Reducing the cost of living

Discussion in 'Financial Cents' started by oil pan 4, Jun 17, 2018.


  1. oil pan 4

    oil pan 4 Monkey+++

    Another form of self sufficiency.
    If you ever want to retire, get ahead, not work your self to death you are going to have to reduce your cost of living well below that of the general population or develope income streams that don't require you show up to work everyday.
    You can't always bet on being able to just make more money. That's relying on someone else to provide the money you need for everything (the text book definition of not being self sufficient).

    To reduce cost of living usually requires a fairly large up front investment that slowly pays back over time.

    So far I have identified a few points of attack. Reducing transportation, utilities and food costs.

    Reducing transportation costs was handed by out right buying my 2011 all electric nissan leaf when gas prices where near 6 to 8 year lows which was exacty when no one wanted them. This electric bastard car is replacing at least $50 in gasoiline per week with $10 worth of power per month. Pay back time should be around 2 years, if gas prices don't go up. If gas prices don't go up? Ha! (I wouldn't bet on it)

    Second would be using our well, the cost of this is going to total out some where over $3,000. Already spent $900 just getting the locked up agricultural pump lifted up, out of the hole.
    This will eliminate the $50 coop water bill, and replace it with about a $2 increase in the power bill. So about a 2.5 year pay back on that.

    Install solar. If I can install grid tied solar for about $2 per watt I can get the payback to be some where around 16 months. I'm looking at 3kw of panels for $1,600 and a 3kw inverter that's also about $1,600 to 1,700, I know that's only about $1 per watt, but I'm budgeting for an additional $1 per watt for the install. Every dollar per watt the install costs has a pay back time of around 8 months.

    I already started planting apple trees. The first generation of trees isn't really going to directly pay for its self by the number of apples produced but I an going to harvest the seeds and plant more trees.
    I'm also getting pecan trees since I already know they grow here.

    Next year we are getting chickens. What chickens provide is obvious. They can also eat up the bad apples and pecans so those don't go to waste.

    Pulling the old agg well pump yielded a few hundred dollars worth of fence building pipe which I have already started to use. The fence will help secure the apple trees and solar panels.

    The trees will be watered by the well which gets some of its power from solar panels which also charges the car that provides most of our transportation. This self sufficiency thing kind of builds on to its self.
     
    Last edited: Jun 17, 2018
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  2. ochit

    ochit Monkey+

    How deep is the well ?
     
  3. UncleMorgan

    UncleMorgan I like peeling bananas and (occasionally) people.

    Might consider building a few hives for your orchard. The honey bees make for you is the honey you never have to buy...plus it's worth providing bee housing even if you never harvest any honey.
     
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  4. oil pan 4

    oil pan 4 Monkey+++

    The well is 120 feet deep with water at 108 feet.
     
  5. SB21

    SB21 Monkey+++

    As soon as I pay off a few more bills , Which I'm going to do this year . I'll be able to live on very little money. i haven't sat down and figured out exactly what I would need as far as cash per month , but Its not much , as far as supporting the home and vehicle insurance. Next will be food . I don't have a big retirement plan , so I'll be living very frugally.
     
  6. Altoidfishfins

    Altoidfishfins Monkey+++ Site Supporter+

    Basically that's good strategy. So much of retirement planning focuses on cash savings and income, leaving outgo unaddressed.

    I'm retiring in a couple of months (will it ever get here?) and began by paying off the house - now. Was determined not to go into retirement while attempting to float a mortgage. That just caused hundreds of dollars a month to NOT go out in worthless interest for somebody else's benefit. When I later decide to move to the BOL, the house can be sold, rented for the income, or simply held and used as a getaway from the getaway.

    There are no car payments. A couple of the vehicles need work, but I'm knowledgeable enough and still able-bodied enough to perform even major repairs, given the time, which I simply don't have at the moment.

    The BOL will have lists of savings all its own, including zero utility bills in exchange for an up-front investment, as you were speaking of. It already has a well with an operating solar powered pump. Only thing the BOL should require in the way of utilities is cell service and internet - which one would have anyway.
     
