It was winter of 2011 and I was watching 60 Minutes one evening. They were featuring an interview with Dee Williams (pictured above). This is the first time that I ever heard of someone living in a tiny house on a trailer that is mobile. My eyes were glued to the screen. I was in awe of what I was seeing and hearing. As the interview unfolded, it was revealed (in case you have not heard this story) that this resourceful woman, Dee Williams, decided to downsize her life from her home of 425 square feet to her current house on a trailer with wheels of only 96 square feet. To summarize briefly, Dee expressed how she wanted to reduce her carbon footprint, simplify her life, and minimize her living expenses. So, she sold her home, obtained a flatbed trailer, and with some friends, built a tiny home of her own design. Dee explained how she is using solar panels, propane, and car batteries in order to provide basic utilities. Also, Dee described how she has an arrangement with a friend to park and live in her tiny house in her friend’s backyard for free.
One of the amazing points Dee made that really stuck with me is that by reducing her living expenses and downsizing her life into a much smaller space, she has been able to work less hours at her job and to spend less time on upkeep of her home, as it is much smaller than her other—all of this enabling her to pretty dramatically change her life style for the better. She talked about how she now has more free time, more savings, and can spend more time with her dog, her family, and her friends—and also she is able to take more frequent vacations and simply have more life. So, towards the end of the interview, Dee was asked how much the total cost of her tiny house ended up being and also the cost of her monthly living expenses. When she revealed her answers, my jaw hit the floor. Dee explained that it cost about $10,000 to build her tiny home on wheels and her monthly cost for utilities runs her $5 per month. When I heard this I thought that, after her initial, modest investment, her actual living expenses for basic utilities is simply a negligible amount of money. The wheels started turning and clicking in my head. Viewing this 60 Minutes segment was a life changing moment for me. I realized this concept of living minimally in a tiny house on wheels is the solution to my problem—my problem of how I am going to make it in this U.S. economy long term and have some sense of security into retirement.
COMPOUNDING INTEREST, PRETTY SCARY
I originally realized that I was facing a major problem in my life two years earlier. I was enrolled in classes in 2009 at my hometown community college. One day I went into my algebra class and my professor announced we would be calculating compounding interest that day. I had never really delved into how compounding interest works. It is not something that ever directly affected me. Actually, I am pretty sure that a great majority of U.S. citizens do not understand how compounding interest works, especially where mortgages are concerned. I continue… I had been a single mother for many years, struggling to raise my three daughters, renting, and I had never really made a major purchase that required my understanding of how these processes function. So, this day, the professor told us that in order to understand compounding interest, we would calculate mortgage rates.
My professor grasped a piece of chalk, raised his hand to the board, and began soliciting suggestions from the class. He asked us to suppose various houses we might buy, their purchase prices, terms, and interest rates. Some students suggested modest-priced homes: others suggested more expensive ones: some homes, more than $100,000, some less than $100,000—with terms of 20 or 30 years and some interest rates as low as eight percent: some as high as fifteen percent. The final numbers that we came up with shocked me to my core. No matter the original cost of a home, regardless the length of the term, or the interest rate, with every calculation we made, I discovered that the original cost of a home will go up by 33%, 50%, and sometimes even 100% or more by the time the term has been met and the home buyer has made the last payment. I imagined all the other possible costs involved with a mortgage, such as a possible second mortgage, home improvements, property taxes, and the cost of home insurance. Wow. Can you imagine if every major purchase you ever make is marked up by 33%, 50%, or even 100%? You simply would refuse to pay it. Why is it okay for banks to mark up the cost of a house like this?
On that day, I made a decision that I will never, ever in my life enter into a mortgage. I decided that this mortgage system seems like a scam on the American public and quite frankly, I cannot afford this kind of debt. I cannot imagine how any working class or middle class person can afford to just give away tens of thousands of their hard earned cash to banks in this way. It is illogical and leaves the illusory ‘home owner’ with not much to show for their money, except for a used home that usually depreciates in value and that can be taken away in an instant without recompense in the event of an unforeseen life crisis or during an economic collapse. So, I had a problem—what to do long term for a dwelling and as inflation grows and as wages stagnate in the United States, how will I survive? Will I have to pay rent for the rest of my life? I wondered.
