Street Fighters Need a Home

Dear Barefoot,

Eight years ago, my husband and I were drowning in debt: we had over $80,000 on credit cards alone. We were hiding our car from the repo guy, had a final notice on our home, and owed money to everyone, including family. Our plan back then was to stuff the bills in a drawer and hope they’d disappear (spoiler: they didn’t).  

Then we found your book. Now we’re debt free, own our car outright, have $40,000 in Mojo, and not a credit card in sight. We’ve just reached Step 4 – the furthest we’ve ever been. We’re living on my parents’ acreage on the Gold Coast paying $400 a week rent. The plan is to stay until the kids finish school, around 15 years. By then we’ll be 50, and we’d love to buy a motorhome and travel while I work casually as a teacher. So here’s our question: Do we still try to buy a house now, or skip Step 4 and bump up our super to 15%?

Chantelle

Hi Chantelle,

You and your husband are weirdos. 

By rights you should have gone bankrupt, got divorced, and started working on matching his-and-hers drinking problems from opposite ends of town.

Yet you didn’t.  Instead, you dug your heels in and clawed your way out. That takes guts. I bet your kids are proud of you. I’m proud of you!

So, what would I do in your shoes?

I’d still follow all the Barefoot Steps:

Step 4 is to save a deposit and buy a home you can afford.

Step 5 is to boost your super to 15%.

Step 6 is to build your Mojo to cover three months of living expenses.

Renting from your parents is smart for now. Yet, over the long term, you want to own your home outright. Not for bragging rights, but because it’s one of the best ways to protect your future as you head into retirement. 

However, you don’t need to buy it tomorrow. Keep saving. Build your deposit. And, when you’re ready, buy a modest home and pay it off fast. In Australia, it’s weird to buy a home you can afford and actually pay it off. Keep being weird!