As some of you may know, one of the initial reasons that I started this blog was to vent some steam about my life as a debt slave. Our family’s huge pile of debt was divided between an underwater mortgage(my mistake) and several high-interest educational loans(my dear wife’s mistake). This debt was destroying my life and my family’s future. And as such, I had set myself on a course to pay off this debt, no matter the cost! As of this time last year, I had $177,889 dollars of debt to be paid. Today, I’m proud to announce that more than $91,000 (or over half) of this debt has been paid off! This has been a long, painful, and tremendously rewarding year. We sacrificed a lot, and we learned a great deal. As such, I want to share the details of our family’s trials and tribulations with everyone!
Firstly, I just wanted everyone to know that my wife and I are not people of great means. We both come from hard-working immigrant families . And while our parents have given us plenty of love and support, there was no monetary help of any kind.
I’m an IT guy, and my wife works in social services, helping children with special needs. Both of our day jobs pay very modest, middle-class wages. And because we live in the New York Metro area, the cost of living is sky high. To take good care of our baby son, even more of our modest wages had to be spent on diapers, formula, pediatrician visits, and an assortment of other expenditures.
So with that said, how did we manage to crank out over 91K of cash in just 12 months? That’s over $7,500 dollars a month, or WAY more than what we make at our day jobs. We achieved this not by robbing a bank or winning the lotto. Instead we did it by using the 2 Christian values that our immigrant parents taught us: THRIFT and INDUSTRY.
Living a Frugal and Thrifty Year
For the last year, we have been religiously following the frugality techniques of people like David Ramsey and Mr. Money Mustache. We both drive old used cars. I’m cruising around in a 15 year old Toyota, and she drives just fine!!!! Our gasoline usage is way down since both of us are using hyper-milling techniques.
On the food front, we very rarely go out to dinner, and we always take brown-bag lunches with us to work. And while the variety of foods that we eat has decreased, the quality has undoubtedly gone up. Much of our diet is now composed organic green vegetables, whole grains, and legumes. My backyard garden has been a great help over the last year as a significant source of nearly free organic produce.
We’ve stopped going out for entertainment entirely. All of our get-togethers with our friends are either in our apartment, in the backyard, or in the park. We no longer go on vacations or even road trips. Our vacations are now “stay-cations”, it’s way cheaper and less stressful.
All of our services have been reduced. We no longer have cable, our cell phones are running on the cheapest plan of the cheapest local carrier. The only splurge in terms of utilities is a single land-line phone. We absolutely need this in case of an emergency with the baby.
Every single one of our household expenses have been analyzed and cut to the bone. In effect, we’ve managed to recreate the frugal lifestyle that recent immigrants to this country have always had. Now none of this cost-cutting was easy. Sometimes it was down right painful. Once, we scored some 10 year old hand-me-down clothing for our baby. My mother found out about it and she cried. She told me that she came to this country to secure a better life for me, and now I living just like she did in the old country. But I told my mom that we WILL have a better life, it’s just a matter of getting through this rough patch.
So all of these frugal measures have dramatically reduced our expenses. We are saving anywhere between $1000-$1200 dollars of cash a month. While this was good, it was still not enough to make a dramatic dent to our debt. To really lower our debt, we needed to substantially increase our income.
A Mad Year of building Side Income!!!
So aside from the money we get by being frugal, we still needed to come up with over 6 grand every month to pay off that much debt. In this area, I really took charge. If you’ve read my blog from the beginning, you’ll know that 2 years ago, I lost a landscaping business that employed several people. I had devoted years of my life into building up that business, and the loss was a great blow to my morale.
I also had a house in another state with a substantial mortgage. The mortgage was part of our family debt and had a painfully high interest rate. This mortgage is now thankfully paid off.
