How We Paid Cash for a Rental House

We paid cash!

A testimony from Jackie

We are determined to pay cash for everything — even big ticket items. So while my husband and I were getting completely out of debt, I set another long-term goal: to pay cash for a rental house once we were debt-free.

The plan was to buy the rental property within a self-directed IRA. (That’s a type of retirement account where you’re allowed to decide what you want to invest in, so long as you stay within the IRS rules.)

Small amounts add up:

I started contributing to my 401k at work. At first I just contributed 3% to see what my check would be like with that amount gone. Once I adjusted to that change, I increased my contribution by 1-2% every few months. I kept that pattern up until eventually I was contributing 30% of my check!

I invested in the options available to me in the 401k, and also got a very small company match. I had in mind that I would be quitting my job at some point in the (then-distant) future to go and work for myself. Once I did, my plan was to roll the 401k money into a self-directed IRA and then buy a rental house within it. The IRA would own the rental property on my behalf.

But before I could do that, the company I worked for was acquired. That meant I could roll the money over to a self-directed IRA earlier than I’d expected. I went ahead and did exactly that. Then I went house shopping!

Finding the house:

I had managed to save up about $80,000 over about 7 years, so I set my rental property budget at $50,000 or less. (I wanted to have extra cash available for repairs and unexpected expenses.)

In order to find a house for that low price, I had to look outside of our area. I found an older home listed at around $40,000 in a small town about 40 miles away. I had my IRA make a full-price cash offer, sight unseen, that was contingent upon inspection. (The property was occupied, and they didn’t want people inspecting who weren’t serious.)

After inspection, I had my IRA withdraw the offer. The house needed a LOT of work. I got a few estimates, and then had my IRA make a new offer at about half the asking price due to the repairs that would be needed. They accepted. Suddenly my IRA owned a rental property, and I’d paid cash for a house.


How it feels to pay cash:

The first time you make a large purchase with cash is amazing! So is every time after that!

Living a debt free life may not be considered “normal”, but it’s awesome — and something I believe everyone can do once they get their finances into shape.

We’re regular people who struggled with debt for years, and we finally beat it. You can too!

Jackie Beck is an entrepreneur and the mom of one college-age son. Her husband is a software tester and avid reader. You can read about how they paid off over $147,000 in debt at

Have you saved up and paid cash for something — large or small? Submit your story for possible publication here.

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10 Things I Learned From Downsizing Our Life


I posted about Small House Living earlier this week and introduced you to Lori and her family of six who are currently living in an RV. The comments on that post were quite lively and there were lots of pros and cons shared for both living in a small house and having a larger house.

Lori posted a follow-up post yesterday called 10 Things I Have Learned By Downsizing Our Life. I think you’ll find it very interesting and insightful — at least I know that I did. Head over here to read it.

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How I Saved This Week: Making coffee at home

Making Coffee at Home

I know it’s simple, but one way we save hundreds of dollars each year is by making coffee at home. You might feel like buying coffee really isn’t costing you much, but here’s what I wrote two years ago:

The Simple Dollar estimates that the cost of a 16-oz. brewed at home cup of coffee will cost you no more than $0.50 to $0.60 each, including the cost of energy, cream, sugar, etc. When I calculated it myself, I was coming up with the same costs for high-quality coffee. If you get a good deal on the coffee beans, your savings is going to be even higher.

So, if you’re typically paying $1.50 per cup of coffee, that’s a savings of around $1 per cup five times per week — or $20 per month or $240 per year. If you typically pay $4 for a fancy cup, you’re saving at least $17.50 per week, $70 per month, or $840 per year! Crazy, eh?

Making Coffee at Home

Not only does it save quite a bit of money, I also like coffee brewed at home the best. I can make my cup exactly like I like it. It’s almost like an art form to me!

We don’t really make fancy coffee all that often and we don’t even use sugar in our coffee any more around here, but we do love good cream. So we splurge on half and half every week. It costs us less than two cups of coffee at the coffee shop would cost us and it lasts us all week long — and it makes good coffee so much better!


Some Tried & True Recipe Links:


I was thinking about how much money we save by making coffee at home this week as I found myself brewing a delicious cup and pouring it into my favorite Copco cup before heading out the door.

And not only that, but it saves a lot of time waiting in line, too.

If you’ve been to a Starbucks any time recently, there’s a good chance you’ve waited in line for a least a few minutes, possibly much longer. Those orders of no-whip-two-pumps-extra-foam-double-cup-extra-hot-sugar-free orders take quite awhile to process. ;)

{Speaking of which, I was at the coffee shop recently and someone ordered some drink with a long string of names and instructions that included a specific temperature for the coffee to be. I was pretty aghast that that was allowed. I kind of just want to try ordering a coffee drink with instructions for it to be some random temperature — like 42.5 degrees or something — just to see what the barista says! ;)


For the record, I’m not at all opposed to buying the occasional cup of coffee, I just like it to be a fun treat, not an every day occurrence. Because once you add up how much it costs over time for “just that one cup of coffee”, it becomes a lot more motivating to learn how to brew your own cup of coffee!

