More Money Podcast - 057 Listener Series - What Lindsay Learned About the Real Cost of Owning a House

Episode Date: September 15, 2016

My second episode in my special podcast listener series features Lindsay VanSomeren, who is originally from Colorado, but now lives in Alaska with her husband. Her story is also a debt story like my first listener series episode with Amanda from Ottawa, but instead of student debt or consumer debt, she's dealing with housing debt. And no, not just carrying a mortgage, but the cost of fixing and maintaining a home. I guess some could call this a "Money Pit" situation (any fans of the 1986 Tom Hanks movie?), but what Lindsay is dealing with could honestly happen to anyone. Even if you get a housing inspection, you sometimes don't know what's wrong with the place you've bought until you've lived in it for a little while. It's sort of the dark side of home ownership that doesn't get too much attention. Luckily, Lindsay was kind enough to share her story, her experience and the lessons she's learned from it so you can avoid getting into a similar situation. Or if you are dealing with a housing nightmare, take some of Lindsay's bits of advice on how to get out of it. Lindsay also mentioned that one of the ways that helped her pay down her debt was to start freelance writing on the side. She even wrote about it on her very own personal finance blog Notorious Debt, and apparently she made $2,500 in her first four months of freelance writing! Got a story that you think would be good to share on an episode on of Listener series? Please email me! Shownotes: jessicamoorhouse.com/57 Learn more about your ad choices. Visit megaphone.fm/adchoices

Hi, welcome to episode 57 and the second episode in my special Lister series. Thank you so much for joining me. I'm super pumped. My next guest is Lindsay VanSummeren and she has a really great story because it's not kind of the traditional, you know, kind of story you've heard a lot in the news about student debt or anything like that. It has to do with her buying a home with her husband and a lot of things going wrong and it costing a lot of money and them kind of getting into debt that way. And so we chat about that and what they've been doing to get out of debt and what kind of things she's learned and what kind of tips that she has that she'd like to pass on to you. So without further ado, let's get into the interview. Yeah. Okay. So

yeah, thanks for joining me. As you know, many people know if they've listened to some of the other episodes from this kind of debt series, I did a blog post that featured four awesome women who are in debt, but they're doing what they can to crush it in a shorter amount of time than regular. And so you popped up, I think, I can't remember how we connected. Maybe it was over email or Twitter or something like that. But I needed to interview you because I really liked your story. And you're just like, what you're doing is very relatable, liked your story. And you're just like, you know, what you're doing is very relatable, but also inspirational. And I think it'll help motivate people to, you know, that are in similar circumstances, crush their debt, too.

Yeah, yeah. These kinds of stories helped me when I was getting started. So it's always great to hear other people's perspectives. Absolutely. I think especially when it comes to paying off your debt, like even for me, when I like kind of the only kind of loan I ever really had was a student loan. And I didn't know no one that I'm really in the hole. I'm like, yeah, you are. That's scary. But no one else really talked about, you know, being in debt and what to do. Like I had asked my parents, how do I pay this off? And they're like, well, you just have to buckle down and save it up and pay it off. Like, oh, okay. So I want to get more into your story specifically, because yours was a student loans and a car loan and then also a house. So where do you want to start? How did you start getting into debt? How did this all kind of start? Well, I think it all started with the student loans at first. I took out a couple of private student loans to fund me going to school when I was an undergrad and also to pay for my living expenses.

And at the time, I had no idea how much money to take out or how to calculate anything like that. So I went to my parents and we just together came up with a number out of the blue. It was $25,000 and we did that twice. And so that initially was $50,000 of debt. And over time, the interest has grown on it, of course. And yeah. And after that, we got a car loan, a couple of them. We've paid one off already a while ago. But we're still working on one.

And we also bought a house back when, gosh, I think it was like 2008 or so. Me and my husband, he was over in Iraq. And he came back. And we're like, it's time to be adults. Now we got to buy a house. Cause that's what you do when you're, when you're growing up. That's what you do. Supposedly. So we bought the house and it was great at first. We loved it. But where we were living, we were living in Northern, um, well kind of like middle of Alaska at the time. And there's this thing up there called permafrost, which is like permanently

frozen ground. And it thaws like the very tip of it, the top of the ground. But through the whole summer and everything, like just a few feet underground, it's completely frozen. And that kind of messes with the soil stability. And so like the house has had all kinds of problems. It's got like a buried septic tank. It had a buried water tank and all kinds of problems it's got like a buried septic tank it had a buried water tank and all kinds of things and it would just heat up and slowly sink into the ground and all the pipes would get like messed up and fall off and it's just a huge huge hassle and we've spent thousands of dollars I think I calculated at one point it was I think we've spent up to $35,000 so far just on repairing this house and we don't make that much money. And so some of it, we've been able to pay off just right off the bat, but most of it has turned into debt as well.

