Sunday, 3 July 2016

Frugal budget - Home

Finding and establishing life on a frugal budget takes time.
The first step is to know the costs of the current lifestyle and the easiest way to start is to collect receipts and bills for expenses. 
These can then be divided, analysed and decreased in a multitude of ways.

Usually the first groping of costs has to do with the home.
Finding a place to stay is for most the most important decision in their lives.
For most it is a recurring task. Every physical move and most changes in life also involves a decision regarding where to live and what to pay for it.

The cost for a place to stay is therefore the first post in a budget. For many who live frugally, it is the biggest post in the budget.

In my way of calculating, the cost for my home also includes all costs that are directly connected to the home. For me it includes a monthly fee, electricity and home insurance (lowest possible, but more about that later). For most it includes heating, water, gardening services, repair services and of course the mortgage.
Since 2010 I do not have a mortgage although I had one when I bought my house.
(Since 2014 I also do not have the house the mortgage went with, but that is another story.)

It does not matter how you calculate the cost for your home, but ensure that you know each individual cost, and that you know how you counted it. I recommend a piece of paper. Buying special software to keep track of your finances is ridiculous as the whole point is to take personal control and to save money.

The costs can be annual or monthly; count each as an annual cost and then divide it with 12 to make them monthly. This is a budget! This is not the amount of money you need each month. The annual budget however, is the amount of money you need to have available each year to keep your home.

The next question is of course if you are going to keep your home the way it is now.

Personally, I could not have imagined selling my lovely house in 2010, and still by 2014 my life had changed so much that by then I could not wait to get rid of it. (Honestly, I have not even walked past it since the day I left.)

I pay for two homes. One in my mothers country which is my home; practically, mentally,  legally and taxationally, The other is in the man's country which is my home by invitation, choice and comfort. This is a very unconventional solution, I am fully aware of it, but before any conservatives advice on changes, remember that this works for us.
My home is also a safe, cheap, all-included studio with great neighbours. I pay less for it per month than most people spend in restaurants.

Without making any decisions about what the future will contain, you - yes, you, you and you - really should know the cost of your current home.


  1. I run a spreadsheet in Excel with every single cent accounted for. It is very useful, and as it has a forecasting component it is inspiring to see savings grow over time before we've made them. It heads off the desire to buy instant happiness!
    Your example is inspiring.

    1. No, you are truly inspiring (You are, No you are, no You are...)
      I only calculate and budget, I have never accounted for every cent (although not spending makes the bookkeeping easier).