How to Be Financially Free – Tangibles Investing in an Uncertain Future – Part 3

If you are a student on the verge of graduating from high school or who has just graduated from high school, (or anyone who desires to live a happy and financially free life), you don’t need to go to college in order to find financial security.

This article will show you how you can skip college altogether, and the extremely high student loan debt that comes with it, and secure your financial future better than if you go to college.  Instead, consider a different path that can lead to greater financial security at a much earlier age, even in times of double-digit inflation.

I’m going to let you in on a big secret:  unless you want to be a doctor, lawyer, engineer, physicist or other education-intensive profession, there is absolutely no compelling reason to attend a college or university right out of high school.  There’s a phony statistic floating around that says people with college degrees earn on average 1-million dollars more during their lifetimes, than those with just a high school diploma.  This is no longer true, especially in this time of pandemic and the so-called Great Reset.

In fact, since late 2007, the United State’s economy continues to crumble.   Jobs are being outsourced overseas and overseas workers are being brought in to take jobs from native-born Americans, making it even harder for new college graduates to find work.  Almost half of ALL college graduates can’t find jobs that pay more than $15 an hour.  Even with a bounce in wages since the COVID-19 lock downs, according to an article in The Atlantic, it is reported that upwards of 61% of recent college grads are still living in their parent’s home.  Since 2020 and the pandemic, that percentage has only gone higher.  Nearly every reputable economist says it will stay this way for the foreseeable future, with inflation destroying the buying-power of our wages.  One simply cannot lose a decade of earnings and ever hope to recover enough financially to make an impact over a lifetime.  That is why you must chose to change your future by choosing a better path.

It is plainly evident that college graduates are being hit now with a double whammy:  crushing student loan debt and double-digit inflation.  Compared to others of their high school graduation class, they start life under a heavy debt burden. Add to this the double-digit inflation, they are no better off than others who immediately struck out on their own and began working towards a different goal.  How can college graduates earn a million dollars more than those with only a high school education under current economic conditions?  How they can earn that much when they also have to pay back crushing student loan debt?  Most are looking for work and doing side gigs to simply stay afloat.  They are treading water and are one poor decision away from drowning. 

In fact, the student loan debt crisis threatens more than just college students, as financial institutions will not make risky loans to others who cannot show how they will pay it back.  This further erodes the economy and forces all taxpayers to pay for loans not being paid back, as well as footing the bill for the loans in the first place.

In such a confusing economy, the only solution is to commit to a financial plan that will instead give you more financial freedom and choices. 

The KEY to being financially free is to eliminate as much of your largest recurring monthly expenses as possible.  This concept is so important, I will repeat it:

The KEY to being financially free is to eliminate as much of your largest recurring monthly expenses as possible.

Previous articles have shown how you can invest in tangibles as a hedge against inflation, and how learning to cook from scratch can help find the money within your existing budget to pay for your tangibles investment.

I’m now going to suggest that the biggest tangible you can ever invest in is a house owned free and clear. 

Since the cost of housing is the single largest monthly expense for most Americans, by reducing or eliminating this expense, you can spend that money on other things.   You get to keep that money and leverage it to your advantage. 

Instead of going into debt right out of high school, why not create your own 4-year plan with a goal of owning your own home at the end of 4 years?  

The goal of home ownership is a good one because most Americans pay the largest percentage of their monthly income towards housing.  Your goal is to eliminate the cost of housing as your largest expenditure in the shortest amount of time possible, rather than incur crushing student loan debt.  You have a 4-year head start towards the same goal as your college-bound friends.  Why not make your a reality in the same time it would take to complete a Bachelor’s degree?

How to Get Started in Four Steps

Here’s how to achieve your own 4-year plan:

1. Get a job
2. Save as much $$$ as possible so you can
3. Buy a house and own it outright within 4 years. 
4. Commit to this goal!

Here are several examples of how people just like you managed to do this on modest incomes. 

If you find your income is less than these examples, then you will need more time to accomplish the plan and you can adjust your time line.  If your income is higher, you will need less time to complete your plan.  It doesn’t really matter how much you earn, because what matters most is your determination to complete your plan!