Wow. And I'm pretty sure that's pretty common. You think you know what you're getting yourself into, especially buying a house on land, you get an inspection, but these things happen. You know, like a year from now, oh, we have to replace the whole roof or this blew up. We need to replace it. Yeah. So people tell you like you need to, to budget for these things or you need to like be prepared to fix things when they break, but they don't tell you like how to budget for it and like how much you should and what to expect, what's normal breakdown and things like that, you know? So knowing kind of what you know now, cause you're, you've had the house for a few years now, I guess. Yep. you know. So knowing kind of what you know now, because you've had the house

for a few years now, I guess? Yep, since 2008. So yeah. So how would you, if you could go back, how would you budget for those kinds of expenses? Like, would you kind of go around the house and maybe put like post-its next to things like, this may break and that may cost this much? Or what would you suggest doing yeah so if i was buying a house up there again i would definitely definitely go through and look at things like that that might break and maybe talk with some people to see how much they might cost to fix um like what kind of timeline they might break based on the home inspection we also didn't have a very good home inspector as well. We just had somebody who was like a buddy of the realtors who did it for real cheap. And so he missed a lot

of things that we've since had another engineer come in and he said this would be a problem. And if we would have known that from the get-go, we wouldn't have bought it. But going forward, we do want to buy a house in the future, probably a long, long time from now. And we're going to be much more prepared. But that is one of the things we're going to do to see like what kind of state it is right now, the timeline for repairs, how much they cost and how much we might have to put away, you know, each month to have that amount ready when it comes time. So what are your kind of plans with the house now? I think in your blog or in my interview with you for the blog post, you were talking about trying to sell it. Yeah. So we've made a bunch of repairs to the house to make it more marketable. All the things

that we can fix on it should be fixed for now until the ground moves again. But that's part of owning this house, unfortunately. And we do actually have somebody who has contracted to buy the house. They're just waiting for their funding to come through. So finally, after we tried selling it since 2014, so we're finally just now, two years later, getting ready to sell it. Well, fingers crossed that this all goes through. That would be amazing. What do you plan on, you know, once you sell it, are you going to just continue renting where you are or what are your kind of plans? Yeah. So we're going to, we're going to

make a small amount, like $5,000 or so from the sale of the house, hopefully. And we're going to put that towards some of the debt that we have. And then we're working right now on building up a down payment for, for our future home. We're moving at a pretty slow pace, but we are making some progress and we're planning on saving up for a 20% down payment so that we can avoid PMI charges and things like that and be more financially stable. Because when we bought the house in the first place, we also used a zero down VA loan. So we have very little equity in the house right now. Something we want to avoid in the future. It would also help with our mortgage payments and things like that, too. That's good. Well, it's, you know, unfortunate that you went through what you did, but at least

A, you learned, lesson learned, and B, you can share it with a bunch of other people so they will also learn from your experience. So that's, you know, there's the silver lining. Yeah. So do you remember, this is almost kind of a test. Do you remember how much you told me was your kind of starting debt? Yeah. So my starting debt was 82,000 or no, that's how much I have now. Yeah, I know. You were really close. 87, 885. There you go. That's amazing that you remember that because those are like, you were really close. 87, yeah, 885. 885. There you go. That's amazing that you remember that because those are like, you know, it's not like a round number, 87, 885.

I'm cheating a little bit. I also have it right here. Oh, do you? Very smart. Very smart. So you had that, but you were able to kind of put some money to pay it down. So now it's only $82,568. Though it's probably since then it's probably gone down a little bit. Yeah, right now I think it's at $81,662.

Very nice. Very nice. So you mentioned to me for the blog post that you use a thing called Ready for Zero as kind of a tool that you use to help you. I've never actually used that. I've heard about it. What does it do? Yeah. So I have a lot of loans from all kinds of different sources. I've got, you know, auto loans, student loans, personal loans to pay off house repairs, things like that. So I have all these different places where I have debt. And what Ready for Zero does is it kind of collects them all into one place and it automatically logs into the accounts, pulls everything up onto one page so you can see your status. And it gives you all these little numbers. Like I'm a number cruncher. I like looking at all the

numbers and everything. It tells you when you're going to be debt free, how much you've paid off so far, how much more you have to go, how much you're paying in interest each day. And you can create a custom plan for yourself on how to pay off your debt. And you can, like, there's these little cool sliders I like to mess with. You can move the slider around and up increase or decrease your payment amount. So you can see what effect paying more or paying less has on your final debt-free day, which is ultimately the thing that people want to know when they're going to be debt-free. So I really like it. It's really cool.

