Monthly Financial Check-up

It's September and that means it's time for our monthly financial check up. How did you do in August?

Here are our quick stats:

We began August at 57.8% of our house savings goal and we ended the month at 65%!

I about fell over when my husband did the math and told me the final tallies. It's so excited to finally be getting really close to something we've long dreamed about, talked about, prayed about, and worked very hard towards.

Recently, a blog reader I had the privilege of meeting in real life was commenting to me about how difficult it must be for us to be waiting to purchase a house when we could afford to go out and pay 65% down on a home which is roomier and better-suited for our family than the rental we're currently in.

While having more than two bedrooms would be nice and having a larger yard that doesn't back up to a busy highway would also be a wonderful thing, neither my husband or I feel like we're in the least bit miserable waiting to pay 100% down. In fact, we both are very determined we want to stick it out to our 100% goal–even if it takes longer than we hope.

Why? Well, for one, we want to stand by our commitment to stay out of debt. We understand that this is not possible for everyone in every situation. That said, we do believe it is much more possible than many people believe it to be. And we hope that we might be an inspiration to some of you to set big goals and work hard towards them.

We also want to be an example to our children. Growing up, my parents had a dream of getting out of debt and then buying land and building a debt-free house out in the country. They worked hard towards that goal and when I was 12 years old, we not only had paid off our house, we had purchased land, built a house, and moved in.

Seeing their example made a major impact upon my life and this is one of biggest reasons we're currently aggressively saving towards buying our first home debt-free. It is our hope that our children can stand on our shoulders–just as we seek to stand on the shoulders of our parents–and, who knows? Perhaps they will be able to buy their first home with cash before they are even married!

In addition, we want to be the best stewards of the resources we have so that we can bless as many people as possible. We aren't seeking to pay cash for a house so that they we can go pursue some extravagant lifestyle. Instead, paying cash for a house is just the first step in a long line of goals we have for our family as we seek to make an impact in this world by giving of our resources to help those in need.

We feel that living a life without payments and with a strong financial plan in place will better enable us to reach out to those in need. And we're incredibly excited about the possibilities to give and serve with our finances–as God allows us to do so. (By the way, there's an excellent video here which has been a huge inspiration to us in this regard.)

So yes, our home might be a wee bit small right now, our yard even smaller, and it might seem very counter-cultural for us to wait just a little bit longer until we've saved up 100% to pay cash for a home, but we're willing to wait because we know that someday it will be worth the sacrifices!

(If you're new here, be sure to check out this post where I explain in detail why we've committed to this "crazy" idea to pay 100% down on a home. )

How did you do in August? Whether
or not you posted financial goals for 2009, please take a moment to
post about your financial successes and/or failures in August and, if you'd like, the areas
you hope to improve in September. Then, come back here and leave your link
below. If you don't have a blog or would rather share anonymously, feel
free to leave your update in a comment. Let's all keep each other
accountable to be better stewards of
our resources!

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  1. Kelly says

    Thank you for sharing your progress Crystal. Reading about your commitment to your large goal has kept me inspired to stick to my smaller ones!

  2. Tausha Habecker says

    I have done the math on trying to reach this goal many times. For families earning around $50,000 a year or less it just doesn’t add up. My husband and I are currently saving almost 50% of his take home pay. And that does not count the 5% that comes out automatically for his 401K. His paychecks range from $650-$800 per week take home and we consistently save $350 per week. So saving for 5 years gives us around $91,000 plus a little interest earnings. So that is not enough to buy the average house. Let’s increase the goal to 10 years, that gives us $182,000. More realistic amount to buy a house with. But even a house currently worth $182,000 with an increase of value at 2% per year would cost $222,258. So do I increase savings, do I put the money in riskier investments to try to earn more interest, do I wait 12 years to buy, or do I take out a mortgage at the 5 year mark with a sizable down payment? We have chosen the 5 year goal.

    Money Saving Mom here: I’d agree with you, Tausha! And way to go on your savings goals! You guys are doing incredibly well–most people don’t even consider a sizable down payment in today’s day and age!

    Because of wise training from our parents, no debt, wise stewardship, good income, and the blessing of God, we’re in a position where if we are very aggressive and frugal, we can save a large amount of our income and it makes sense to wait a short while and pay 100% down. However, if we were only able to save a small amount each month, we’d still scrimp and save, but we’d likely consider a different route and possibly even consider a mortgage (with a very large down payment which we’d aggressively seek to pay off in less than 7 years).

    That said, we never expected to be able to save as much as we have been as fast as we have been able to. We’ve found that having a big goal and both working together very, very hard towards it as well as seeking to be the best managers of the resources God given us has allowed us to become much more creative and has opened up all sorts of doors which we never anticipated.

