How We Stay Debt Free & Save Up For Purchases And Projects

Q: You really should consider posting about how you two budget and save for your purchases and DIY. I’m constantly amazed at how you seem to never charge anything and how you consistently mention saving up for things. Now just tell us how you do it!! What about making the decision to replace something that still works? Is that a hard call for you guys? I never know when to live with something, replace it with something semi-cheap for the interim or save up for the big thing I actually want and go right to buying that instead of putting money towards a placeholder while I save. I’d love to know more about how you know when to save and when to splurge and how you live such a debt free life full of projects and home makeovers! -Barbara

A: First and foremost, John and I are super lucky to each come from families with famously frugal dads. So we both learned all about saving up for things, paying off our entire credit card balance, and never buying anything that we can’t afford on the day that we buy it. Of course it takes a decent amount of discipline (and it means that we’re constantly walking away from great deals & lovely things), but if we can’t afford them they’re not such good deals after all. So to honor our dads, we thought we’d post embarrassing old photos of them. Notice John’s dad’s tie- it was a Father’s Day gift John made using puffy paint… proof that paint doesn’t always make something better.

It’s funny because a lot of our stuff falls into the “simple and affordable” category (our dining table was around $150 from Target and we have a $25 thrift store chair in our den and a $30 consignment shop coffee table in the living room). So that really helps us keep money in the bank. We don’t believe in buying chintzy low-quality stuff to save a quick buck, but if there’s a chunky wood dining table at with good reviews for a third as much as the one on, we’re likely to go for the thrifty Tar-jay version (we’ve had our current dining table over three years and haven’t had one complaint yet).

But although we usually shop around for the best deal (and read reviews to be sure we’re not seduced by a lemon), every once in a while we do fall in love with the notion of something pricey and save for it like crazy (like our plush organic mattress or the new 2009 Altima that we saved for over the course of the past few years and then paid for in full on the day we drove it off the lot). But more on that a bit later. Basically, the key to our financial approach really is just to hold out for sales, use coupons, shop around, and aim for affordable items to mostly fill our home- and then devote a sliver of our savings to spendy stuff here or there (so we don’t feel totally deprived but also don’t drain all that money that we saved up overnight either).

Oh and living in Richmond helps! The cost of living is waaaay lower than it was in Manhattan, so years of dealing with those insanely inflated expenses makes it seem a lot easier to cut costs and save money here (since our mortgage is half of what we used to pay to rent two tiny NYC apartments). Our house was also completely affordable since it was a total fixer-upper (as in: less than 200K, you guys have seen the befores!). So we knew we could afford to put money towards fixing it up since we didn’t spend it all up front by purchasing a newly renovated casa to come home to (and since our monthly mortgage payment is a lot lower than it would have been for an already gorgeous new home in the area).

We also try to be frugal in other ways like by sharing a car, getting books from the library, making our own bagged lunches, and DIYing whatever we can (from tiling to haircuts) instead of paying an expert (you’ll see some links to other how-we-save-money posts at the bottom of this one). It’s not always glamorous, but the old a-penny-saved-is-a-penny-earned adage really rings true to us. So instead of making lots of money and spending it just as quickly, we choose to do what we love- aka: blogging- but live comfortably on less with a few simple switcheroos like haircuts at home and one dollar spaghetti dinners.

As for what we do when it comes to replacing something that works but still bothers us (like a functional old fridge that’s big and yellowed and probably not terribly energy efficient) we just save our pennies up if it truly makes us cringe. Once we have enough to actually afford a new one without putting it on a credit card that we won’t be able to pay off right away (which makes us feel so guilty that we wouldn’t enjoy the spurge) we go for it. Oh and we always sell the working thing that we’ll be replacing on Craigslist so we don’t send it off to a landfill. Plus then we get a bit of money for it (which we can mentally put towards our upgraded version, so it feels even more affordable in the long run).

