This guest post from Clara is part of the “reader stories” feature at Get Rich Slowly. Some stories contain general advice; others are examples of how a GRS reader achieved financial success or failure. These stories feature folks from all levels of financial maturity and with all sorts of incomes. This story seems especially appropriate after the news I shared this week.
Two and a half years ago, my marriage ended. I left a comfortable financial situation and found myself one step above being eligible for food stamps. Money from our joint accounts paid for the down payment on my rental, but I also needed furniture, household equipment, and beds for me and my two children. The little things add up.
I found the tiniest little house to rent, priced well under market value (perhaps because it's only about 450 square feet). This little cottage has its charms, but it's very rough around the edges. Winter winds seem to shoot straight up from the crawl space. Still, it's cheap. And I have access to a yard and a garden, and the landlords and neighbors are nice.
I took a few things from the house I'd shared with my husband. Virtually everything else was purchased used from yard sales during the months before I left: kitchen knives, pots, lamps, towels, a TV. Even artwork and the shower curtain came from yard sales. The only things I bought new were the beds and the refrigerator. I started life on my own with no money in the bank at all.
Starting with nothing
The divorce was in mediation, which didn't seem to be going so well for me because I had no idea about my rights to marital assets. My car died, so I took out a car loan, my first debt in many years. My part-time job ended just after I signed my lease, and I couldn't stay in the house with my husband, so I just kept moving forward.
I found another better-paying, part-time job and made a hasty decision to go to graduate school. I wanted to get a master's degree since decent jobs were as scarce as hen's teeth then. I took on student loans to pay my in-state tuition costs and to buy a laptop computer that was absolutely necessary to be a student again (our only computer).
Meanwhile, my kids and I played board games and borrowed books from the library. I bought bikes, scooters, and other toys at yard sales. I was lucky in that my ex-husband was good about paying the spousal and child support, but there sure wasn't anything to spare.
We lived quite frugally, to say the least. I cut expenses to the bone.
Three years later
Eventually ,I got a raise at my part-time job, found a summer job when I didn't have classes, starting doing some tutoring, and sold things on-line as well. it was a tough schedule with two kids, graduate school, and everything else. But here I am, almost three years later. And there's money in the bank (a four-month emergency fund, plus I allocated the car loan money to a car fund account so I have something the next time I need to buy a car).
At first, I lived on $25,000 a year in a high-cost area (and, frankly, it's not much more than that now), but I still saved money.
- I saved enough to pay a divorce attorney.
- I saved enough to pay off some of my tuition to limit my student loan debt.
- I just retired my car loan. (I still can't figure out how I paid off that $10,000!)
I had an opportunity to become a graduate assistant; because I had so little debt and such low expenses, I was able to do it. Now my salary is minimal, but I'm getting free tuition and lots of mentoring from many wonderful professors. I will graduate in May and start to look for a full-time career in a couple of months. I'm aware that I may need to take a couple of part-time jobs instead.
Looking to the future
The divorce still isn't finalized. When it is, I'll be able to pay off my $16,000 in student-loan debt. Once gain, I'll be utterly debt free. I was able to leave my share of retirement funds untouched during the divorce, so retirement calculators tell me that I have enough to fund a very frugal retirement at age 67.
My kids and I are healthy and happy and sane. When the divorce is finally settled and I have a full-time job, I am planning to buy a house: a nice, small, affordable house.
It's been hard. There are nights when I sit with just one light on studying because I need to keep down the electric bill. But we always had enough for our needs, plus enough of our wants to keep from going crazy. I even got a scholarship to the local Y for me and my kids. Because I've lived a frugal life for several years, there's no prior debt at all, which of course makes everything much easier.
I never figured I could live so happily in such a tiny house with so little money. But I've learned that this freedom is the gift that frugality gives me.