So I was in a real bad spot 2 years ago, but it was not totally hopeless. I had gained many useful skills while running that small business. And because of these skills I was able to develop several streams of side income in the 2 years since that failure. My wife also started her own side business with just a little bit of tech support from me. Now since the Economy has been in the absolute dumps this whole time, it was not easy to build up these income streams. In fact, it was BRUTALLY difficult as I will explain in a little bit. But to give everyone an idea of how we were able to hustle up an extra $6,300-$6,500 a month for the last 12 months, here is what all of our small businesses combined earned in the last month:
- Apps and Scripts Business => $2,843
- House Rental Business => $1,710
- Online Content Farming => $738
- Flower Gardens for Rich People => $1,100
- Wife’s Ebooks => $621
Total Revenue for May => $7012
Now this revenue varies by month. Some months we make less, some months we make more. Getting this extra cash was no easy task. Every one of these side-businesses took tremendous amounts of time and effort to build. So here are some highlights of what I had to do to get these revenue streams flowing.
Apps and Scripts Business
I’m an IT guy by trade, so it took a modest amount of effort to learn how to build Smartphone Apps and Computer scripts. The trouble was that not every app can be a hit. In fact most of my apps make very little money. But every so often, I would build something that can make substantial amounts of revenue. Almost every weeknight, after I get home at 7:30pm, I would have dinner, play with our baby for 20 minutes and then proceed to work on this business until 1 or 2am. And then I need to be up by 7am the next day for the day job. This can get really grueling after a while.
House Rental Business
I thought renting out a house would be an easy source of passive income, but it turned out to be much MUCH harder. The problem was that the house was really designed for a single small family, and that would only generate about $900 in rent every month. So I had to basically re-work it to partition the place into 2 medium sized apartments. Renting out 2 apartments increased the revenue to $1500 a month. I did most of the re-modeling work myself to save money.
My rental house has a tiny backyard that really wasn’t good for anything. So I paved most of it over and turned it into parking lot. This parking lot is just big enough to fit 3 cars. The good news is that my rental house is close to a local train station, so I was able to pick up another $210 a month in revenue there.
Content Farming Business
I’ve always had a passion for writing. When it was time for me to go to college, my father made sure that I pursued a technical field. Still, I enjoy writing quite a bit. So this is more of a semi-hobby business for me. The good news here is that I need to commute by train into the city every day for work. So we are talking about a 2 hour round-trip commute. During this transit time, I’m writing article after article on my smartphone and saving them to be published after I get home every night. Most of my articles don’t make any money, but a handful of them have been generating cash.
Planting Flower Gardens for Rich People
Remember that landscaping business I had 2 years ago? While I may no longer have any employees, I still have 2 hands, a strong back, and 2 long days every weekend! So this niche business is a bit of a lucky break for me. For you see, I live within 15 miles of the ultra-wealthy West Chester County. Now within the New York Metro zone, many of the Rich Investment bankers, Hedge fund managers, and Executives own houses in “elite” neighborhoods within West Chester County.
From early Spring to early Fall, I plant flower gardens for the wives of these Wealthy Gentlemen. Normally, landscaping work does not pay that well. And while good horticulture work is a bit more complex than regular landscaping, the prices that I’m able to bill for my work is bordering on outrageous.
For a few clients, I’m able to charge $50/hr to plant some exotic flowers!!!!! Of course, I do many things to market myself as a highly experienced Horticultural “artisan”, this includes building a fancy website, having a portfolio, attending various events to get leads….etc. But still, the real reason for the high price is because the wives of the rich can be very competitive in terms of showing off their “status”. So I’m really happy to have this work, though at the end of the weekend, my bones ache real bad.
My thoughts on the future
The last year has been a highly productive one. Even though I’ve been working 90-100 hour weeks every week, the debt pile has been dramatically reduced. Now I can see that the end of my family’s debt slavery is in sight. If we can just focus ourselves and push hard for 1 more year, we will be free and clear! And even though I’m so very tired, I am very very happy. I have the support of my loving wife, I have the encouragement of my wonderful parents, and most important for all, I have faith that our Lord will grant my family the freedom that we’ve been fighting so hard to attain!