13 Ways a Tiny House Can Save You $378 a Month or More


This post is going to show you 13 ways that you can save $378 or more by living in a tiny house. And that’s just the beginning because some families are saving much more than that but for now, let’s get right into it.

1. Little to no mortgage

Making the decision to build a tiny house on a trailer so that you can live in means you most likely won’t have a mortgage. Actually, banks don’t normally finance little homes like this even though they will help you with an RV most of the time. We’ll see if someday we can easily finance our tiny houses on trailers. Even if you could somehow manage to get a 30 year mortgage on a tiny house, it would only cost you $366 a month if you had to pay 7% interest, had no money to put down, and you paid $55,000 for it. This would obviously mean that you did not do any of the labor yourself. Not too bad, right? It gets better...

2. Miniscule heating and cooling bills

I’m not sure what you currently pay for your utilities but I think you’ll be impressed with how efficient a little home is. Most people having to heat or cool their tiny homes pay just $10 to $35 a month for all of their utilities. Most people that I know pay an average of $120 a month for utilities, but it can easily be much more.

3. Easy and relatively cheap to build

Costs for materials for the average tiny house on a trailer that’s less than 200 square feet is about $21,000 if you buy everything new through a retail store like Home Depot or Lowe’s. This, of course, does not include labor for anything you don’t feel comfortable doing. You can always attend a Tumbleweed workshop to prepare yourself for your first project. Later, we’ll talk about how much you can save using reclaimed materials.

4. You don’t have to buy your own land

It turns out that most people who’ve built and now live in their own tiny house end up working something out with someone who already owns land. In these situations you can either pay a little bit of rent (as little as $100 a month) or exchange a service for your stay. You can provide care for an elderly person or labor for a small farm. Or you can simply park in a friend or family members rural backyard. And when the time comes to move, you don’t have to worry about land ownership.

5. Park it in your backyard and rent out your big house

If you’re lucky enough to already live in a location where you can park a tiny house on a trailer or an RV- or maybe you can build on a foundation as a shed, pool house, cabana, guest house, or accessory structure- you can start your project right away, or look for the right property to buy. 

6. No more high rent or mortgage payments

I don’t know about you, but I pay about $900 every month in rent as I write this. That’s $32,400 every three years. I wouldn’t mind parting with that, or at least turning it into something I can own free and clear someday. Some of you pay less, and some of you pay more but either way it’s one of our largest expenses. If you’re paying a mortgage do you think you could rent your house out and cover all of your costs, if you wanted to? This way you’d turn your current home into an asset that pays itself off while you live mortgage-free in a tiny house. Now that would be smart, wouldn’t it?

7. You can use reclaimed materials to build your tiny home for cheap

I’ve talked to people who have built their own tiny house on a trailer for as little as $3,500 because they took the time to find free or cheap reclaimed materials like doors, wood, windows, siding, and more. It can save you a lot of money up front to dedicate an extra two or three months just for finding the right materials to suit your design. It also helps to be open to changing your design as you find cool stuff to use for your build. Whether you end up spending $16,000, $7,200, or just $5,700, you’ll have a one-of-a-kind home that’s fully paid for!

8. You can do the labor yourself

There are now several stories out there of everyday people, like you and me, with no previous carpentry experience, building their own tiny houses. Many of them end up recruiting the help of friends and family and others hire help when they need it (like for plumbing and wiring, for example). If you’re new to construction or just the idea of building tiny and/or on a trailer, you might want to consider one of Tumbleweed’s tiny house workshops.

9. No space for oversized and overpriced furniture

In a tiny or small house, there’s only so much room for furniture. Most people who are living tiny just have a couch (usually built in), a bed, entertainment center, and a table. That’s about it. There’s also built in bookshelves, closets, and other storage. That means you’ll never really see that Rooms to Go bill again just to fill all of that space in an oversized house, condo, or apartment. You won’t need a huge dining set, side tables, and an enormous desk, either.

10. No space for constant new clothes

Living small usually means cutting down on your wardrobe. In a tiny house, studio, or even in most apartments there’s just not that much closet space. Especially if you share the place with someone else. In a tiny house, there’s only room for what you love and personally, I like that. If you love your clothes, you can always adjust your design or choose one of Tumbleweed’s tiny house plans that includes the right amount of closet and storage space for you. But the point is that in a tiny home you’re less likely to go buy new clothes every forty days or whatever. Instead, you’ll probably buy a few really nice, high quality outfits that you really love wearing (you know, your favorites). That’s what I do to stay happy with less clothes (but I’m a guy, so what do I know).

11. Less repair and maintenance costs over time

Owning less means dealing with less. Isn’t that nice? So over time you’re going to save on all kinds of repair costs in money, time, and stress. Need to paint the house again? No big deal. Time for a new roof? No problem. Need to fix something? That should be pretty simple (especially if you were the one who built it, right?).

12. Less room for children

This is my least favorite money saving benefit because I love children. And when I’m older, I probably won’t be able to live in a tiny house anymore for this reason alone. But for those of you who don’t want kids, or already have them, it’ll save you money either way which leads us to the next, and last, money saving benefit for living in a smaller home.

13. Less storage space for excessive children’s toys and gadgets

Most kids who live in small spaces end up find creative ways to meet their needs instead of depending on the latest and trendiest toys and gadgets which can get really expensive for parents. These kids tend to play outside more and interact with other kids. But maybe with all of the money you save on everything else, you can afford to buy the family an iPad for everyone to play with! My niece and nephews love this thing more than most of their toys because of all the available interactive games you can play on it and it hardly takes up any space in your house.

If all of the above adds up to a savings of just $378 a month for you, you would end up with an extra $13,608 in your pocket after only three years. But I believe that most of you would get to save a lot more than just $378 a month by moving into a tiny house. The main challenge is coming up with the money to build it or buy it up front or getting financing for it. But if you look around, you might find that you can come up with enough money to start by letting go of some of the possessions you have around you. Just maybe, because not all of us have that option. But if you wanted to, could you? Would it be fair to your family? If not, then don’t. Your family is more important than saving money. Maybe you can ease them into the idea over time instead.

But the fact is that most of you can save a lot more than $378 a month by downsizing in some way. One young family, who I won’t name, is getting to save an entire full-time salary by moving from their big house to a tiny one that they built mortgage-free. They’re getting to put away at least $1,745 a month, but probably more.

Can you imagine that? That equals to $62,820 after just three years time. Wouldn’t you agree that that could be very powerful for an individual as well as a young family? That’s how to get ahead relatively fast. With that kind of money, you can buy a more comfortable home for a growing family, start your own business, pay for an education, or pay off your debt completely in just a few years.

Alex Pino promotes tiny houses and other small spaces through Tiny House Talk. He currently lives in a 600 square foot apartment and has been downsizing since 2007. In the summer of 2012, he’s going to be traveling through the United States after pairing down to what fits in a backpack.

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