We’ve learned that in our case it’s never smart to buy something cheap for the interim just to tide us over because we end up hating the fact that we spent money on something that’s just a placeholder for the real thing that we want (and we would rather have waited and put our money towards the forever-item instead of some temporary solution). This is a personal thing though, so if replacing your cringeworthy chandelier with a $50 version from Home Depot will help tide you over while you save for the $250 beauty that you’ll love forever, then it might be the best approach for you. Just think about what makes you happy and what you can honestly afford and try to weigh the pros and cons to come up with a plan that feels right for your situation.

We also always talk a lot before taking on a major room makeover to be sure that we’re both on the same page about how much we’ll spend. For example, after a lot of chatting and number crunching we guessed that we’d spend 3-5K on the bathroom remodel- and were totally surprised when we got it done for $1800 by doing all the labor ourselves and hunting down some amazing deals. So in the case of the big bathroom reno, we saved our pennies until we had 5K sitting there in our high yield savings account and ended up super happy to just spend the 1800- which meant we could move on to our nursery makeover with extra funds already on hand… which is always a bonus!

We actually find that we overestimate things a lot more often than we go over our budget- which we’re very thankful for- but we still like to save up all the money and make sure it’s in the bank just in case we don’t come in under budget (it would be super stressful if we only saved two thirds of what we needed for a project just because we assumed we were overestimating again). Oh and there’s a bonus to having our renovation dollars in the bank before we start. We’ve found that it takes a lot of stress and anxiety out of the equation, so the project is a lot more fun.

Take the nursery makeover for example, we went into it thinking that we’d spend around $1500 since we needed totally new furniture and accessories (like a crib, mattress, dresser, chair, ottoman, rug, curtains, chandelier, lamp, art, etc). But thanks to some deal hunting we’ve actually done everything from scoring a $20 thrift store chair and a $20 Craigslist dresser to hunting down a clearance rug and chandelier- which makes us confident that we’ll get ‘er done without reaching or exceeding our budget. Who knows, we might just come in substantially under if we’re lucky. It really does pay to spend the time pounding the pavement for the best deals and trolling places like Craigslist for solid well made furniture that you can refinish (a lot of which is much better quality than the cheap stuff that companies churn out today). See how the Craigslist dresser below turned out after we made it over with some stain, some paint, and some elbow grease.

All told, we probably spend between five and ten percent of our total income on home improvements (not bad considering that we’re pretty much constantly painting something or pulling up at Home Depot). But that’s just a rough approximation and it’s a really personal thing so each family should look at their bank account and their house to figure out what budget and home improvement priorities are the most important to them. Plus it’s kind of our job now (since I’m a full time home blogger we need to constantly take on projects to sustain our site). So because it’s such a high priority in our life, we go out of our way to save a lot of money in other areas, like by having just one car that’s fully paid off.

We drove a ten year old Maxima for four years with over 170,000 miles on it until we could save enough cash to fully pay for a safer-for-the-baby 2009 Altima, which we did a few months ago (yeah, that was a fun day). So making sacrifices and cutting costs in other areas has allowed us to save money which we use to pay things off completely (instead of continually laying out cash each month for a car payment or a credit card bill that we just can’t squash). And of course we do save a bundle on the transportation front by making the decision to be a one car household, so we can save all the money that might otherwise go towards purchasing, insuring and gassing up a second car.

We know the way that we save and pay things off is rare. And we know that there are probably people reading this post who have no idea how on earth two people like us could save up for renos before we do them or pay off a new car the day they drive it off the lot (hint: it’s not because we make a lot of money- in fact by national averages we fall way below the average income level, even in our area). So we’ll share this factoid about our spending habits. We’re insanely frugal in many areas where other “normal” people are not. A nice meal out for us is a once monthly trip to Chipotle. We probably spend about $10 a month on clothing (combined, and some months it’s zero). In fact I’ve spent less than $20 on my entire maternity wardrobe (thanks to generous friends and family members who have passed their leftovers my way). We’ve even begun to make our own cleaning products to save more money in that area and we already mentioned that we give each other haircuts instead of paying a professional.