THERE IS AN ANSWER
So, coming back to the winter of 2011….when I discovered the tiny house movement from the 60 Minutes interview with Dee Williams, I knew I had found my answer to this vexing problem. I realized that I could work hard, save up my money, and then I too could build my own tiny home on wheels, like Dee had done. Then I can better be in control of my own destiny—I can live even more minimally than I already do. I can reduce my carbon footprint: I can feel better about being a human on this planet: and I can have much better control over my monthly living expenses for shelter and utilities. This was originally a very reassuring and exciting prospect. However, as time went on, I was confronted with some hitches to my tiny living plan. It took me some time to fully digest this idea and fully commit to it.
MY TINY HOUSE OBSESSION BEGINS
The first challenge to tiny living that occurred to me is tiny living itself—with another. I am a single woman, but would like to have a life partner. I had to wrestle with this concept that I believe many tiny house enthusiasts grapple with—being a minimalist and also being in a relationship or even considering the prospect of a relationship as a minimalist. Most people that I talk to about tiny living just do not seriously consider it as a viable way of life. Recently I dated someone who was willing to listen to my ideas on tiny house living, but was not interested in actually doing it. This caused me to consider giving up on my tiny house dream, but only briefly. It took me some time to come to the conclusion that if I really want to keep away from the toxic mortgage system and if I really want to live within my means and be as environmentally conscious as possible, then I need to align myself with people who feel the same as I do about these issues. There are plenty of people who feel the way I do. So, I decided to make a commitment to my future tiny house life and my own happiness by only saying yes to possible life partners that want the same things out of life that I want, such as living in a tiny house. Really this is what I should have been doing in the first place. Once I reached this level of self-awareness, it made me feel much more confident about my own future, living affordably and sustainably in a tiny home.
The very next challenge to my tiny living dream is another issue that I think confronts many tiny house enthusiasts. I like to call this problem “tiny house procrastination” or “I will live in a tiny house someday syndrome”. Let me elaborate. Once I decided that I am really going to do this—build a tiny house and live in it, I immediately devoted several months, hours weekly devouring everything ‘tiny house’ that I could find on the internet in the form of videos, blogs, podcasts, websites, tiny house construction companies, making trips to home improvement stores, figuring the costs, drawing up countless floor plans, just looking at tiny house images, and the list goes on and on. I even purchased Dan Louche’s step-by-step video tutorial on how to build a tiny house from start to finish and watched it repeatedly. Once a felt fairly well-educated on everything tiny house, I realized I would need a bare minimum of $20,000 to $25,000 to see it through to completion and I would have to solve the problem of who, how, when, and where to build my tiny house. This was an intimidating prospect and I immediately relegated my tiny house dream to the back burner of my life and pressed forward with more immediate concerns, like finishing college and getting back to work. I continued to talk about tiny living frequently, holding the dream firmly in my mind; but really it was just collecting dust up there within my subconscious realm of fantasy.
So, I continued from winter of 2011 until fall of 2014, to fantasize about a life, tiny, for myself. I purposefully subscribed to some tiny house websites and blogs. I kept myself updated on tiny house news, tiny house plans, tiny houses for sale, and successful tiny house people stories. I continued to devote a generous amount of my time studying house design, interior design, home building, and of course, everything tiny. I read up on and reviewed every possible option I could find for each component of my tiny home—heaters, flooring, solar panels, toilets, showers, insulation, roofing, siding, interior wall cover, and this list goes on and on. I also turned into an insatiable visual scavenger, recording and photographing things everywhere I travel—as possible sources for my trailer, my tow vehicle, the components for my home, and also as environmental inspiration for my tiny house plan. Regardless of my efforts, my tiny house dream was not coming any closer to reality for me. Sometimes I even thought that maybe it will never happen. Maybe I should just give up and accept my poor fate in this brutal economy.