    So you just never know. Be faithful with what you have where you are, set goals, work hard, don’t give up, and you just might be surprised as well!

  3. says

    That is awesome, Crystal! Praise God for how you have been good stewards of what God has given. YOu are such an inspiration to me. Last month I was super excited. We paid off one debt and within one month reduced our debt by close to 20%. Praise God!

  4. Eli - perhaps your only male reader :) says

    I can’t tell you how impressed I was the day I realized that you, who write’s so diligently about the ins and outs of clipping coupons, were actually from a wealthy, upper-class household. To me, for some reason, that made the whole idea all that much more interesting.

    I am an avid reader and big fan of your blog.

    However, I have to say I find these update posts fairly misleading. It’s great that you can provide such a lofty inspirational goal for so many of your readers but your frugality (or at least the frugality you promote) has to account for such a tiny percentage of your savings, here, that it makes me cringe when I see people attribute your financial successes to it.

    Your family makes a substantial amount of money, there is no getting around that. 7.2% of a home, even in the cheap mid west, is still I’d imagine a minimum of $10,000 in “savings” this month. Depending on your house it could definitely be much more.

    While it’s cool to see that having a large income, money in investments, etc, etc can net you significant growth each month (so long as you don’t go out and spend), I don’t think that’s really all too shocking and it definitely is not what your blog is about.

    I suppose the thing that just doesn’t quite sit right with me is that since your blog is called moneySAVINGmom and not moneyMAKINGmom a monthly update would seem much more appropriate if it provided an idea of what you’ve truly saved through the frugal means you promote in your posts. How do the tips you provide and live by get you closer to your dream of home ownership without debt?

    Perhaps show what percentage of this month’s total income was spent on groceries, bills, kids, entertainment, etc. I think those might be more appropriate numbers for your readers to compare, relate and strive to. The monthly percentage increase towards your house, while a very important number for you, really only makes sense to those in your same financial situation. I can guarantee you most of your readers are not.

    With all that said, please don’t get me wrong. I’m really not trying to be confrontational, only helpful. I throughly enjoy reading your posts and look forward to your awesome tips every day. I think it’s fantastic you guys are doing so well. It sounds like you have a happy, healthy family that will someday soon enjoy walking into a nice new home. I can almost see the eyes of your kids lighting up and I look forward to reading about it the day it happens.

    Money Saving Mom here: Eli, thanks for commenting! We’ve chosen–for a variety of reasons–not to make the specifics of our personal finances public information. When I did this before, I found that people got hung up on numbers instead of getting the principles of the matter.

    Truth be told, the principles behind everything I promote here are exactly why we are where we are today. Hard work, living on less than you make, scrimping, being creative, and being the best manager of the resources God has given you can lead to surprising things!

    We have certainly been amazed at how God has blessed and opened doors when we have sought to do the best with the little we have. It was only a few years ago–when my husband was in law school–that we were living on $1000 per month. I well remember those days!

    As our income has increased–through much hard work, wise stewardship, careful investing, and the blessing of God–we have sought to be good managers of that money through continuing to live simply and frugally, live on less than we make, work towards big goals, and be generous givers.

    Clipping coupons *does* make a big difference. In fact, I’d wager to say we have saved at least $15,000-$20,000 over the course of the last 6 years by doing so. And that’s a modest estimate. But it’s the principle behind clipping coupons (seeking to be a creative and wise steward of the resources which you have and living a disciplined financial life) which really makes the difference. And that is the vision I’m hoping people catch here. Once you catch the vision, amazing things are possible!

  5. katie says

    I live in New York City – and while I think your goal is wonderful, I don’t think it is practical for someone living in a place like New York. I am wondering if you are worried about housing price changes (I know prices have gone down considerably here – but they are still ridiculous). Considering you are at 65% now are you worried that by the time you save up 100%, prices may increase? I don’t know what the real estate market is like in your area, but some house prices in NY doubled in a 2 or 3 year period. That is one of the reasons that when we saw a house well below market value we jumped on the chance to buy (even with a RIDICULOUSLY large mortgage).

  6. says

    I’m very excited for you, what a great thing to be able to pay cash for a home.
    From a real estate agent standpoint, people who buy in cash are also in a great position to negotiate the price. When a seller can look at a calendar and know that in 7-10 days they can literally walk away from their home with some cash, most will not quibble over a few thousand dollars if it interferes with them having some closure and moving to their next destination. You won’t be required to get an appraisal but make sure you get one anyway, it’s well worth the $$. Good luck!

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