That sounds very handy. Is it free? Yeah. Yep. Oh, okay. I love it then. That's awesome. That makes it all better.

Wow, I'm going to have to check that out. That's actually really handy because sometimes you need a handy tool that already knows how to, you know, do what you want to do instead of going the Excel spreadsheet route, trying to use a formula. Sometimes you're like,

no, I just need a tool that I could plug in some numbers. It tells me what I want to see. So that's awesome that you found that tool to help you. Get groceries delivered across the GTA from real Canadian superstore with PC express shop online for super prices and super savings. Try it today and get up to $75 in PC Optimum Points. Visit superstore.ca to get started.

So, you know, I know we kind of touched on this a little bit, but since you have, you know, kind of the debt from the house and the car and from student loans, and you're still kind of chipping away at it, but I know you'll get to where you want to be very soon because you seem like you're on a really great path. What are some lessons that you are so glad that you've learned from this experience besides kind of all the house stuff? Yeah. So I think the biggest thing that this has taught me was just, it's taught me a new way to help make money for myself because paying off all the debts and with all the house repairs on top of that, just piling in all the time, we were sinking

financially, basically. And I didn't want to be in debt for the rest of my life. I used to think that debt was like just something I'd have forever. And as each payment kept cropping up from all the different loans I had to take out, it just wasn't making forever. And as each payment kept cropping up from all the different loans I had to take out, it just wasn't making sense. And we weren't doing like, I wasn't living the way I wanted to. And so I started looking for extra ways to make money on the side. And I fell into freelance writing kind of. And I've tried other things before, like doing little surveys, you know, and transcribing things online. But they helped, but not as much as finding like a good, solid way to make money that would help me catch up on my bills and start to make progress moving forward. And so far, using this freelance writing, the extra income from it, I've been able to catch up on all my bills. And after we sell our house, we're going to be able to put away like almost probably an extra

$500 to $1,000 each month towards our debt, which will make it go away even faster. And then I've realized through going through this whole process that debt is not, I mean, like I was saying before, I used to think debt was just a normal part of life. But through all of this process of payments and everything, I've realized that it really, it's basically you're selling your life away. Like you're literally selling your future time away and realizing that it doesn't have to be that way. I can be debt free and then I can do whatever I want, basically, if I have enough savings and everything. That's been an incredibly empowering thing.

The doors are suddenly opening for me again in the future. Not right now, but I'm working to get there. Absolutely. And guaranteed, once you do make that, when you are financially free, which will hopefully be in just a few years, you'll realize how awesome it is. And I think that's a big reason why I want to do this debt series is so many people are in debt. Most people are in debt. But they either feel incredibly alone, you know, lots of people don't want to talk about it, because it is kind of, some people feel ashamed or whatever. Or, you know, besides feeling alone, they feel trapped.

And they feel like and they feel like, yeah, like it'll be forever. I'll be in debt forever. I have friends who have incredible student loans and they feel like, well, I'm just going to be paying this off forever. And like, it doesn't have to be like that. And that's awesome that you kind of took the initiative instead of just being like, well, we have to live, you know, you know, to the bare minimum, you went out there and found a second stream of income, which is awesome. And it seems like, well, we have to live, you know, you know, to the bare minimum, you went out there and found a second stream of income, which is awesome. And it seems like, you know, not just a second stream of income, but something that, you know, actually gives you pleasure. Yeah, you know, something that you are really passionate. Yeah, yeah, it's a lot of fun. It's amazing. I was working in a crappy

job before this too, that I didn't really like very much. It's fine for other people, but just totally outside the scope of what I wanted to do. And that was also another layer of depression. I was stuck in this position I didn't want to be in. And I had to be in it because I had no other way to make money. But through this other side income that I've been making, I could switch to doing that full time if I wanted and just do fun things and make more money doing it. Absolutely. No, I and I've definitely been in that space where I'd say kind of, you know, when I me and my husband moved to Toronto, and we didn't have any jobs, I was desperate for a job. And then I stayed in jobs for the paycheck, but I absolutely did not. Yeah, I wanted to quit every

day kind of thing. And it was one of those things where it's like I wasn't necessarily drowning in debt, but I also knew I could not leave that job because I have to pay my rent and my bills and everything. So when you kind of set yourself up in a position where you're either debt-free or you have enough in savings, you do have more flexibility and freedom to, well, no, I don't have to stay at this job. I'll be unemployed for a bit, but I can afford it. And then I could find the job that I want, which I think is, I mean, especially for us where, you know, growing up or millennials, we were told that we could do whatever we want. And then we realized we get into a job. We're like, this isn't exactly what I had in mind. Not what I wanted. No, exactly. But it's still, we're always kind of trying to chase that

job, that kind of dream job, which is good and bad, but at least we don't, we're not settlers. That's what I've realized. I don't know anyone who's really settling. So that's, that's something. Yeah. Yeah. And through, through the freelance writing as well, I've, I've actually, I've quit that job. And one thing that has allowed me to do is I, there was a job that came up. It was just a three month position and it was doing almost exactly what I wanted to do, like what I went to school for and everything. And I shouldn't like a logical person never would have been able to quit a full-time permanent job with benefits for a temporary three month job with no benefits and no guarantee of any employment. So I actually switched over. I quit my old job and moved to this temporary job.

