Hello! Here's an awesome post from my friend Emma. As you know, we recently downsized and we now live in our RV. Life is awesome!
In August of 2015, we returned from 15 months of travel through Mexico and Europe with our young son.
We saved hard throughout my pregnancy and were able to fund 15 months of travel with our savings.
However, eventually our savings ran out and we had to go home. Although the savings account was decimated, my attitude to life was completely altered.
I was hooked and wanted to make travel a core part of my everyday lifestyle. I came up with a slightly crazy goal of chasing the summer around the world, traveling for months at a time – between hemispheres, across oceans. Cruise ships. Train travel. Driving an RV across the US.
Wherever we wanted to go.
I knew we’d have to make huge changes to our life to pull it off but I was determined. Not only would we need to drastically reduce our expenses, we also had to build a business that was online so we could work on our own terms – and get paid regardless of where we were in the world. However, after time away from the workforce our retirement savings had suffered and we were moving back to a large mortgage which required a stable paycheck. Returning to an office job, whilst putting our son in daycare, in order to pay a large mortgage sounded like the complete opposite of my dream.
Not one to easily accept defeat, I kept thinking and reflecting. The solution came whilst my husband and I were discussing our return home over a cafe con leche in Spain. We always assumed we’d move back into the large bungalow we’d lived in before departing for our trip. The bungalow was rented out whilst we traveled and all of our belongings were in storage. However, after almost a year of living out of suitcases the thought of unpacking all of our stuff was overwhelming.
We knew that we could live a simpler life, as we’d been very happy traveling with minimal possessions.
We own a smaller, 2 bedroom 860 sq/ft townhouse that was purchased as a rental investment property. I suggested to my husband that we could move to the smaller property and keep the renters in the larger house. After all, the smaller house was still bigger than almost every hotel room and vacation rental we had stayed in.
After some number crunching, we decided to give downsized living a go and we’ve discovered it suits our lifestyle perfectly.
Drastically reduced expenses
All of our core bills have been slashed – we now have a lower monthly mortgage payment, lower property taxes, and much lower utility bills.
This combined with increased income from rent on the larger house nets us over $1000 per month. That means we can afford to maintain our lifestyle on my husband's income, allowing me the financial breathing room to build the business without the pressure of needing to bring in an income right away.
Related: How To Live On One Income
Potential Airbnb rental
One of the ways we plan to fund our travels is by renting out our house on Airbnb when we travel.
An older, larger house in the suburbs isn’t as appealing to guests as a more compact and well-serviced property, close to public transit and beaches. The house will need a full renovation – including a new kitchen, bathroom and dining room conversion – to be up to vacation rental standard but the work is not super-urgent. We can live with it until my business is bringing in more income.
Reduced cleaning time
Any person will tell you that trying to get stuff done – like build a business – with small children around is difficult. I want to spend nap time working on my business, not cleaning up.
Thankfully, I can now vacuum 80% of my house from one socket. We only have one (teeny tiny) bathroom to clean. Less time cleaning means more time working on my business. Saving time is as important as saving money for me right now.
We’ve actively decluttered by reducing our belongings down to the essentials and those which give us joy. It’s a work in progress but eventually, we hope to get to the stage where our personal belongings are able to be packed up in a day – and stored securely – so we could take off travelling and leave just the core essentials for Airbnb guests.
I’m committed to donating one bag of items to charity and listing one item of value for sale online each week. So far, I’ve made over $200 getting rid of stuff we don’t need.
Often smaller accommodation is found in more densely populated areas with better local services. This is certainly the case for us. We purchased the smaller property for $30,000 less than the cost of our larger suburban property.
Our new neighborhood is close to all amenities and is an employment centre with a lot of manufacturing and services. We have everything we need within walking distance which means we walk a lot. To the supermarket, the playground, preschool. This saves money on gas and other car expenses and is better for our health.
No long commute
We targeted the surrounding area when hunting for jobs for my husband and were successful in finding a position a ten minute bike ride away.
This is great because he gets home sooner which gives me more time to work on the business while he wrangles the boys. Plus, we can remain a one-car family which helps to keep our expenses down.
Our dream life is now within reach
I have a dream of chasing the sun around the world. That means we’d like to be able to travel internationally for at least three months of every year.
With two adults and two kids to pay for we require a travel fund of approximately $15,000 per year. To make that happen, we need to create a location-independent business and have our house generate income whilst we travel.
By downsizing our house and slashing our expenses, we’ve been able to align our financial reality with our dreams. I’m so excited to put this plan in motion and I’m hopeful a lifetime full of travel will be worth the tradeoff of having to share my (only) bathroom with three boys for the next 18 years.
Author bio: Emma Healey is a mother of two trying to find a balance between a life of travel and the pursuit of wealth. She writes about her goal of achieving financial freedom so she can chase the summer around the world on her blog Money Can Buy Me Happiness.
Are you interested in downsizing? Why or why not? How much money could it save you?