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  7. duane

    duane Monkey+++

    The single biggest savings the average working man can make in his life are a good thermos bottle and a good lunch box. If you stop and have a cup of coffee and a donut on your way to work, a cup of coffee at noon, and one on the way home, with a donut, etc, with at least $10 spent, 200 working days a year average, $2,000 a year, 1 pack of cigarettes a day, $5 a pack, 365 days a year, $1,825 a year, eat out at lunch, $8 to 10 a day, another $1,500. Lottery tickets, a 6 pack of beer, newspaper, etc, most people spend another $5 to 10 a day. Use $1,500 for an average for a year and it totals to over $6,000 a year, now if both work it will be higher. I know from watching my neighbors etc that a good portion of the people with a family income of around $50,000 do spend that much, maybe a little less on food and drink for the women, but then since they work, they spend a little more on clothes and beauty shops, etc, and then there is child care expenses, a second car, etc. add car payments, eating out once a week with a good meal and a couple of drinks, mortgage payments, the vacation that you have earned, etc, education expenses, etc, and most people end up in debt for their whole lives and have little put away for retirement.
    It isn't what you earn, its what you spend and the small amounts, pack of smokes, coffee at Starbucks, diner at a chain restaurant , $200 a month for cable, internet and phone , new Apple phone ever couple years, all the dollar down and a dollar a day forever stuff is what keeps most people poor. I see the people living with their parents at 25, working at MickyD's for minimum wage partying on Sat night , drinking $4 beers and mixed drinks, and drinking coffee at Starbucks and just keep on walking. If you really want something, up to an including a cheap bug out location, get a lunch box, a thermos bottle, take left over food and coffee from home, don't buy the paper and lottery tickets, buy a 6 pack of beer, drink it home, stop smoking, drive your car an extra 5 years before you get rid of it, cut back on phone, etc, and in most cases in 5 years you will have $30,000 put away, I prefer greenhouse, silver, gold, no mortgage or car payments, etc, but your mileage may vary. Once you stop making payments, credit card interest, interest on furniture, car, etc, your savings multiply.
     
    Last edited: Jun 17, 2018
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  8. azrancher

    azrancher Monkey +++

    Really $900 to pull a pump up from 120', you know you can do that by hand, or a tripod and pulley system if it's too heavy for you, even with the steel pipe you can hand pull it. Put the new one back in with 180psi poly pipe, I've pulled mine from 100' by myself.

    $2 more per month on electricity for the well pump? Not unless you are not watering those trees, and are taking sponge baths.
    I put a GE electric watt-hour meter on my well with a Rockwell water meter and a cycle counter because I was evaluating a device called a Cycle Stop Valve (CSV), basically to make a long story short my well with trees, gardens, 2 people, 4 horses ducks, chickens, quail, partridge, etc costs $10/month in electricity, $20/month with the CSV ($.10/KWH Coop electric charge). Oh and the CSV will reduce your cycling to about half, but you will double your electric bill.

    You do realize that apple trees from seed will not produce the same kind of apples as the parent trees? You need to learn how to graft, the trees that you will produce will probably be crab apple trees.

    Good idea on the nut trees.

    Sell your excess eggs to your neighbors.
    Rancher
     
    Last edited: Jun 17, 2018
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  9. Ganado

    Ganado Monkey+++

    Great advice and much healthier to take your lunch and thermos


    a great thread @oil pan 4 you need to put 5 stars in front of it ****** and enter Moto's contest.

    This thread is worthy of much discussion and a win.

    I had a great outdoor garden before I sold the house. While growing the garden wasn't necessarily cheaper than buying the food, the health benefits more than paid for itself.

    Now I am trying to grow indoors, it's quite the challenge. Nothing like a good failure to look for some new way to grow food
     
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  10. Big Ron

    Big Ron Monkey+++

    I would go with a windmill kind of setup and eliminate the electric pump. I am always amazed at all the people I work with eating out every day because they are too lazy to make a lunch. Starbucks coffee is nasty. I can only guess people need that cup in their hand to somehow say they are cool like everyone else. Get out of debt is what I tell people.
     