Tom’s Mother and Father divorced when he was 8 years old.  Now he is 18 and soon graduating from high school.  His mother Judy, works as a secretary for a title company in the suburb where Tom, his Mom and his sister Kristine live in an apartment.   

Judy income is only $2,000 a month before taxes and Social Security are taken out of her wages.  Her real take home pay is $1490 a month.  She rents a 2 bedroom apartment for $875 a month.  Her children each get their own bedroom while she sleeps on a pull-out sofa bed in the living room.   Her utilities cost her $250 a month which leaves very little money left for groceries, insurance and travel to and from work by car.  

Tom has been contributing to the household for some time by doing a paper route and mowing lawns.  His monthly income averages about $150.  Now that he is 18 and will be graduating high school soon, he wants to help his Mom even more by NOT going to college.  He wants to expand his lawn care business and go full-time.  He also earns extra money during the winter off-season by harvesting firewood and selling it by the cord and smaller bundles to families around town and in a nearby city. 

Tom agrees to pay rent for his bedroom to his Mom at $300 a month.  His rent includes all his utilities and food.  This helps out Mom because she is getting an extra amount every month to help with bills and Tom benefits from having a goal to reach and achieve each month, learning financial responsibility.

Tom has already managed to buy a used pick-up truck and save $300 from his part-time jobs, which he uses to launch his lawn care business.  He knows how many regular customers he must have in order to earn what he needs to earn in order to pay his rent every month to his Mom and meet his 4 year plan goals.  

In March, before he graduates, he has some business cards printed, advertises his lawn service in a local publication and has his business name and phone number painted on the cab doors and rear tailgate of his truck.  Additionally, he promotes his business to his existing customer list, not only to find new customers among their friends, relatives and neighbors, but to sell add-on services they may need, such as trash hauling, tree and shrub trimming, preparing a garden for planting, edging and landscaping.   This helps to increase his profit per customer.  

Using these simple methods, Tom quickly builds his business to earn $2300 a month.

On the weekends, Tom and a friend gets permits to harvest firewood from nearby US Forest Service lands, haul it back to town, where they split it, stack it in covered shelters and then sell the seasoned wood; (his sister sometimes goes with him and she collects hundreds of pine cones, which she sells on eBay and Etsy to crafters).  Tom earns an additional $3000 from this activity during the off season from his lawn care business.

Here is Tom’s monthly budget:

• Gross wages                               $2300
• Savings                                      $1200*
• Rent to Mom                               $300
• Upkeep on lawn care equipment   $40
• Upkeep on truck                          $50
• Gas                                            $100
• Vehicle Insurance                        $90
• Misc.                                          $520

* Tom’s savings and misc. amounts also cover his quarterly federal tax filings, of which he gets most back at annual tax time when he does his taxes.  Any tax refund he gets goes into his savings to be used towards buying a house.  Tom’s firewood side business income also goes into savings.

In 4 year’s time, Tom saved $69,000.  He would have saved more money but for two mechanical emergencies involving his truck and a trip to the emergency room for a bad splinter he received while working.  Instead of a stick-built house, he decides to buy a  newer but used 3-bedroom 2-bath double-wide manufactured home in a safe and friendly family mobile home park in town.  The space rent for the home is $350 a month.  He is able to buy this entire house for $35,000.  Once Tom and his family move into the home, their monthly housing costs drops to cover just the monthly space rent and home insurance, which he splits with his Mom.  This allows his Mom to live much more comfortably on her own income, save more towards her own retirement and help his sister Kristine with college, if she decides to attend. 

