new skill. You can build and assemble furniture. There is pride in knowing that you can repair and build. But don’t stop there! You can also mend and sew your own clothes, knit, crochet, craft and create. The possibilities are endless. It’s true. Sometimes one person’s junk is another person’s treasure. Just fix them up and use them. So many items in our home have been given to us. Resist the urge to buy unnecessary items. Not only do they add an extra expense, but they will also clutter your home.
#8 INEXPENSIVE AND FREE – Get creative and have fun as a family without it costing a fortune. We like to drive down to the water, feed the ducks and watch the ships sail by. You can borrow passes from the library to tour museums. Make popcorn and watch a movie at home. Take time to play a board game as a family or go to the park. We even host a week in the summer at a camp that provides affordable vacations for needy families. In exchange for organizing and running activities, we get a free vacation. We go camping. We tend to play sports that are same night, same time that have family rates. It might be because we live in a small town, but our kids play soccer, broomball and take karate this way. Make it a challenge to spend as little as possible and you will come up with some great ideas.
#9 HOME BASED BUSINESS – At different times I have contributed to our finances too. I began a home based chocolate business back when I had only 5 kids. It seems like a lifetime ago! Part of my vision was to work with my kids, another part was to give them a business education. Education is about so much more than books! However, as our family continued to grow, we decided it was no longer feasible to grow our business. Later, I babysat my niece. This was a mutually beneficial arrangement that lasted over a year. Next, we re-opened our chocolate business, but with a new twist. Now we sold mostly fudge. It was a great adventure for a few years! All of my kids worked in the business to varying degrees, and it grew. The kids made money and I managed the business. We sold at fairs, farmers’ markets, craft sales and even at a local store. The kids learned a lot, but eventually it was time to close this business too. These businesses gave us extra income. Even though the businesses remained small, they could have become a main source of income.
#10 RAISES MEAN EXTRA MORTGAGE PAYMENTS – Every time we got a raise, we would use that money to increase our monthly mortgage payments. Extra payments meant that the length of our mortgage decreased from 25 years to under 16 years. Resist the urge to refinance your mortgage to pay off your bills. Instead, find a way to live within your means and eliminate that need. The freedom found in having no mortgage is priceless. I thought that when we no longer had to pay a mortgage, that all of our other debt would magically disappear. But it didn’t. Instead, we just spent more money. It took decisions and determination to finally eliminate our debts.
#11 BEING COMMITTED TO PAYING OFF DEBT – The unpaid balances on our credit cards were always moved to our line of credit which kept all our credit in one place and had a lower interest rate. While this seemed like a good idea, the reality was that the amount on our line of credit seemed to remain constant no matter how much money we paid down on it. When we decided to get rid of the balance on our line of credit, we had to be very, very strict. We were committed to paying down a certain amount every month, and also committed to NOT adding to our credit each month. This worked most months. We had to be very cautious and very serious. It also meant that sometimes there was hardly any money left for groceries. But don’t worry, because we never went hungry. No groceries didn’t mean we had no food, only that we got creative with the food that was still in our cupboards. We weren’t so committed to eliminating our line of credit that we would have allowed our family to go hungry. However, we were able to stick to this plan until our line of credit was paid off, without once going hungry. I’ll tell you more about it in a future blog!
Final result? We now have the freedom of living debt free!
God is good!