Small farmers/homesteaders?

[roac]

Badfish,

All of the advice given here so far is great but none of it will get you your dream farm. It will help you when you have attained your dreams but won't help much otherwise. Having 2 jobs getting rid of cell phones not going to do it. Skills smills you need to concentrate on the money aspect now, you will have plenty of time to work out the final plans of your dreams in the coming years but you need to start saving yesterday. You seem to be pinning your entire dream on 2 things, a govt. pension and equity in your home. The equity will help but you need to supplement it with money from your own savings. As far as the pension goes, yeah I hope that works out for you. Too many people have pinned their hopes on those.

Do you have an IRA? I assume with a pension option you don't have a 401k option at work, if you do use it instead of the IRA. The single most important thing you can do now at your age is save for retirement. Max out your yearly contributions. If you haven't already you need to open an IRA account. Now is the perfect time to start one with the market down. Everything is on sale, in 5 years you could double if not triple your money never mind 20/30 years from now. If you scrimp and save today you will be that much better off in retirement. What are you doing with the income from the second job?


You need to assume that this farm is going to lose money from the start and forever. Not to be negative on your idea but always assume the worst when it comes to money. If it proves otherwise you will be that much better off. So assume you will need to pay your taxes, insurance, operating expenses and etc. all from your savings and plan accordingly today for that.

Ask anyone here in their "Golden Years" if they wish they had saved more when they were your age. You won't find one that doesn't...

Good Luck!

 

[Badfish740]

All of the advice given here so far is great but none of it will get you your dream farm. It will help you when you have attained your dreams but won't help much otherwise. Having 2 jobs getting rid of cell phones not going to do it. Skills smills you need to concentrate on the money aspect now, you will have plenty of time to work out the final plans of your dreams in the coming years but you need to start saving yesterday. You seem to be pinning your entire dream on 2 things, a govt. pension and equity in your home. The equity will help but you need to supplement it with money from your own savings. As far as the pension goes, yeah I hope that works out for you. Too many people have pinned their hopes on those.

I should have been more clear-federal employees have what is called the Thrift Savings Plan (TSP) which is basically a 401K. Right now I contribute 5% as that is the maximum amount they will match, but I'll increase it as my income rises. There's also the "built in" retirement plan that is an automatic $30.00 or so taken out of my check every month.

You need to assume that this farm is going to lose money from the start and forever. Not to be negative on your idea but always assume the worst when it comes to money. If it proves otherwise you will be that much better off. So assume you will need to pay your taxes, insurance, operating expenses and etc. all from your savings and plan accordingly today for that.

That's pretty much what I had assumed and it's been pretty well reinforced here

 

[jdemaris]

Badfish,

All of the advice given here so far is great but none of it will get you your dream farm. It will help you when you have attained your dreams but won't help much otherwise. Having 2 jobs getting rid of cell phones not going to do it.

Different strategies work differently for different people. I DID work two jobs to buy my first place, and I'm glad I did. Didn't have to worry about throwing out the cell phone since it wasn't invented yet. I didn't a pot to piss in at the time, and did it anyway.
Moved my family into a foreclosed farm, took a pay cut to work in a rural area, and we all lived in the house while I worked on it.

In regard to wishing I'd saved more money? Nope. I regret not buying more properties in certain areas when they were dirt-cheap. I'm getting 3% interest on my cash assets and that is not even enough to break even when you figure in inflation and taxes. Now, if I was an investment wizard, maybe I'd be better offer saving and investing - but my skills don't lie there. And, the investment "wizards" I hired in the past, wound up being worse at it than I am.

If I were young and making decent money - and yearned for a place in the country somewhere - I'd buy now, even if I wasn't ready to use it - before the price doubles or triples in a few years.

 

[jebatty]

In regard to wishing I’d saved more money? Nope. I regret not buying more properties in certain areas when they were dirt-cheap. I’m getting 3% interest on my cash assets and that is not even enough to break even when you figure in inflation and taxes.

You use the term "savings" in its proper perspective, not just putting cash away, although that's a piece, but more properly using your money to buy real assets and things of true utility, rather than frivolity. I could not agree more.

Money as a medium of exchange can be exchanged for short term pleasure and consumption as well as for long term value and usefulness. As an example, some of us look at a car as a device to get us from point A to B, and for that often a few hundred to a few thousand dollars will do really well. And others of us look at a car as a device to hold our coffee cups, dvd to entertain the kids, fancy upholstery to warm our rear ends, and the list of near uselessness doesn't quit, and for that $30,000 just begins to fit the "need."

Don't mean to dump on auto aficionados, as the list of near useless items on which to waste money is longer than space permits.

 

[jdemaris]

You use the term "savings" in its proper perspective, not just putting cash away, although that's a piece, but more properly using your money to buy real assets and things of true utility, rather than frivolity. I could not agree more.

Yes, and that seems to be more nebulous that ever (figuring what has intrinsic value now and perhaps later).

As I said previously, I'm no investment wizard. I do know that real property rarely loses value, and since I am good a working on such properties and reselling, that's where I tend to stick my extra money. In my lifetime, I haven't seen too many properties truly lose value - only take nose-dives after being overpriced to start with.

I'm sure there are others with different skills better at doing things differently. As far as buying real goods with intrinsic value? Yes, but you can only buy so much, and such value is dependent on the current state of society. There have been times when food, ammo, fuel, skills are highly valuable and paper money worth nothing. And yeah, I hear all the hype about precious metals. Maybe a good deal for some - but I know this. If you're hungry, you cannot eat gold. Cannot run you car on it either unless someone is willing to trade you fuel for it.

Back to buying a dream home in the country . . . I know many people could put off buying one new car for 30K, or skip a few vacations, and buy a farm house and 20 acres somewhere for the same money - if they truly wanted to do it.

A dairy-farmer friend of mine spent years buying properties all over the country in market-down situations (just like now), and he did so by making down payments, gettting low interest loans, and then renting or leasing those properties out. All, more-or-less paid for themselves over time with rental income plus big increases in values. But, I tried it, and it's not for me. Too many headaches being a landlord and dealing with management companies if the properties are far from home.

 

[jebatty]

There is a big difference between dreams/wishes and goals. "I'd like to own a small farm some day" is nothing more than a dream or wish. "On June 1, 2011, I am the owner of a 15 acre farmstead" is a real goal that can be implemented with a plan. Start laying out every step to achieve the goal, with a time line on each step, and the goal will be realized. Obviously, the goal has to be achievable to be meaningful.