Tom makes a few upgrades on the home which costs $4000 and they move in.  At the end of 4 years, Tom has:

1.  Bought a house and lowered his family’s monthly housing cost dramatically;

2.  Improved the quality of life for his family as they get a much larger home and small yard; they each get their own bedroom, and they have more living room and kitchen space with a pantry; and

3.  He still has $30,000 in the bank as an emergency fund for the house upkeep, business-related and personal needs;

4.  Because his housing cost is now a fraction of his monthly income, Tom can save even more money from his income (adding to what he still has) and by helping his

Mother, she also has more money to save and invest from her monthly income;

And most important of all…

5.  Tom has no debt.  He owns his house free and clear and is in a position financially to have more options available to him such as expanding his business, or buying into another business, or taking some courses to help him run his business better, etc.  The sky’s the limit!  He’s his own boss and can take time off when he wants to and has the cash to really enjoy life. 

All of this was achieved because Tom made a plan and was determined to stick to it, in order to achieve his goal of home ownership.  He spent his savings wisely by the outright purchase of a home, instead of merely using the money as a down-payment on a home.  Tom chose to buy and own a house free and clear because it dropped his monthly housing cost to about $400 a month (mobile home space rent plus home insurance).  If he had purchased a stick-built house, then the cost of the home would have been tens of thousands of dollars more expensive and the resulting mortgage payment would be $1200 or more, and a much higher property tax bill. From the standpoint of how much money Tom gets to keep each month, instead of having to pay, Tom is way ahead of the game! 

Tom’s mother was able to quit her secretarial job and start working for her son.  She now works for her son Tom.  She schedules his work, assigns daily tasks for his work crews, markets the business to new customers, and does his billing and bookkeeping.  This frees up his time to train employees, and start bidding on larger projects. 

Eventually, Tom landed a lucrative, long-term contract to do grounds maintenance for a local business industrial park and is branching out into providing janitorial services for these businesses as well as lawn care.  Tom is now on track to build his two businesses up to the point where he can retire before age 40 if he so desires, all the while living a much less stressful life free from financial worries.  Tom credits the key to his success was his initial 4-year plan to buy a house free and clear.

In a word, “No.”  Many people are able to find existing real property homes (homes that come attached to land) for under $60,000.  They may not be the newest or nicest homes but they can be lived in and maintained and if you buy in the right locations, such a home can be sold for more money than what you originally paid and put into it.  One man has created an online cottage industry about finding and buying home for $50,000 or less, here:  http://www.housesunderfiftythousand.com/affordabletowns.html

In fact, if you do a search engine search for “homes for $50,000 or less” you will find untold numbers of available cheaper houses for sale.  Just remember, you will be buying older homes that will require more upkeep, adding to your cost to live there.  But think of what you can do with the larger yard space that typically comes with older homes!  Most of the older homes in small town America come with a 20th of an acre or larger yard, because back in the day, people typically had large gardens, lots of kids who needed space to play, and oftentimes kept chickens and even their own dairy cow.  If you can find a home that you can buy free and clear with the money you save in four years or less, and carefully budget for upkeep and upgrades going forward, you too can reach financially security and have no debt.  

Here’s how one gal did just that.

Sarah lived at home with her parents in the suburbs.  She decided not to go to college after high school.  Frankly, she was an average student and was simply tired of school.  She wasn’t really sure what she wanted to do but just knew she wanted to enjoy life, travel and not be tied to a 9 to 5 job.  Her best friend Kathy decided to attend college because she wanted to become a teacher.  More about Kathy later.

Although Sarah wasn’t sure about the direction of her life, she did understand that she wanted to make the next few years really pay off so she would have more options and be able to do the “non-work” things she dreamed of doing.  So she devised a 4 year plan to buy a house to at least have a home already paid for which she could never be put out of and for her work to be home-based for whatever direction she pursues.  While her plans seemed vague, she actually committed herself to doing whatever it takes to earn enough to buy a house free and clear in 4 years time so that she would have more financial freedom and choices down the line.  That’s enough of a goal to work toward to start with. 

Sarah realized she didn’t have many skills so she looked around to see what she could do.  What she lacked in skills, she made up for with enthusiasm!  She decided to apply to be a waitress at the most popular upscale restaurant near her parent’s home where she lived.  Luckily, she was hired and learned how to give great service to customers in order to increase her tips, because it was her tips that gave her the biggest portion of her take-home pay.  Legally, a restaurant must pay workers minimum wage or higher and because waitpersons get tips (compared to other restaurant workers who don’t) they are paid a much smaller minimum wage every week (typically $2.00 or less), and thus must rely on their tips to round-out their real weekly take home pay.