So before you think it’s totally impossible to save a few hundred dollars a month towards some big reno goal or some dream furnishings that you’ve had your eye on, consider whether you can cut anything out at all (from that Starbucks coffee to that monthly haircut). And if you want to save even more, try going a whole month without buying clothing or going out to eat. All of a sudden you’ll see that it’s not that hard to save money once you really decide to make a major change. Heck, you can even downgrade from two cars to one (and start carpooling or riding your bike). Or you can even sell your expensive vehicle for something a bit older with more miles on it (trading car glamour for house glamour isn’t a foreign concept to us since we drove our last car into the ground and sold it to Carmax with nearly 200,000 miles on it when we finally had enough saved up to replace it).

In general our advice is just never to spend beyond your means and to take the time to save for items and projects that are truly important to you… instead of frittering away funds by grabbing a bunch of cheap accessories (but they’re on sale!) that you don’t need every time you walk into a store. Resist the urge! Really, if we don’t have the money in savings that we’re talking about spending then we just don’t spend it. Instead we use paint and other items that we already have around the house for some free mini makeovers to tide us over. And we’re always sure to take our time hunting down the best deals while our savings account grows (even doing things like hosting a garage sale or selling unnecessary items on Craigslist to make money to put towards our latest goal). And it seems to work for us- so we certainly hope that it does for you guys as well. Happy saving (and smart spending) to you and yours!

Oh and we’d love to hear how you save your pennies (any envelope system peeps out there?) or how you live well on less income. Share and share alike!

Pssst- To learn more about how we pinch pennies here at Casa Petersik check out our Save It series (read Part 1 here, Part 2 here, and Part 3 here) and find even more money saving ideas right here. Oh and this post about living with less (along with this one and this one) might help too.


  1. Val says

    I love your blog. Today’s post brought back memories to when my husband and I had no children. At that point in our lives, we were debt free and paid for everything in cash. Four kids later- with more expenses than ever- we’ve strayed away from that a bit. Your post re-lit the fire under my but to live like that again. Thanks!

  2. Rebecca says

    I need to give a shout out for Suze Orman who is much more comprehensive than Ramsey. And I need to say “dollar cost averaging in a low cost (Vanguard)mutual fund that follows the S&P 500.”

    You should also try using tomato juice (with garlic) instead of sauce for your shrimp pasta. It’s much lighter and ‘springy’ than its wintery tomato sauce counter part.

  3. Barbara the CT Granny says

    This is probably the most valuable post you have made and you have made a lot of good ones. You prove, day after day, that it is possible to have a lovely home and not be in debt. I can only make one suggestion that might help some of your readers: open a money market account and deposit each month one twelfth of your real estate taxes, one twelfth of your total insurance costs, plus an amount for things that go bust in the night. I also set aside an amount each month for travel. Then, when these larger bills roll around, you don’t have to scrimp for a month or two to be able to do what needs to be done.

  4. Jill says

    Thank you! This post was so timely with baby #3 on the way for this stay-at-home-mom! I even went back and reread all of your other posts on savings. It is so nice to know that other people try to live similarly to us. Thank you.

  5. says

    y’all are two of the cutest lil’ tiny tots, ever!!!

    sherry, my eyes are watering at you…such a lil’ peanut with your smile ;)

    first of all, my dad is UBER frugal and my mom’s mother is too! they were both HUGE advocates in my life of saving, buying only things you can afford! great life lesson to learn early on…in addition to the value of a dollar through hard work via our chore list :)

    CC hubby is actually quite the self made mad and grew up on welfare and has had no one in his life to sit down and explain finances to him. he’s BEYOND generous and would buy everything in site…but we make a good team and it’s a good balancing act!

    isn’t that what marriage is all about, right?

    we practice MANY of the same frugal habits that y’all do over here at CasaCullen so a big cheers to smart cookies like all of us :) xo and such a great post!!!

