The tiny house movement has taken off, and for many it’s a 180-degree turn from society’s standard of more is more, especially where personal finances are concerned. Still, many are making the bold move into living tiny—some with the hopes that it will cut their expenses and move them closer to their financial goals. We caught up with a few tiny-home dwellers, who own and rent, to see if living tiny has actually cut their expenses and improved their personal finances.
Decreased housing costs from $1,500 to $15 (no, that’s not a typo)
For nine years, 37-year-old Ryan Mitchell, managing editor and owner of A Tiny Life, of New Hampshire has been living in a 150-square-foot, self-built tiny house in North Carolina. His tiny journey began in 2009, during the economic recession. After a company-wide layoff that left many of his coworkers wondering how they’ll pay rent, he began reevaluating his life.
“I knew I needed a change—a drastic change—one where I could take control of my life and its destiny. I soon found tiny houses and realized the potential,” he wrote on his blog.
It took four years for Mitchell to realize his dreams of owning a tiny house—18 months of which were spent on the build. The rest of that time was spent working hard and tackling his debt. In 2012, he built his dream home.
Since then, his financial situation has changed drastically. His rent, utilities, insurance and other housing costs went from $1,500 a month to $15 per month. He installed solar panels and gets his water from the city. “That was seriously life changing,” he said. “After moving into my tiny house I paid my student loan off in less than one year.”
But that’s not all. His expenses got so low that he was able to quit his job and work for himself. As his own boss, he’s been able to travel extensively while working. He was even able to stay in Croatia for 3 months and check living in a foreign country off his bucket list.
His lifestyle has resonated with many Tiny Life readers, and he’s helped build well over 3,000 tiny houses for other people. Here’s his advice to people wanting to use tiny living to transform their finances: “Realize cutting out lattes isn’t going to cut it. You’re going to have to make big moves. Look at the largest line items of your budget and work on reducing those, even if it’s temporary. While you’re doing that, also work to increase the income side of the equation,” he said. “Remember that a tiny house can be your forever house or a stepping stone to a debt-free future.”
Financial expert Anthony O’Neal also believes in living a debt-free life and understands why so many people, like Mitchell, want to pay off debt and save money. “People are tired of living paycheck-to-paycheck,” O’Neal said. “They are tired of going to payday loan apps and borrowing money. They want peace, joy, options and wealth! Debt robs us of all of that.”
Traveling debt-free as a family of five
Jacq Marines lives in a 300-square-foot skoolie with her partner Marc Marines and their children Wren, Rogue, and Rebel Grey. Money wasn’t their primary motivation for living tiny; they really just wanted to travel as a family. Still, living tiny has had a positive impact on their finances.
“Alternative living has saved us money in a lot of ways, such as not having to pay a mortgage, utilities and all the other stuff you hate paying for,” Marines said.
But that didn’t happen overnight. Because they have children it was important to have financial stability while they lived on the road. So, much like Mitchell, their number one priority before living tiny was to pay off any and all debt.
“Once that was done it freed up a lot of money for our bus build, money for our savings, and it gave us the freedom to travel when it was finished.”
To keep up their lifestyle, Marines and her husband established multiple active and passive income streams, including OAK + PINE, their tiny-home building company. Her husband also works for the state of Oregon and they own a rental property.
“Had we not been brave, the opportunities and the financial easement tiny living has brought us would have never happened,” Marines said.
They love their nomadic lifestyle and how living tiny allows them to sustain that. In fact, they started their second bus conversion to downsize for more adventures on the road.
Living in an expensive neighborhood without the expensive price tag
For self-employed knitwear designer Denise Bayron of Bayron Handmade, finances had everything to do with living tiny. She currently lives in a 280-square-foot accessory dwelling unit in Oakland, Calif.
“Living tiny grants me the privacy and comfort of a detached house, but without the heavy price tag,” she told The Spruce. Average home prices in her neighborhood are about $1.5 million, she said.
“As a woman of color with no generational wealth, I cannot afford to buy a home in this city,” she said. “Renting my tiny house gave me access to a safe neighborhood with many amenities, such as shops, cafes, book stores, etc., while still living within my financial means.”
It also gave her financial stability while she grew her knitwear business, which she runs from her home. Consolidating her tiny house into a personal and professional space caused her to reflect on every purchase, helping her to distinguish between her needs and wants.
“Living that intentionally has resulted in my spending less, saving more and overall improving my financial standing,” she said.
She’s now able to comfortably meet her housing costs while saving money to eventually buy a property of her own. ONeal says this is a pillar of wealth-building and can provide even more control, options and stability in our finances.
As a 44-year-old, Bayron has seen many of her peers resort to having housemates — an option she’s avoided with tiny-living. “I may have limited space,” she said. “But it’s all mine.”
Tiny homes had largely positive impacts on personal finances
By relieving them of high housing costs and forcing them to reevaluate their spending, these tiny-house dwellers have been able to save money and even pay off debt. However, the greatest benefit of its financial impact is evident by their lifestyles: self-employment, debt-freedom, higher savings, travel and enjoying amazing experiences with loved ones.
The overwhelmingly positive impact on the finances of these three people who shifted to tiny home living makes sense when you consider the cost of a tiny house. According to an analysis by Porch, a software and service company in the home services industry, a tiny house costs 87 percent less than a full-sized house. The lower up-front price tag and maintenance and utilities costs is one of the primary appeals of tiny house living. Of the people surveyed by IPX who said they would live in a tiny house, 65 percent cited affordability as the biggest draw to the lifestyle.
Disclaimer: Curated and re-published here. We do not claim anything as we translated and re-published using google translator. All images and Tattoo Design ideas shared only for information purpose.