Sarah learned quickly how to get the big bucks in tips by waiting on people promptly, being friendly and helpful.  She always kept her areas bussed and cleaned and pitched in with other tasks during the dinner rush hours.  She kept busy and people noticed.  She took an active interest in how the chefs cooked the food so she could describe it better to customers, and learned about wines so she could recommend a good wine to go with every meal.  Her employer really appreciated this about Sarah because she helped him sell more wine and he even started a wine club on the side because Sarah helped to create more of an interest in wine among the customers.  All of her efforts led to promotions for Sarah and she got the pick of the best times to work.  This enabled her to increase her income exponentially each year. 

Sarah was soon working 5 dinner shifts a week including the lucrative weekend shifts and because she had applied herself, she got very good at her job.  She started out at $1.95 an hour minimum wage yet earned $22,000 her first year (her minimum wage checks totaled $4,000, and tips made up the rest).  Each succeeding year she increased her income and tips by $2000 annually.  So in 4 year’s time she earned a total well over 6-figures.  After paying her parents $200 a month for room and board, plus paying her taxes, transportation costs and other miscellaneous expenses, she managed to save $67,000.

At the end of 4 years time, she had saved enough to shop for a house.  In a smaller town just 17 miles from her parent’s house (and slightly closer to the restaurant where she worked) she found an older 1920’s house for sale.  It was a 2 bedroom 1 bath cottage-style house with a walk-out basement on a quarter acre of land.  Sarah paid just $57,000 for the home and owned it free and clear. 

The home needed some upgrades including a dry-sealing of the walk-out basement and fresh paint inside and out.  She removed all the old carpeting and found wonderful original wood flooring, which she sanded and refinished herself.  With all these upgrades, Sarah had depleted her remaining savings down to just $4,000 for her “emergency fund,”  but luckily, her best friend Kathy finally graduated college and had landed a job as a teacher in this same small town.

Sarah rented Kathy a room in her home for $400 a month, which was the going rate for this type of room rent in her area.  This arrangement worked out very well for Kathy, because she incurred student loan debt of over $47,000 between both her Bachelor and Master degrees in Education.  After completing all her college degrees, the Federal Government began enforcing the repayment of the loans, so even though she was working, she could not afford to rent her own apartment!  Kathy figured at least renting a room for a few years from her friend gave her some independence and a way to pay off her student loans quickly.

Sarah saved the money Kathy paid her and used it on more home improvements, including having a second full bathroom built in the basement, where she created a separate apartment to rent to a female teacher friend of Kathy’s.  She charged $600 a month for her 1 bedroom basement apartment plus $400 for the room upstairs to her friend Kathy.  Thus, in just four year’s time, Sarah had:

1.  Learned a trade and increase her knowledge base to earn a modest income;

2.  Saved enough money to buy a house free and clear;

3.  Became a landlord through renting rooms and leveraging the room rental to pay for

creating a basement apartment in her home, all of which;

4.  Added to her net worth and increased her monthly income;

5.  This extra money helped her maintain her home and helped her discover another use for her yard which she soon learned to leverage as another income stream, enabling her to quit her waitress job and start a home-based, part-time business!

While reading about inexpensive ornamental plants, shrubs and trees (which she wanted to use in her own yard), she discovered she could grow them herself and then turn around and sell them to landscapers and plant nurseries and make a nice income.  After further research she learned a certain ornamental tree accounts for most landscaping needs around new home construction, buildings and industrial parks.  This specific species of tree is the most lucrative tree sold by landscapers and nurseries.

