Like most aspiring homesteaders, we moved off grid to cut expenses and find a simpler life. We were hoping to work less, and spend more time in the garden, but we hadn’t planned ahead for a few key expenses.
Property taxes
Depending on where you live, property taxes can be a serious burden. In our town in Central Vermont, the annual property tax rate is 2.59%. That means we pay the town 2.59% of our home’s value every single year.
To make the math simple, let’s say it’s 2.5%. That means that even if we didn’t have a mortgage, we’d have to pay the town the full value of our home every 40 years just in property taxes. With annual tax increases, which have happened every single year we’ve lived here, it’s more likely that we’ll pay the town the full value of our house in closer to 30 years. It looks like even if you don’t have a mortgage to a bank, in our town at least, you have a mortgage to the town.
If you’re building your own home, there are a few things you can do to reduce the assessed value of your home and thereby reduce your property taxes. For the most part, assessments are calculated based on statistical criteria, such as square footage and number of bedrooms and bathrooms.
Plan for 1 somewhat larger bathroom rather than 2 or more as is common in houses these days. Feel free to build on extra rooms, but skip built in closets. A bedroom, at least in Vermont, is defined as a room with a closet and anything without a closet is an “office” or “den” regardless of whether or not your kids are bunking there. Be efficient about your floor plan, and minimize square footage wherever you can.
For your land, some states have reduced property taxes on agricultural land if it’s registered and protected. Vermont has a “current use” program, that reduces property taxes on land that’s kept out of development. To enter the current use program, you need 25 contiguous acres for agricultural use, plus 4 acres of “home site” around your house that can be developed. That’s a total of 29 acres of land at minimum.
Dependable Internet
We planned to finance out off-grid lifestyle with remote “on grid” work. That can work wonderfully, as you get the benefit of the lower cost of living in a rural area but still are able to pull in independent contractor wages from high cost of living areas like New York City.
There’s just one problem. To work remotely, you need dependable internet.
What happens when an ice storm covers your panels for a week? Of maybe your off grid power is working great, but power’s out in the rest of the state so your internet provider isn’t up and running.
For the most part, you want to choose to be indoors working for pay when the weather’s at it’s worst. Unfortunately, that’s when your internet is most likely to be down.
If you need internet to bring in income, try to locate your homestead within a reasonable drive of a town center where you can find a cafe, library or co-working space with reliable internet.
Better yet, try to match your off grid lifestyle to off grid work. Take up selling jams or soaps, tap trees and produce your own maple syrup. Work towards removing your source of income from the grid and you’ll be happier in the long run.
Generator Time (Fuel & Maintenance)
Since we still had “on-grid” income sources in our off-grid home, there were some days when we really needed power. In the summer, during gardening season, you have more power than you can use, but when you’re inside in the dead of winter trying to make a living things get stretched a bit thin.
Until we really learned how to manage power well in the winter, we needed a lot of generator hours to keep ourselves up and running. With a lot of generator hours, obviously you’re using a lot of fuel, which is expensive, but more importantly you’re putting stress on your generator that leads to break downs.
While you’d like to be able to fix everything yourself, if it’s your first generator experience, maintenance can be harder than something more simple like a lawn mower. When the power’s out and the generator wont start, that means the internet’s also down and you can’t exactly pull up a you tube trouble shooting video. Until you really know your generator, expect to spend more than you’d like with a local generator service company.
Thoughts?
How about you? What are you budgeting for moving off grid? What do you think other’s might have forgotten?
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Whether moving off grid or not, two other costs that increase very quickly, home insurance, and medical insurance, I had budgeted 10 percent a year, sometimes it is 20. Or 25 percent. Always reevaluate coverage and reshop if possible.
Agreed. Thus far, our homeowners insurance has only gone up 1 or 2% per year…but health insurance is all over the place. That one in particular is really hard to plan for.
I recently accepted a severance package that will put me into retirement 2.5 years earlier than I had planned. I’m selling my property that I had planned to homestead and will downsize from 5 acres to 1/2 an acre. I will be living in a pole building with living quarters, have a garden, chickens and the landowners (my daughter and SIL) raise pigs and beef so I just buy 1/2 a pig and 1/4 of beef. My goal is to be debt free after my property sells and I get the new place built. I will have minimal electricity, pellet stove for heat, the electric Co-Op for internet and gravity fed water supply. I’ve thought about solar panels, at this time they are cost prohibitive, I wouldn’t see a return on my investment.