Jun 5, 2014

How to Save Up for Your Very Own Homestead



So many people these days dream of having a homestead – a place where they can be more self sufficient and grow or raise their own food. But a large number of people I talk to are at a loss as to how to achieve this goal. Specifically, they think it's impossible - or nearly so - to get land to homestead on. There’s even a certain segment of this population who’ve come to believe that land is only obtainable if you’re rich – or get an inheritance. But I've talked to too many people who weren't rich, but were living the homestead dream, to believe this is true. So with that in mind, here are my top tips for snagging your very own homestead:

* Carefully consider your reasons for wanting to homestead. It's vital to fully understand why you long to homestead. Trust me; during the discouraging times, you need to know why you're scrimping and saving. For example, my main reasons for homesteading are: Higher quality, safe food for my family, and (eventually) a more rural lifestyle for my family. (I want my kids to be able to run around and play outdoors as much as they desire.)

* Consider what kind of homestead do you really need. Some people are happiest in the suburbs, where they can grow food, keep chickens, and tend bees. Others long to live more in nature, and have dreams of raising cattle. Try to be realistic here. If you've never lived in the country, but dream of a wilderness homestead, at the very least you need to spend a few months living in the middle of no where - preferably in the winter - before you sink your savings into a place you may end up hating.


* Check your credit history - right now. You'll need a report from each of the three major agencies: Equifax, Experian and TransUnion. By law, you can get one report per year for free. A good way to do that is to visit www.AnnualCreditReport.com. Read the reports carefully, and check for fraud, identity theft, or mistakes.

* If you don't have a credit history, like it or not, you will need one in order to buy a homestead. That means if you’re one of the few Americans who doesn’t have a credit card, now’s the time to get one. Then use it judicially to pay for items you know you already have money for - and pay the credit card off every month, on time.

* Unless your credit score is perfect, work on bettering it. The higher it is, the lower your monthly payments will be. (A score of 640 to 650 is considered the minimum standard for being able to buy a home/land. 750 or above is ideal.) How do you do this? Don't apply for new lines of credit. Pay your bills on time. Pay off your debts (it's okay to have a mortgage).

* If you're in debt, work hard to get out of it. Cut every bit of spending you can; it’s generally much easier to cut spending than to increase your income. If you need to motivate yourself, try pasting a picture of your dream homestead on your wallet, on your computer screen, or wherever you’ll see it before you make a purchase. You’ll also need to make a household budget. Be sure to browse the Dollar Stretching section of this blog for ideas on trimming your spending, and work on living without so much stuff.

* Save, save, save. Consider cheaper housing; I've heard of people living in their cars for a few months, to save a few thousand. This is pretty extreme – and not very practical or safe if you have children – but thinking outside the box and keeping your eye on the prize will go a long way toward helping you get your homestead. Consider every possibility: Every little bit extra that you have – even if it’s only a few dollars a month – needs to go into some sort of savings account. Every gift of money you receive, every bonus, every tax return. And while it may feel silly to deposit a few dollars in a savings account, over time, those little deposits do add up.
 * Consider other ways to bring in income. While you probably don't want to sink a bunch of money into a new business, could you start selling something on Etsy or Ebay? Is there anything homestead related that you could turn into a business now? (For example, do you grow enough extra food you could sell it at a Farmer's Market?)


* While you're saving and preparing, take look at real estate listings. Use a mortgage calculator, like this one, to get an idea of how much you can afford to spend on a homestead. Remember that there are lots of variables, though, including your credit score, how much of a down payment you can save (ideally, 20 percent of the cost of the homestead, though it’s certainly possible to do with less), and interest rates. Be sure to check different counties, too, since one county can have considerably higher property taxes than another. And don’t forget to allow for closing costs, which run from $2,300 to $4,000. 

* Look elsewhere if your real estate searches make you realize you can't afford a homestead in your current location. It's true that with cheaper land comes fewer jobs, but that doesn't mean it's totally impossible to find a job where land is less expensive. And if you can get an Internet-based business going, lack of jobs won't be an issue at all. (For great advice on starting such a business, I recommend Microbusiness Independence; it's only $2.99, but offers tons of great advice.)

* Consider free land. Yes, there are still places in the U.S. where land is free - with certain conditions (usually that a house of a minimum size is built on the land within a certain period of time). The reason these offers are available, however, is because the economy in the area is tanked and/or the weather conditions are harsh. Kansas has one of the more successful free land programs. There are similar programs in Nebraska, Minnesota, and Iowa.


* Consider alternative homesteads. Yes, I dream of a beautiful (preferably old, but restored) house on at least forty acres, but unless God drops that into my lap, it's not likely that's what we'll end up with. And that's okay. There are many ways to work yourself up to the homestead of your dreams; it's important to have an open mind when looking for land. For example, you might live in a camper or trailer on bare land, until such time as you can build a house. (Or you might decide living in a trailer isn't so bad - I highly recommend you read Trailersteading for a thorough look at this possibility.) Or you might have a smaller, older home in need of some repairs that you can gradually work on. Or you might need to reconsider your land needs. Could you make due with 5 acres instead of sixty?

* Homestead where you are. While you wait, you can still do some homesteading. City dwellers can plant pots of food on their roofs, balconies, and porches. Those in the suburbs can have bigger gardens, and maybe some chickens, rabbits, and bees. Everyone can read, read, read about homesteading. For more ideas, read "Homesteading Skills to Learn NOW."



The main thing is to not get discouraged. God has a plan for you. Focus on being in his will, and everything else will fall into place.


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