Armed with this information, Sarah felt confident she could earn $10,000 growing this tree to a certain height within 2 years time, in order to sell them wholesale to other growers for $10 each.  Spending $600, she bought and planted 1,200 of this type tree as seedlings in her backyard (which surprisingly didn’t take up much space at all).  All she had to do was make sure they got plenty of sunshine, water, the occasional plant food, and mulch before winter.  In 2 years time 1,100 of the 1,200 seedlings grew to sufficient height and she sold them all.  The experience was such a pleasant one for Sarah, she determined to do it again, and grow other kinds of plants to sell.  The point being, she had found another way to earn a huge amount of money with part-time effort, which could finance almost anything she wants to do!

All of this happened because Sarah wisely determined to save enough money in four year’s time to buy a house free and clear rather than go to college and go into deep student loan debt. 

Today, Sarah’s monthly expenses are practically zero because she has no house payment to a mortgage company.  She has additional passive income from her rentals and has found a way to use her large backyard for a lucrative part-time business.

Given what Sarah was able to accomplish in just 4 years, eventually she quit being a waitress and began a small market garden in her yard, growing the herbs used by chefs in restaurants.  She added a year ’round greenhouse with ventilation and heat and grows enough fresh herbs to supply several area restaurants, working only part-time.  In fact, her former employer was her first customer!  Sarah still grows the ornamental trees and sells those, too.

Between the part-time herb and ornamental tree business, plus her rental income, she has replaced her modest former income as a waitress.  At age 25, she owns a home free and clear, is financially solvent, debt free, works part-time yet earns a full-time income and can afford to do just about anything she wants.  This is real freedom!

Additionally, Sarah discovered she really enjoys growing things and has made this her career.  She is even contemplating buying a couple acres of farmland to expand her herb and tree business.

Not bad for an average high school student who chose not to go to college, is it? 

Here’s another example of how people can leverage their savings to plant themselves on firm financial ground and give themselves a better future.

John and Sally were high school Juniors when they first went steady.  An unplanned pregnancy during the fall of their Senior year meant that Sally completed her high school diploma online at home.

Right after John graduated in June, the pair were married and Sally gave birth to a healthy son.  At first they were living in the basement of John’s parent’s home.  Rather than go to college, John decided to take a job offered to him at a local lumber supply company.  He earned $11 an hour working long hours, always volunteering to work overtime and to fill in when other employees were out sick or on vacation. 

Sally also chose to not go to college, as she now had adult parenting responsibilities.  She did find work as a babysitter/caretaker in the home of a career woman who worked full-time but had a 2-year-old daughter.  This was a perfect job for Sally because she could bring her own infant son to work with her and care for him at the same time she took care of the 2 year-old girl.  Her duties were fairly light:  making meals, doing some housework and playing with the children.   This was a full-time job for Sally and she was paid $180 a week.

John and Sally’s combined income was $730 a week.  They determined to have a place of their own and to be financially free as soon as possible, so they made a 4 year plan, as follows:

After taxes, their net income was $30,000 a year using every legal deduction available to married couples. 

They determined to pay John’s parents $500 a month for their basement bedroom and half bath, including all utilities and meals.   Since John owned his own car, he would drop off Sally at work every morning and pick her up later each day.  On days he worked longer hours, John’s Mother would pick up Sally and son and bring them home from work.  John’s transportation costs were gasoline ($50 a month) and car insurance, (rather high at $1200 a year).  Here’s what their 4 year plan budget looked like:

Out of the $22,200 that remained, they were very frugal and saved $21,000 each year.  They got all their clothes at resale and thrift stores, and asked for gift cards from friends and family for birthdays and holidays and used them for “date nights,” family occasions and diapers.  In 4 year’s time, they were able to save $84,000.

John had an interest in building things and decided to buy a 3/4 acre property on the edge of town that had a run-down, older 2 bedroom 1 bath single-wide mobile home on it for $62,000.  It didn’t look like much but the property came with an intact septic system and well water with a good flow rate.  Kathy spent her weekends cleaning and fixing it up and it was quickly made livable for the growing family. 