  6. Jill says

    After reading some of the other comments I want to add that you CAN be at home with the kids and no car. It works. We just plan our days we want the car (usually only once or twice a week) and we drive dad to work on those days. Other days we stay at home all day or walk to where we want to go.

  7. Hannah says

    Best post ever. Some of the smartest advice to others and best way to manage your finances. Its fabulous to be car payment free but also makes no financial sense to finance something that depreciates. Goes for credit cards to.

    Pay as you go. Only leverage yourself when you it is to make more money than the finance charges would cost you, rare unless you are a business owner.

    Great post, its amazing how inexpensively you can make change and you guys do a fabulous job at showing how its done!!

    Thank you.

  8. says

    This was a great, informative post – thank you!

    When it comes to saving for vacations, the hubs and I make use of the envelope system. It seems so gratifying to see the cash in our tucked-away envelope, and we’ll add $20 bucks here and there if we skip a night out on the town. If we start saving a year out, we really see a big wad which makes us VERY happy. We have less guilt while on the vacation and can just really enjoy ourselves!

  9. Lindsay says

    One thing I find that people often forget is to actually DO THE MATH. For example, I bought a new car a few months ago. I had plenty of savings to pay cash for it, but with a little haggling (and my good credit) they offered me a 0.5% interest loan. I earn significantly more than that where I keep my money, so it turns out I’m SAVING money by getting a car loan rather paying for the whole thing up front. I get to keep my money for longer, in a place where I’m earning way more interest than I’m paying the car loan people. The numbers aren’t HUGE (it’s just a car, after all, not a house), but still! :)

    Of course, depending on the interest rate you’re offered (which seem to often be horrible for some unknown reason), this may or may not be a good plan. But it’s definitely worth checking into!

  10. says

    Such an inspiring post–as usual, but for a different reason! It makes me so happy to hear about other young people who are successfully avoiding debt. I appreciate your honesty and that you are so careful with your money. It’s hard for most people (including myself, often) to realize how much of what we spend really isn’t “necessary.”

    For people that like “how to” guides and self help books (my friends tease me about this…), I alway recommend Ramit Sethi’s I Will Teach You to Be Rich. I prefer books for something like finance, but he has a blog too. I learned so much from that book–even if a lot of it was common sense–and we totally revamped our savings system because of it. The most effective change for us was automating everything possible. After we get our direct deposit pay checks, it automatically sends money to our “Down Payment,” “Savings” (for emergencies), and “Self Gifts” (like furniture, a new laptop, a bike, etc) accounts, which are also in a high interest online bank. Our credit cards are also automatically paid off completely each month, along with most of our bills. So much less stress!

    Things have been a little tight since we got a dog, though, so we’ve still got plenty to work through! Hopefully that expense won’t be as jarring now that he’s been neutered and made it through most of his big puppy appointments… I hate being worried about money!

  11. says

    I’m also a fan of It is a great way to analyze your spending habits. I was spending way more on food than I thought. I also have an ING account that automatically deducts money for my savings account. I don’t think about it at all and then I log on once a month to a pleasantly higher balance.

  12. zehila says

    i am totally moving to virginia! yea right i wish! L.A is so expensive…and it doesnt help that i suck at budgeting. but im gonna totally try! because i want my home to be as pretty as yours :)

  13. Gord says

    Great post. I will add that things will change when you have kids! :) I myself am a very careful budgeter; however, kids cost money and that really made it more difficult for us. I’d be interested to have another post from you once you’ve had your little one for a while and how you’re keeping up your “frugality” (is that a word?). :)

    • says

      Hey Gord,

      Yup, we already have heard that request a few comments back, so we definitely plan to update everyone when the bean comes along! Stay tuned…


Leave a Reply

Your email address will not be published. Required fields are marked *