I RUN INTO A FORK IN THE ROAD
I got sick in the fall of 2014. It was not a serious illness; but it came completely unexpectedly. I thought I was a healthy 40 something year old woman, considering my pretty healthy diet of pseudo-vegetarianism, raw foods, and juicing, plus my anti-drug, holistic healing approach to my good health and my normal weight. I was experiencing stomach problems that I did not take seriously until I ended up doubled over in an emergency room more than once. My last emergency room stop, I found myself confronted by a surgeon who told me I needed immediate surgery. What happened after my surgery was the catalyst I needed to shove my plans for my future into high gear. This is what it took for me to stop and seriously think about where I am heading.
I had my surgery (gull bladder removal) and was home three days later, recovering. On the third day, I received a letter from my employer. They decided to cancel my medical coverage and make the termination of it retroactive, so as not to pay for my emergency surgery. This floored me. I also discovered that the short term disability that was available through my employer was only about twelve percent of my gross income. This was shocking as well, given this company is one of the largest and oldest logistics companies in the U.S. and Canada and actually pays pretty well. This might not sound like too much of a big deal; however I needed a minimum of three to four weeks off work to recover and this essentially meant for me, losing a month’s income. I had already lost some income being ill. This situation put a huge dent in my finances for several months to come. Fortunately, I had an old car that I could sell and also the support of my grown children. I understood in that moment that if it were not for my two oldest daughters who carried me during this crisis, I would have been out on the street or at the doorstep of another family member, asking for help. After I made a barrage of phone calls to various state and federal offices, trying to ascertain my rights and determine the legality of what my employer had done, I found myself, uninsured and feeling a victim of this system. Well, what could I do about it? Nothing, a lawyer told me.
After this humiliating and financially challenging blow, I spent the next three weeks in recovery thinking. I arrived at the following conclusions: I know exactly what I need to do, as this American Dream is not really working out for me. First off, I can go work for a better company. Done. Secondly, I can be less vulnerable to this system by having greater financial security through reducing my living expenses by 75% or more in a tiny house. By living tiny, eventually I work less and invest more of my time living and doing the things I really want to spend my time doing. I thought—why not change my life fundamentally starting immediately and rethink how I can live on this Earth—deliberately, being less wasteful, using less, needing less money, and simply living and enjoying the beauty of this world. So, during my break from the hustle and bustle of work life, I reflected. I took this unfortunate event that left me worse for the wear and I turned it around. I decided to stop dreaming about building my tiny home and just start making it happen—just do it. Here is where I started:
LET’S BEGIN…TINY STEPS
After some sorely needed rest and many extra walks with my dog, a solution for financing my tiny house just presented itself to me. I realized that if I wait and start my tiny home build when I save up $20,000 or $25,000, it will seemingly take forever and maybe my savings will keep getting spent on other things that come up along the way—but what if I could not access most of my savings because I already spent it on my tiny house? I looked at my debt: my car, my student loans, and my medical debt. I devised a more realistic and efficient budget, so as to free up more savings capital as I go along. I thought about little amenities that I spend money on often $10, $20, $50, $100 here, there. Each chunk of money that I sometimes spend unnecessarily—I imagined taking the same amount of money and just spending it instantaneously on part or one component of my tiny home—PAY AS I GO, my new mantra became.
So, I made a list of all the parts of my tiny home, all the big ticket items and all the medium and small cost items. I made a plan to simply start buying the pieces to my home that can be purchased in advance and to simply stow these items away and still continue saving money until I reach a point of actually beginning the build. For example, say I have $200 dollars to spare. I go out, I buy a kitchen sink: I leave it in its box: I stick it in my closet. A month later, say I have $300 dollars to spare. I go out, I buy all the boxes of tiles for my kitchen and bathroom: I stick them in my closet with the sink. Say I have $50 to spare. I go out, I buy a case of screws and I stick them in the closet. These items take up little room in my giant closet in my current 1000 square feet apartment. I think outside the box. By accumulating the components over time, this also gives me more opportunities for acquiring discounted or free things and simply scoring more bargains—because these bargains often present themselves over time and not all at once. In this way, I buy some things here and there: I stow them away and at the same time, I am saving for the big costs for my tiny house build. Also, as I accumulate my savings for the larger costs, I start knocking them out too. Say, I get up to $4,000 or $5,000 saved, I go out and purchase my trailer, bring it home, and park it. I know this might sound absurd to some. However, it is a realistic way to break down a large figure like $25,000 and make it more manageable over time.
