Financial independence – FI

You know it’s time to move when you look through pictures of your home after you remodeled it and realize you’ve changed out most pieces of furniture.

My brother Phillip was in town visiting for the holidays recently and as usual we got into talks of our hopes and dreams. He showed us this amazing video of a man named Slomo in San Diego who rollerblades all day and night and is living his best, and happiest life.

The conversation then shifted to financial independence. Phillip asked if we had heard of the FI movement, and the answer was yes. Back when we lived in Colorado I remember reading Mr. Money Mustache’s blog a few times, as he was located just 15 min from where we lived, and I’ve always been fascinated by personal finance. I had also just read this NY Times article on the FIRE movement (Financial Independence, Retire Early). During this conversation Zach and I became acutely aware that we have gotten too comfortable.

Continue Reading...

Business planning, Buying houses, Debt Free Living, Fixer Upper, Investments, Move forward, Planning, Small living, Smart money, Uncategorized

We bought a duplex.

Back in 2016 we bought a duplex in Vancouver, WA. We went in on the purchase of this investment with my parents, and my brother and his wife. We started making a video of the process, but it was difficult to do because this property was already rented out on both sides and we didn’t want to invade anyones privacy.

This home is not the most beautiful, and it needs a lot of updating. We plan to make exterior improvements (I’m thinking some shutters, fresh door color, and removal of the awning would be a great start) as well as many interior improvements (The washing machine and dryer are in the kitchen so those need to be enclosed, replace carpet on lower levels with laminate, and fresh paint -goodbye cream!- would be the first items on our list) when the time comes for our renters to relocate. But we like our current residents, so there is no rush!

Continue Reading...

Business planning, Buying houses, Fixer Upper, Investments, Planning

Treat your tenants like customers.

img_7077

We’ve all heard the horror stories of tenants ruining properties by putting holes in walls, staining the carpets, refusing to leave a property at the end of their lease etc. This concern is what I would assume is the leading cause of people not being interested in owning rental properties.  Sometimes there’s nothing you can do to prevent this kind of behavior, but you can put the odds in your favor by treating your tenants like customers. Having rentals is a business, and with any good business comes great customer service.

Every single time we’ve met with a prospective tenant, we do our best to ensure that we want them to call us if something stops working or if they notice anything that needs attention. We do this for a couple reasons. 1. We want them to live in a place they love (the more they love it, the longer they will stay), and in order to do that they need to feel like they are being taken care of. And 2. These houses are investments for us! We want them to stay in good condition and don’t want something small to not get taken care of and turn into something huge.

We’ve looked at rental properties to purchase where the seller says “the tenants are amazing, they never call about anything, very low maintenance” and honestly, that’s a red flag for us. We’ve gone into several properties like this where it becomes evident that the tenants didn’t call because they just didn’t care about the house or they were getting low rent and were worried if they did call their rent would go up. Again, we want our tenants to call us, and you should want that too.

We’ve been extremely fortunate and have never had bad tenants. That being said, as with any business, you need to plan for unexpected things to take place. We always had money set aside in case something did happen to one of our homes and honestly, we planned for something bad to happen. We did this because we rental properties is our plan for retirement, we are in this for the long haul… so we planned for things to go bad so that if and/or when they did, we would be prepared and wouldn’t let it get us down. Luckily that never happened, and we like to think that a lot of that has to do with the fact that we treat our tenants with respect and are prompt to respond to their needs. Of course, there’s a lot that goes into finding the right tenants as well, but we’ll save that post for another day.

Business planning, Buying houses, Investments, Planning

Live within constraints.

Four years ago Zach spoke on Boundless Creativity via Boundaries, Constraints, and Limitations at Ignite Denver. He’s been saying it for years, and it still holds true today. The more we restrain ourselves, the more creative we are.

weddinglaughing

Look at us laughing at how little we spent on our wedding day!

I remember back in 2007 we had a budget of a whopping $2,000 for our wedding, including my dress! This is not a joke. My parents have always provided well for me and my 4 siblings, but they’ve never had a lot or money. Zach and I also had very little money. When we got married we were both going to school full time, and I was working as a Cosmetologist. So we had to make this budget work. If I remember correctly, I think we spent closer to $1,500!

Here’s how:

  • My dress was $400 (and the first dress I tried on).
  • We had our reception in the gym at our church which was free.
  • Our flowers for my bouquet and center pieces were roses from Costco (hello $24 for 2 dozen roses).
  • We didn’t hire a DJ, instead we used our iPod for a playlist.
  • My aunt made our wedding cake.
  • My mom made ham and turkey sandwiches on rolls for food, and had other small finger food.
  • Our photographer was a friend and I think charged around $300? (I do wish we had spent more here)
  • My friends from beauty school did my hair.
  • My shoes were from Payless.
  • I borrowed a necklace from a girl in College who I didn’t even know that well, but I liked it. Ha!

Continue Reading...

Debt Free Living, Small living, Smart money

Easiest way to save money.

Zach has been out of college and in the workforce for 8 years now. For the past 8 years he can count on one hand how many times he has paid to go out for lunch, impressive! Going out to eat for lunch is such the norm and most people don’t think twice about how much money they are spending. Based on the idea of paying $10 a day (which I wouldn’t be surprised if this number was actually higher) 5 days a week… you are looking at $200 a month. Now, what if you are a double income family, and both of you are eating out every day? That’s $400 a month!! Four. Hundred. Dollars!