What’s one way that YOU saved this week? I’d love to hear!

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Small House Living: Could you downsize in house?


I’ve been thinking a lot about the concept of Small House Living recently. My blogging friend, Lori, has shared about their family’s fairly radical decision to downsize to an RV and travel around the country as a family.

This in and of itself is impressive. But it’s even more impressive when you find out that they are doing this with four kids in tow.

Part of the idea of voluntarily downsizing appeals to me in a big way because I don’t like extra clutter and stuff. On the flip side, the thought of living out of a really small space sounds like a recipe for lots of tension. Namely, I like to have quiet places to retreat and living in such a small space might make me feel like I’d go crazy after awhile. :)


There can be a lot of benefits to downsizing, though, if even for a short period of time.

When I was 10 years old, my parents sold our house and moved all 7 of us (there were only five kids at the time!) to a single wide trailer for 7 months while we built a home in the country. Since our living space was very limited, we put most of our household items in storage and only kept out the essentials.

We have so many memories from that summer in the trailer, most of them good memories. And we discovered a lot of benefits to living in a small space. Such as:

  • We hardly spent any time cleaning. My mom divvied up the household chores amongst all of us and with only 6 total rooms in the trailer, that meant very few chores to go around!
  • It fostered togetherness. We couldn’t really go off by ourselves because there wasn’t a lot of space, so we had to learn how to get along even in tighter quarters! I have many fond memories of nights spent all together in the living room reading before bed.
  • We made our own entertainment. We weren’t able to bring many of our toys/things along, so we had fun using what we had for forms of entertainment. We built an elaborate tree “house” using things left in the old barn. We experimented in the kitchen with new recipes that only used the microwave, crock pot, or electric skillet (we didn’t have an oven in the trailer). And my older sister did a lot of sewing since she was able to bring her sewing machine.
  • We became more grateful. My parents were investing most of their money into the house-building project so there wasn’t a lot of extra cash that summer. I distinctly remember it being the first time in my life where we had to do without and I remember how much contentment and gratefulness this helped me develop.
  • It taught us the difference between a need and something that’s nice to have. There are many things we had to put in storage that summer that we’d always assumed you needed to live. But we realized that, if you can survive without it for 7 months, it’s probably less of a necessity and more of something that’s nice to have. It’s good to learn from a young age that there are very few real needs in life. I’m grateful for the conveniences of things like ovens and dishwashers and dryers, but you can survive just fine without them, as we did for those 7 months.


I was reading Kathi Lipp’s new book called Clutter Free recently and she talks about their decision not to move up in house, but rather to downsize in stuff.

She lists off a number of benefits for living in a smaller house, including:

  • Smaller houses are less expensive to furnish than larger houses.
  • Smaller houses are less expensive to heat and cool compared to comparably built larger homes.
  • Smaller houses force you to use all of your home.
  • Smaller houses force you to be intentional about your possessions.

I love her conclusion that, much of the time, we don’t need a bigger house, we need less stuff. If you’re feeling cramped in your space and like your family is bursting at your house seams, make sure you’ve eliminated all the unnecessary clutter and extras first before you starting shopping for a bigger house.

Have you ever downsized before — even for a short time? Do you think you could do what Lori’s family is doing and downsize your family to an RV? Why or why not? I’d love to hear!

For inspiration, check out this article: 12 of the Most Impressive Tiny Houses You’ve Ever Seen

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How to get a free washer or refrigerator from your utility company


Queen Bee Coupons shares how they got a free washer from their utility company:

When we moved into our house nearly five years ago it came with an older washer and dryer set. Although ugly, loud and inefficient – the washer and dryer worked just fine. We sometimes discussed buying a new set, but couldn’t justify the cost if the ones we had worked just fine.

Last month, my electricity company, Puget Sound Energy (PSE) reached out to me and told me about their PSE appliance replacement program – replacing old refrigerators and clothes washers – for FREE!

Seems too good to be true, but customers who are Puget Sound Energy electric customers (those living in Washington cities like Olympia, Kent, Bellingham, Bellevue etc.) and who have a clothes washer that is really old, like 17 years old or older, can exchange it for a free ENERGY STAR model.

Read more here.

Have any of you tried or done this before? I’d love to hear about it!

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Want to save even more? Do without.


Heather from Queen Bee Coupons has a great post up on saving money by doing without. Here’s a snippet:

When I decided to stay home with my kids (seven years ago!) it meant cutting our income by 60%. That’s right, 60 percent. Take $100 and throw $60 of it out the window. What was once $100, became $40 at the grocery store. I wouldn’t change staying home for a second. I wouldn’t trade anything for those extra 60 dollars, but I would be picky in how I spent the money I had left.

For us, this meant – if it wasn’t on sale and/or we didn’t have a coupon – we generally didn’t buy it. It was that simple. If it wasn’t a loss leader in the grocery ad (one of the best of the best deals), we would wait, and do without, until it went on sale.

And now, seven years later, our budget isn’t as tight – but we still live by this principle.

Read the full post.

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