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  11. DKR

    DKR Raconteur of the first stripe

    When we had all the kiddos at home, we made out milk from Dry, non-fat, non-instant milk. We canned our own jam as well.

    Once the mill was in hand, we would grind wheat and bake our own bread. This all saved money.

    How?
    Well you go to the store for bread or milk (or both) and always seem to come home with $100 worth of stuff yo hadn't planed to buy... It all adds up.
     
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  12. natshare

    natshare Monkey+++

    Put enough flavoring in it, and even the swill that Starbux calls "coffee" is palatable....to those that don't know any better! ;):whistle::LOL:
     
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  13. Tevin

    Tevin Monkey+++

    Wow, a lot of solid ideas here. But I do question some of your math.

    Spending $3000 on a well to save (net) $48/month is a payoff time of just over five years (not 2.5). And that does not include unexpected repair expenses for the well. What about wastewater? Do you already have a septic or does that need to be installed too?

    Solar: It is very difficult if not impossible to "make money" with solar. All these impressive stories you read about homeowners turning a profit by selling excess power back to the grid or by not taking from the grid to begin with leave out one key detail: They "make money" only because of accounting tricks, tax games, and forcing power companies to buy power they don't really need at inflated prices. These schemes are subject to the vagaries of politics and can change at any time. For example: The 30% tax break for new alternative energy installs was supposed to expire in 2018 but it was bumped out to 2020 at the last minute.

    You also have to factor in that your solar will not be producing power all the time. Every hour of no sun is one more hour your "payback" is extended. By your numbers, your 3 KW system will displace $6000 worth of electricity in just 8 months. Are you sure about that? In the real world there are very few scenarios where you can make electricity cheaper than you can buy it.

    I'm not trying to whizz on your idea because I'm a big believer in solar and use it myself. But you have to go into it for the right reasons, and saving money is seldom a good reason. I do not expect ever to recover the cost of my system, especially since I am off grid and have expensive batteries that need to be replaced every now and then.

    As for bringing a lunch to work, not hitting Starbucks every morning...right on! I have been lunch boxing it for decades. I'm not sure how much money I've saved but it's probably in the tens of thousands of dollars, although I've noticed over the years the "rate of return" is not what it used to be.

    There are many ways to save money and you don't necessarily have to live like a pauper to do it. Most of money management is really managing expectations.

    Thanks for the great thought-provoking post.
     
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  14. Ganado

    Ganado Monkey+++

    Last edited: Jun 17, 2018
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  15. ochit

    ochit Monkey+

    I went from 2200 Sq ft to just over 600 w/ 6 inches of insulation about a foot in the ceiling. and a good size shop
    Own outright taxes about 1/6th of previous per year and no monthly mortgage.
    electricity 1/4 of what I used to pay per month
    water less than half per month and I have a garden and numerous trees grape vines and berry bushes
    Demand water heater runs on propane all the hot water I need about 10 bucks a month
    kitchen range on propane power outage does not interrupt it's usage
    Area is better for vehicle insurance cost a 1/3 less more coverage
    internet is good speed 6gb cost about 40.00 a month
    got rid of my verizon phone service went with a good area service now text voice and internet 35.00 a month total
    got rid of cable as it was mostly social engineering crap, nowadays get a bunch of antenna channels '0' cost well the antenna was about 150.00 with the poles to get it up 30 foot.
    freedom 100% no HOA's no water district and taxes haven;t risen in 5 years can do more like raise a garden and animals
    buying bulk on a lot of things means I can wait on a sale i have plenty on hand and bulk up in season or on sale.

    If your willing to move, buy cash, reduce your footprint, improve your new digs for efficiency you can live pretty good on a lot less and gain more freedom I drive a hell of a lot less and fewer times I may go out 1 or 2 times a week I could go every day but I like my place. got plenty of friends and old friends are only a couple hours away.
     
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  16. oil pan 4

    oil pan 4 Monkey+++

    I'm planning on using a lot more water once I get the well going.
    I thought I mentioned that but it looks like I left it out.