So, if you can afford eating out for lunch every day, you can afford a house. If you and your partner were to pack a lunch every day for the next 22.5 months, less than 2 years, you would have enough money for a 3% downpayment on a $300,000 house. That’s right. Less than two years from now, rather than having nothing to show for your $400 a month… you could have $9,000 saved and be moving into your first home. Start packing!

 

Buying houses, Move forward, Planning, Small living, Smart money

New Airbnb in Louisville, CO

This last week I made a trip back to Colorado to visit our good friends (and our family Photographer) Ashleigh and Ian. I made the trip because they decided they wanted to rent out their spare bedroom on Airbnb. This was extra special because they purchased their house from us!  It was a lot of fun to be back in Louisville (although it was all of 36 hours) and get them squared away.

Have you ever considered renting your house out on Airbnb? Or, rent out a spare bedroom? Tell us about it!

Airbnb, Business planning, Debt Free Living, Planning, Small living, Smart money

Our Airbnb Rental. Sort of.

After years of considering and trying to find a way to have a full time airbnb rental. We have one! Kind of. As you probably already know by now, we are big Airbnb fans. We use it to find places to stay when we travel, and we also use it to rent out our home when we are gone. We. Love. It.

We initially thought about renting out our basement bedroom several months back, after we added a door in the laundry room. Having a second entrance made it feel like, why wouldn’t we do this? After a lot of excitement we ultimately decided that a few extra dollars wasn’t worth the hassle.

IMG_4862

Screen Shot 2016-09-06 at 10.57.23 PM

However, after being able to talk with other people who are also renting out spaces in their homes and really genuinely enjoying meeting the people who rent from them, we had to at least give it a shot.

Based on our research, we anticipated that we would make around $1,000-1,200 a month renting out our basement bedroom.. However, we posted on our instagram page about it and shortly after, our sister in law called. Her brother’s family had just moved to Tuscon from Portland right before her nephew’s senior year. And they had been looking relentlessly for a place for him to stay during his last year of high school. So we decided to rent the room to him. Room and Board- $400 a month.

Our kids love him and we think it’s going to be a good year! For now, Airbnb is on the back burner. Some day we will make it happen.

Airbnb, Investments, Small living, Smart money

Why we rent our house out on Airbnb.

IMG_7210

Just about every time we go on vacation we rent our house out on Airbnb. When we share this with people, it’s often met with disbelief that we would let people stay in our home while we are away. For Zach and I, it just makes sense. If we have a house that’s sitting empty, why wouldn’t we want to make some money to either subsidize our trip, or pay for it entirely?

This last weekend we went camping at Redwoods National Park. We spent about $60 on gas, $70 on campsites, $100 on food. We were gone for 3 days, 2 nights… and we spent a total of about $230. However, we rented our house out for those same two nights and we made $364. Renting our house out not only paid all our expenses, it left money in our pocket.

IMG_7441

Sure, it can be inconvenient. When we leave for a trip and are running around like crazy people packing for a family of 6 while simultaneously keeping the house spotless, each and every time we ask ourselves… is this really worth it? But no matter how much stress it adds we always come to the same conclusion. It’s worth it. We like that we trust in humanity. We like that we get to share our home with others. We also really like the fact that we come home to a clean house.

Renting our house out gives us the opportunity to go on family trips more often. We are able to make memories with our kids and hope that they will remember climbing on huge trees in the Redwoods and running around soaking wet in all their clothes on the beach and going on hikes in beautiful canyons. Airbnb makes life more fun.

Photo of our master bedroom by Red Aspen Photography

 

 

Uncategorized

Offer accepted… now what?

The house was listed at 218k, we were able to get it under contract at $203,029 which we felt was super awesome. However, there was no inspection contingency with this property. Meaning that we could do any inspection we wanted but we would not be able to get our earnest money back in the event we decided to back away from the house. (Earnest money is held by the title company and used towards your downpayment-usually 1-2% of the house price- but this can be lost if you walk away from the property.)

The bank sent us a purchase and sale agreement and we had 48 hours to sign it before the house would go back to auction and before we would have to turn in the earnest money. So… we used our time wisely and had the house inspected by my Dad and also made sure the septic tank was running smoothly.

When you buy a house, you want to know everything you possibly can about it before you purchase it. So inspections are critical. 48 hours is not enough time to get everything done, but we wanted to make sure the big stuff was good. And as it turns out, the septic tank was shot. Needing full replacement. After talking with several septic companies we found out that costs were anywhere from 8-15k and that doesn’t include redoing the lawn that was just torn out! You can’t get a full quote until the soil is tested and the system is designed, so this price range is all we had to go off of.

When you don’t have a functioning sewer or septic at a property… you cannot get financing. So, we went back to the bank with an all cash offer of $165,000 and they said no. We decided that this news of the septic put us over our comfort level with this house and we decided to back out. Luckily we did this all within the 48 hours and are now free and clear of this money pit! We are bummed because we are anxious to get a property and get it rented out, but we are also going to make sure that we make sound investments.

And icing on the cake is that the bank re-listed the house at 218k and didn’t disclose that the septic is not functioning. I feel like posting a sign at the property for the next interested buyers.

And now, the search continues!

 

 

Be decisive, Buying houses, Fixer Upper, Investments