Urban homesteading

The physiological needs as described by Maslow include food, water, clothing, and shelter. Since these are the basic needs one must meet in order to survive they are the focus of my goal towards Independence. Now these may be met in numerous of ways. Some do it through employed work, investments, or by selling a product. A method that has always impressed me since I started reading about Mahatma Gandhi was self sufficiency. This is the method through which I would like to achieve my financial independence.

I do not think I will achieve the degree of self sufficiency that Gandhi has. For instance I will not be spinning my own cotton to make cloth. It is by far easier to live off societies waste. For example I can pick up a t shirt for 10¢ at the local thrift store and find a bottle to recycle on the way making the shirt free. I will however focus on growing as much food as possible on my land and paying off my house as quickly as possible. These goals will be more difficult to achieve considering the fact I life in an area that is rated a zone 3. Giving me only 3 months of growing time without frost. However, I plan to use season extenders to achieve a 4 to 6 month growing season. I also hope to do this with as little cost as possible.

Some books I have found helpful to this point include

How to Grow More Vegetables and Lazy bed gardening by John Jeavons

Urban Homestead by Kelly Coyne and Erik Knutzen

Four Season Harvest and The New Organic Grower by Eliot Coleman

Square Foot Gardening by Mel Bartholomew.

As for paying off the house. Once the Student Loan is finished (Aug or Oct 2009) I plan on making double payments towards the mortgage. This will be done with the extra money I have from the student loan payment as well as having an exchange student rent a room off of us. I figure since the house is my biggest financial investment this far it better start paying a return. It will do this by the food it produces and the rent I will make.

As of present my yard is producing the following goods: 2 crab apple trees ( I am planning on taking one out but am waiting for the younger tree to produce enough before taking the older tree out.) 2 apple trees different varieties and a plum tree. In the green house I have tomatoes and water melon. In the garden I have lettuce, peas, cabbage, carrots, onion, potatoes, corn, broccoli, spinach, collards, beets, pumpkin, squash, zucchini, buck wheat, raspberries, blueberries, strawberries, sunflowers, and beans. I am currently working on building a root cellar for storage of the goods over the winter. Items that don't store well will be canned or ate this summer. I will write more on my achievements as time passes.

Student debt

My student debt at the end of graduation was at around $28 000. My student loan was costing me interest of prime (5% at the time) plus 2.5%. Monthly interest payments were costing me $175 a month. In order to save on money I got a line of credit and payed the student loan in full. The best the bank could give me at the time was prime plus 1%. This resulted in a savings of $35 a month in interest charges.

However, I got to thinking how can I save even more on interest payments. This is when I came up with the plan to hold nothing in savings. My savings account did not actually consist of savings. It was were I temporarily held my pay cheques until I had to pay my bills. Earlier I decided I would buy everything I needed with my credit card. This way I would gain visa points but also get a period of time where I could collect interest in my savings account until my credit card payment was due. In order for this to be effective one must pay off the credit card in full every month. If one fails to pay the balance in full the interest rate charged from the credit company makes it not worth it.

By buying everything on my credit card I was able to hold onto my money in my savings account for an extra month and gain 3% interest. However, I realized that instead of putting this money in my savings if I was to store it as a payment in my line of credit I would be saving 6% in interest payments. This resulted in me saving even more money.

Let me provide an example. Say I spent $3000 a month on my credit card. If I stored it in my savings account until the bill came due I would have made $7.50 a month. However, storing the money in my line of credit would save me $15 a month in interest payments. Not only that I do not have to claim the savings as income like I would have to if I made the interest in my savings account. To ensure I never missed a payment, I postdated my line of credit to pay my credit card balance in full on the day that the payment was due as soon as I got my monthly statement.

So between these two methods 1 getting a line of credit with a lower interest rate then my student loans, and 2 buying everything with a credit card and storing all my income on my line of credit, I saved a total of $50 a month. Think $50 a month x 12 was $600 extra in savings. $600 a year equls 2 less days of work to focus on things outside of the formal economy.

This was the start of me looking at other expenses and finding little ways to chip away at them. If I could save $600 a year without it effecting me I wondered what other areas I could cut back and save. These small saving add up over the year and can result in thousands saved or hours of work. I will blog about some of the other areas I was able to cut back.

Ouch

Wanting to escape out of the formal economy is a lot more difficult then imagined. The system has ingrained itself so much so that it has built in parameters to ensure it continues. For example building reliance on vehicles, banning chickens from backyards, property taxes and so on. I have tried to cut my expenses down to a bear minimum but am limited by my duties to my family. This blog will talk about my journey as I attempt to escape the formal economy and make my way into the informal.

So many times I have found myself striving for more free time to work on the ethical and aesthetic aspects of life. However, due to the consumption drum I have always found myself called back into work in order to meet my daily needs. This blog is called better free your mind instead (stolen from the Beatles) because that is what I believe is necessary. In order to escape the formal work life one has to change their mind on what is needed. So much advertising bombards us everyday as to what we need. I believe it is about time that I tell myself what is needed.

Shawn