    The house already has a septic tank and leach field. It was just inspected as part of the VA loan approval process.

    I already talked to the power coop about solar. They pay retail rate for power you sell to them. For what ever reason they are very excited about having more solar power generation added.
    Probably has something to do with not spending millions of dollars on another power plant and upgrades.
    I assumed the tax break expired and wasn't planning on using it since this will be a 100% diy install.
    I didn't say it would pay back $6,000 in 8 months, where did you get that from?
    That's crazy, if that's how it was everyone would be doing it and anyone not doing it would be stupid. The 3kw system is only going to generate around $1.50 worth of power, maybe $2 a day if I put the panels on diy trackers.
    Total pay back time on my system would be 5 to 11 years, all depends on costs, production and the bid/ask price of power.

    I only buy obsolete consumer electronics.
    My phone was 3 generations old when I bought it and I usually keep a spare one around. Because if you break yours and run to the phone store they will only have $500 to $1000 phones that they can give you right now. I'm looking to spend $250 or less and have it last 1 to 3 years.
     
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  17. azrancher

    azrancher Monkey +++

    DIY is a cheaper way to do solar, but your COOP utility won't let you connect it to the grid, if you do you will be looking at big time fines. They are very serious about you not screwing up their power grid.

    Rancher
     
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  18. Tevin

    Tevin Monkey+++

    In your original post you said "Every dollar per watt the install costs has a pay back time of around 8 months." I'm not sure what you meant but I take it to mean you expect the system to pay for itself in 8 months. I don't know how you did your math but I cannot fathom any situation where a solar power system will pay for itself that quickly.

    You can still get the 30% tax break even if you do it yourself. Just keep all the receipts. The tax break applies only to grid-tie systems. By the way, you'll also need a permit for your system. You can't just wire it up and plug it in. There is a considerable amount of red tape involved.
     
  19. arleigh

    arleigh Goophy monkey

    I use the grid for running the heavy stuff ,big air compressors welders, other shop equipment and refrigeration .
    The lights and most every thing else is on the "battery system" charged by solar wind and the grid if necessary. I have generators for grid down events .
    My electric bill ranges form $20.00 to $50.00 due to my equipment usage and I have others living here on the ranch ,
    I use a drip system for watering and caring for my chickens and though I wish I had a well I don't have the cash for it .
    My kitchen water goes into my garden and the septic tank takes care of the rest of the house.
    one of the people living with me insisted on having cable and internet so she is paying for it. If not for her I would be going to town to use some one else's y fy .
    Through the years previously I copied movies of the TV or bought them so I have a significant library of both DVD and VHS movies . and though there are movies available on line and such I prefer to own my own.
    Though I am not frugal when it comes to entertainment and I built my own solar /battery system it took years to develop and I think that's the key.
    Young people are impatient and expect to have a return instantaneously, But doing the right thing for the long run takes time .
    My system was initially built as a full time UPS because at the time the mountains we lived in had unstable electrical power , and they did not pay for damages due to their failures . Our first computer was such a large investment for us it was imperative that it had to be isolated from the system ,so it got power from the grid through a battery charger, through the battery, to an inverter, and then to the computer and monitor . That computer out lasted all our neighbors till it became obsolete .
    during that time I began exploring solar more seriously but finding panels was not that easy, and all I could afford were used panels, some of which are still in service .
    When it came to living off the grid I was ready and we did successfully for a while (4 years) . the wife thought living in town was better, but just a while back in town she was unhappy again.
    I personally love being off grid .
     
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  20. ochit

    ochit Monkey+

    I have a reason for the below information.
    Your well has a large enough bore to place in a smaller electric pump I would also if I had the means to put in a hand pump because your well is considered deep (over 30 foot) you would need a deep well hand pump.

    power is the one problem, if for some reason transmission lines are destroyed like in Puerto Rico and it's still not fixed so having a backup in place with your electric pump would be a good idea or at least consider the cost and consider the electrical pump size larger is not always better it all depends on your water needs and a ground tank for holding for garden use. Well this is like that farm game your decide your needs add the non electric factor for emergencies.
     
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