And I was like, well, at least at the end of the three months, I can do freelance writing at the end of it if I don't have that job continuing. But I just found out that it will continue at least over the winter. So that's great. That's awesome. Yeah, I know. I'm so excited. That's so great.

I think that's another kind of misconception, I think, with contract jobs. And especially when I first graduated university, that was my first job. I had a four-month contract and it was for a film festival, so there wasn't any way to extend it. But there's a lot of jobs that it's a contract, but most of them extend if you do a really good job and they can't, you know, see themselves working without you. So that's awesome that, you know, you were able to have the kind of freedom to make that choice. And now you're working at your, you know, a dream job. That's awesome.

Yeah, that's great. All right. So just wrapping up, I know you've mentioned a lot of great things, but if you can give a couple pieces of advice for people that, you know, are kind of in your same boat, maybe they have 80 grand that they still have to chip away at, or they're in a same situation with the house where they've kind of got a money pit on their hands, what would you suggest for them to kind of break out of their, you know, debt prison, so to speak? Yeah. So no matter what it is you're facing, whether it's 80 grand in debt or a house that

you're trying to get rid of that you can't and you're legally obligated to make all these payments for it, whatever it is, so often when you look at those things, it just seems hopeless, like $80,000. If you just look at that and somebody came to you today and said, you owe me $80,000, you'd be like, well, I'm just done for the rest of my life, basically. I'm leaving the country. I'm going now. But if you do chip away at it small bits at a time, find ways to chip away at the debt or in the case of the house, I couldn't do anything with that. But what I could do was find extra ways to make money doing something that I liked and that made substantial contributions not just like you know a penny here there for clicking on an ad in a survey email or whatever if you find something you like and can help you then it helps make you happier it brings

more joy to your life and don't don't look at the big debts like that as a big chunk. Just work away small bits at a time and just celebrate each milestone. Like every $500 or whatever, then that's $500 less you owe and $500 more free you are for doing things you actually want to do in the future. So don't focus on the big things. Just work on small bits at a time. I love that, celebrating milestones. I think that's something that in general we don't do enough. Whether it's paying off debt or you've reached a certain savings level, make sure you celebrate those things. You don't have to spend money to celebrate, but still acknowledge and celebrate in some kind of way. Yeah, it's a big deal.

It is a big deal. It is a big deal. Well, thank you so much, Lindsay, for chatting with me. I'm, I think a lot of people are going to get a lot out of, uh, your story and, uh, I'm sure there's going to be some people that are going to look into freelance writing after this. Cause you know what? It works. That's actually happily when I moved here and had nothing to, uh, no job, just looking for a job. I, I did some freelance writing and that kind of kept me afloat for a few months. So it's, it's something to look into for a side hustle. Yeah, it's a weird thing to start, but I've actually got a post up on my website detailing how my process was, how I got started and like how I felt emotionally and how weird it was at first and the challenges I had to go over.

And I think that's a great post for people to read if they want to see what it's really like. Absolutely. Yeah. No, I'll link to that in the show notes because I think that's it's always yeah, important to like, oh, that's great. But how do I do it? So that's great that you wrote how to do it. Yep. That's awesome. Well, thanks again. And I'm excited to hear about your progress. I'll definitely maybe hit you up with an email in like six months to make sure how are things going and especially if the house is yeah yeah for sure and that was episode 57 with lindsey van summer now she mentioned in this episode that she's a personal finance uh freelance writer and also science writer and if you want to check out more about her you can at her website lindsey van summer and dot com very uh easy i'll also include a link in the show notes in

case you want to check that out. Make sure to check out the show notes at jessicamorehouse.com slash 57. And yeah, thanks again for joining me. Wasn't this a blast? Don't you want to share your story on a future episode? Right? If you do, please email me at Jessica at JessicaMorehouse.com. I would love to know what's going on with you and see if you would make a great guest on a future episode. So just think about it. Make sure to also subscribe to this show on iTunes so you don't miss any episodes. And if you wouldn't mind, would you also give me a review? I would love you forever. Until next Wednesday, I want to wish you a very happy rest of the week. And yeah, that's really it. So, peace. This podcast is distributed by the Women in Media Podcast Network.

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