Ways to pay CASH – Part 1
November 2, 2008 by kellys
Filed under budget, debt/credit, financial matters, money saving idea
This is a guest post from a great friend of mine from up north. She is a mother of 14 and has done a bang up teaching her kids to live within their means and not to waste cash. I hope we can always learn from her example and live a debt free life. This week she tells us how her family was founded on paying cash and saving money before it was cool to do so.
My husband and I were high school sweethearts…we met when I was 15 and he was 19. We knew even then that we would marry and wanted many children, so we began to plan early on for our future. He had an excellent job as a diesel mechanic and worked long hours. I babysat evenings and was always fortunate to get full time summer employment caring for children. We both lived at home and other than the essentials in life, banked every penny that was made. Here’s where the part that most aren’t blessed with comes in…Between all our savings and monetary gifts our parents had banked for us instead of letting us spend them on frivolous things, we were able to pay cash for a small starter home. We lived way below our means…at a time when our friends were going into debt for bigger, newer homes, we remained in ours.
One of the first things we did was to figure out how high we could go with a house payment based on our income. We took that amount each month and faithfully deposited it into our account and just thought of as a “house payment”. When the amount was high enough we would invest in CD’s and have the interest redeposit into the CD rather than receive an interest check, thus compounding the interest and watching the money grow.
Every income tax check was placed in our savings rather than spent. Every time one of the children received a monetary gift, it went into the account. We kept ourselves debt free (lol…this was long before anyone heard of Dave Ramsey). With him being a mechanic, our car was well maintained and we always paid cash when a new one was in need (new/used that is).
Thank you Mom of 14 and continue raising frugal kids.
Stay tuned to next Sunday when Mom of 14 tells us how she saved money specifically with her babies and food. This series will hopefully culminate with college being paid for without student loans or debt. Stay tuned.
A great story! There was only one thing I didn’t agree with. When their children received monetary gifts it went into their house payment account. When my daughter receives money I believe that is her money. It was intended as a gift to her not my husband and I. Because she is only 3 I put that money in her savings. I think of it as her “car fund” so that she will have that money in there in her future for something she needs. Whatever she decides to spend it on, car, college, house, wedding whatever, but it’s her money. We do have a separate college fund set up for her.
the account we put the “house payment” in was not a house account but a college fund to be used to pay cash for all of our childrens’ college educations rather than have them start out life in debt with student loans. that’s why we would also depost any monetary gifts they received (they always received a lot of toys and clothes from friends and relatives for special ocassions and didn’t need any more). i’m sorry for the confusion…i’m sending things to kelly in bits and pieces!!!
Mom of 14, you are doing a great job! Don’t worry about it. We are all learning from you and will take all you can dish out to us. Comments are jsut for conversation and clarification. Keep sending us tidbits. We are loving it.