Using his employee discount at the lumber yard where he worked, plus finding doors, windows and hardware at a salvage yard, John built a small combination shop and single-car garage, for less than $14,000.  He saved money pouring the concrete foundation and doing most of the finish work himself.  Many passers-by were impressed with his work and contracted with him to build similar structures.  John discovered he could earn more money and do a faster job by buying prefabricated garages at wholesale prices, and then erecting them in one or two days, hiring temp workers to help.  During the warmer months, he would erect 5 to 8 of these structures and make additional money which went into savings.

One day he was approached to build a small house on a trailer frame for a young man who wanted to travel the country yet have a tiny house to live in rather than purchase an RV trailer.  He needed a small darkroom in the tiny house because he was a professional photographer and figured a custom built dark room would give him everything he wanted, rather than trying to rig a darkroom in an RV.       

John found this to be a very interesting project and started to work on building additional small homes on trailer frames.  He enjoyed this work because it didn’t involve the hassle of dealing with hired day labor and he could custom craft a home with his own special touches, except when he had the electrical and plumbing systems professionally installed. 

John’s income from this extra work enabled Sally to stay home with the children (a second child, a girl, by this time) and he eventually opened his own business creating and building tiny homes, tapping into this lucrative niche housing market.  3 years after moving into their own home, John was able to afford a custom-built stick home on their property, which was also paid for free and clear.  They finally moved out of the 900 square foot mobile home and into their custom 2300 square foot stick built home. 

Let’s Recap

In just 4 year’s time, John and Sally:

1.  Decided not to attend college and instead, found work locally that fit their skill levels right out of high school;

2.  Used their combined income to save enough money to buy a home free and clear, which;

3.  Helped give John additional experience in construction; which he leveraged into;

4.  A nice side business which enabled Sally to be a stay-at-home Mom, which;

5.  Allowed John to gain the skills and experience needed to make custom tiny houses in a lucrative niche housing market; affording them enough money to;

6.  Have a custom built home on their own land (all paid for free and clear) PLUS a new full-time job for John as a tiny home builder. 

So by age 22, John and Sally owned a home, had no debt and were financially secure.  

Additionally, in just 3 more years by age 25, John had gained enough experience to work from his own custom-built home on his 3/4 acre lot, building custom tiny homes for others, earning more than 6-figures a year.

All of this was accomplished ONLY because they made a 4-year plan to save enough money to buy a home free and clearand NOT go to college, incurring massive debt.  All of the extra income that would have been spent on housing went into their savings, which gave them a nice emergency fund, and the means for John to make a very lucrative living and provide for his family.  

Because they made a financial plan and stuck with it for four years, they were able to eliminate a future cost for housing.  Today, John and Sally can save and invest most of their income, providing financial security for their entire family well into the future.

All of these examples proves this Truth: 

If you are willing to do for a few years what others are not, you will achieve more than mere wealth;  you will achieve a self-disciplined life which can enable you to do anything.  THIS is the real education we should all pursue.

Even if you have been out of high school for many years, it’s never too late to start a four-year plan of your own.  If you are willing to do whatever it takes to save as much money as possible in order to buy a house and own it free and clear, you can achieve real financial freedom!  This is not impossible. 

Regardless of when you begin this journey, you still must ask yourself the same questions:  What will your future look like?  What will you choose to do?  I encourage you to make your own 4 year plan today and find the discipline to pursue the completion of your plan.  If you do, I guarantee you will be better off financially and be able to weather any financial storm.

Good Luck!

About the Author: This is a guest post by PJ Graves. PJ is a retired award-winning radio broadcaster, news reporter and writer, whose reporting has been featured on national radio networks and whose articles have been on Survivalblog, Prepper Website, Rapture Ready and various online news magazines. In addition to writing,  PJ runs Golden Page Media*, a digital publishing business with free email newsletter featuring innovative ways to save money, side-gigs, prepping tips and little-known ways to change careers without going into debt or paying for training.  She enjoys home church, living in Amish Country, exploring historic sites, classic films, cooking, volunteering at a local food bank, and small town living.

Note:  To get PJ’s free newsletter, click on the link to Golden Page media and click on “Contact” in the upper right hand corner.  Let PJ know you want the free newsletter and include your email address.