Financially stable with a young family

Sometimes when starting a family young (especially without university degrees) it can be difficult to make any sort of financial headway. There’s the cost of day care as well as navigating a relationship all on lower income wages.  You need to time to breathe and sort some things out. Here on this blog I like to promote doing like nobody else so later you can live like nobody else. So let’s dive into an unorthodox method to achieving some financial breathing room. 

Ask somebody, who has extra space on their property, for accommodations for your RV. In a sentence that’s litterly it, but let’s explore in detail below how you would do that. 

First you would need to determine the type of RV you are going to buy. You can usually find the larger travel trailers (over 25’) used for under 15k in excellent condition. You don’t have to buy the RV right away- you can wait until you have a place to park it. 

Next would be driving around the preferred neighbourhood (ideally large acreages) and leave renters resumes in the mailboxes of the perspective properties. Many of these properties are owned by older folks so you could offer to help maintain the yard and home for a reduced rent. Include a picture of your family, explain who you are and why you want to rent a space on their property (be creative with this part).

Likely all you would need is 110v power supply and water hook up (which just about every property has already). You could install a composting toilet in the RV eliminating the need for sewer hook ups. If you use natural soaps in the shower and kitchen sink then the gray water run off can fertilize some part of the property. At most I would offer $50-$100 for the utilities (bonus if they have wifi) and offer a certain number of hours a month to help on the property. 

Oddly enough people are doing this a few blocks from where I live. We have a relatively large percentage of older folks here on Vancouver Island (warmest place in Canada). As a result the extra help around the property is very much welcomed. We also have a lot of smaller farms that welcome the extra help and as a result allow free accommodations for your RV. This is common practice here in Victoria. 

With depreciation of the RV, water, hydro, propane, and maintenance, likely looking at $250 a month in housing with a used travel trailer. Keep the trailer in good condition and it will likely sell for 10-12k 5 years later. The young family wouldn’t need to own a tow vehicle. There are commercial tow companies that will tow the RV to its new home and the best part is- their commercial insurance extends to anything they tow (so don’t worry about buying insurance). Okay so now the housing costs are low at $250 a month. The spouse with the lowest income gets to stay home with the kids in order to save on day care costs. So now they have some nice tax deductible dependants at home (spouse and however many kids say two) 

So if one spouse makes $48,000 a year from employment, as an example, then with the tax deductible dependants (spouse and two kids) they would not pay any federal or provincial taxes. But wait the government will give them money to raise children through the Canada Child Benefit (CCB). A Family with two kids making under $48,000 will receive approximately $10,000 a year tax free. 

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Okay let’s recap, one spouse gets to stay home with the kids and keep the ship running smoothly so to speak. Housing costs are $3,000 a year. Income is 58,000 a year tax free.  That leaves a lot of room to breathe. The stress of two parents working full-time while raising kids is gone. This family has created financial breathing room and lots of it. 

Of course living in an RV long term is not reasonable to expect. But for at least 5-10 years while creating a healthy net worth and waiting until the kids no longer need daycare is wise. If the family can save $20,000 per year for 8 years that would be $215,000 at an 8% interest rate. Also if the lower income spouse could start a side business making an additional 25,000 a year (lots of tax write offs with a business which would minimally impact the CCB) to save then this family would have over $500,000 after 8 years. At that point this family has endless of options.

This example is mainly geared towards finding unorthodox ways for a family to succeed when income is limited. It assumes the family has access to at least 15k to buy an RV. Many Banks will provide 20 year loans on used RV’s that are 12 years old or newer. The idea with the RV is that it’s portable and provides more options in terms of where you live, but there are so may other house hacks out there. Maybe you could find a basement apartment to  rent that may not have a full kitchen or full bathroom etc. It may be partially finished,  You can barter with the landlord to fix up the rental suite and/or do some of the yard work for reduced rent. The idea is to not be afraid to put your self out there and seek opportunities.  

Happy Wednesday 

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