Mollie writes -
Well, the kids, Roger and Joy, are zeroing in on a home. They have viewed a bunch, ruled out foreclosures and short sales, gotten pre-approved, and have now narrowed their search to a place that seems perfect for them.
It ain't easy buying a home these days! When John and I were home hunting the first time around (1977), we were using the GI Loan offered by the State of Oregon for folks who had served their country. Although the usual mortgage rate was 6%, we were lucky to get a loan at under 5%. We were limited by the amount the State would loan us ($35,000!). So, we could look at homes within a certain price range ($35,000 plus the down payment). We ended up with a new home, a split entry with an unfinished basement. It had no appliances other than a stove, dishwasher and garbage disposal, so acquiring a refrigerator was on our list of priorities. We'd earlier bought a washer and dryer, so our appliance budget was spared that particular hit.
There was no yard, no fencing, no nothing. Upon moving into our home, we realized that our "new" home needed new, double paned windows. So, within months of buying a new house, we were buying even newer windows!
That first year we put in our front yard, started the back yard and just generally learned to live within our new budget. We seldom ate out, didn't go on luxury vacations, grew our own vegetable garden and planted fruit trees and grapes. We bought our clothes only on sale, and learned to decorate on a shoestring. We made do with one car, an old pick-up, and just generally counted our pennies.
Within a couple of years, we were sitting pretty and loving it. We'd finished the basement ourselves; saving thousands on labor, fenced the yard, and were learning to live on John's paycheck alone. We didn't care if we didn't have designer clothes, the latest in electronic toys, or a sleek new Beemer. We had a pretty little home with all the fixin's. Life was sweet!
In those years, I learned to stretch a buck until it screamed for mercy. I had to put up with a few derogatory remarks from family and 'friends' who questioned our money management (imagine, no credit card debt or car payments!). We eventually bought a used station wagon (this was before mini-vans) and even banked a little money. We were a source of amusement to our friends with fancier cars, bigger houses and oriental rugs. But we had faith in ourselves and our abilities to manage our resources.
We knew we were ahead of the game, but we had no idea how FAR ahead of the game we were. After 3 years of marriage, we were ready to start a family. And we knew, from our history of frugal living, that we could afford it without my income. We wouldn't be swimming in gravy, but we were solvent.
Over the years, we've had friends who have flirted with economic disaster. Some were unavoidable. Try raising handicapped children on a single income - having kids with 'special needs' usually requires at least one full time parent. But, frankly, most of our family and friends experienced economic hardship because they lived beyond their means. It takes a certain amount of intestinal fortitude to tell yourself that you can't afford something, but as time passes, this gets easier.
So, here we are in our decadent old age. We've saved money, lived on the straight and narrow and, son of a gun, are now enjoying the fruits of our thrift. But, frankly, we still pinch pennies (just not as much!). But we are here because of decisions we made as youngsters. And practicing thrift was one of the best decisions we'd made.
You hear a lot of talk about how bad our economy is. But those of us who manage our money, even in abundance, will survive. It just takes time, self-discipline and a little humility. You get to choose to do without "wants" in favor of "needs." And, you realize what constitutes a need.
It does pay off after 33 years. And, if time doesn't do anything else, it passes.
So, Rog and Joy, good luck. You've chosen a good home that will serve your needs for years to come. You'll be even better than John and I with money management, and will survive life's perilous roller-coaster ride. Just keep on keeping on. You'll be fine!