I began to calculate a realistic completion date for my tiny house build. I drew my personal budget out over a twelve month period and determined how much money I should expect to save each month and how much I can save in one year. Then I simply took my target amount that I need to save for total cost of my home, $25,000, and divided this total cost by how much I think I can save each year, and came up with a realistic time frame. For example, if I think I can save $500 per month: this is $6,000 per year: and I reach my goal in just over four years. Or, if I think I can achieve the basic structural components and get into my tiny house for $20,000, I can achieve this in just over three years and complete finishing touches afterwards. Maybe some months I can save more. Maybe each year, I devote my whole tax return to my tiny house fund and I get there even more quickly. If I backslide and am tempted to buy something unnecessary, I just imagine how much time that purchase sets me back in my overall goal of building my tiny home. For example: say, I am tempted to buy a $500 computer that I do not need—that sets me back an entire month. Or I can imagine that, for $500, I can buy a water heater and a couple car batteries for my tiny home. I have to make the images real in my mind. Each month I am renting, I am just throwing that money away. So, spontaneous unnecessary luxury purchases literally cost me time and time lost is money lost and money lost is time lost and that is my life that is being chipped away by this materialistic compulsion, giving into bad habits that do not get me any closer to true tiny home ownership, to more freedom, to more financial security, and to the ability to live in a sustainable home that I design, a place where I really want to be.
Someone might play devil’s advocate and think that, well, what if you do invest all this time and money over two to four years and get halfway through your tiny house goal and then there is a crisis and you cannot finish your tiny house or you have to sell it and cut your losses? To that I say: if you do not start, if you never try, you never get there. I would rather take a risk and lose a few thousand dollars, rather than continue what I am doing now and just keep throwing away tens of thousands of dollars on rent.
When you view tiny house videos or read tiny house blogs, please do not be intimidated by others’ successes—be empowered by them. Please keep in mind that many of the incredible tiny house people you see on YouTube are not necessarily exceptional or very experienced carpenters or better off financially than any of the rest of us. They just happened to get there a little more quickly. These successful people probably implemented all kinds of creative, innovative, and resourceful ideas in order to achieve their goals of tiny home ownership—many of them did not necessarily have a bunch of money.
Please do not give up on this dream of tiny home ownership. Think about how you can make it happen for you. Throw out preconceived ideas and old cultural trends. Necessity is the mother of invention, I always say—be creative financially. Ask questions. Ask for help. Ask for free building materials and components. Ask your family, friends, and maybe even your co-workers to raid their garages, sheds, and basements. Surely someone has some unneeded stuff lying around they want to get rid of—that you can use for your tiny house build. Make it happen for you if you want it!
MY LAST THOUGHTS
Please—do the math—it is universal. Give this a try:
1) Figure some compounding interest rates for mortgages (or google them) and get a real feel for how much money it takes to try and buy a stationary dwelling today. Really think about how many hours you actually have to work in order to pay off a mortgage over what feels like a lifetime. Please ponder what a horrendous waste of your valuable time and money mortgages actually are…
2) Figure out how much you actually spend each year in total on rent or mortgage, electricity, natural gas, garbage disposal, and water. Get out a calculator, add it all up, and really look at how much money this is in comparison to your net income. Imagine how much you will not spend if you live in a tiny house, like Dee Williams. Imagine all the things you could do if money were less of an object in your life.
3) Please ask some of the tiny house people (the real ones on the internet) how much it cost them to build their homes and ask them how much their costs of living have been reduced by living in their tiny homes.
By taking a good look at the math, true cost of living in relation to income is brought into focus. This inspires me toward change. I hope you build a tiny home so that you too, can really design your life how you really want to live it, not subscribing to this fading American dream of perpetual debt and illusory home ownership that truly is a dream because it is not real for most of us.
Thank you for reading my condensed version of my tiny house story “so far”. Best wishes on making your tiny house dream come true. I hope I have been helpful.