Having a plan for your homestead finances is essential for turning your homesteading dreams into a reality.
If you aren’t sure how to afford a homestead or want to learn more about offsetting costs and what to expect financially, this post is for you.
Discover everything you need to know about homestead finances so you can reach your homesteading dreams.
Let’s dig in!
How Much Does it Cost to Start a Homestead?
There’s more than one way to homestead—making it difficult to estimate exact costs.
But if you start small and make a plan for larger purchases, homesteading can be quite affordable and even income producing.
Most people think homesteading means having acreage out in the country, expensive equipment, and farm animals.
But, to be a homesteader, you don’t actually need any of these things. You can start small with what you have right where you are. You can even begin your journey by homesteading in an apartment.
There are many homesteading skills that you can learn without investing in acreage or livestock. For example, you could take up cooking from scratch, learn to grow herbs indoors, and make your own herbal medicines.
I’d suggest making a list of modern homesteading skills you’d like to master and starting with the ones you can practice anywhere.
Where the Real Costs Lie
The expensive side of homesteading primarily comes from land, animals, and infrastructure. Your unique homesteading vision will determine these higher costs.
If your dream is to have your own land for gardening and raising chickens and goats, your financial plan will need to include:
- Home and utilities
- Garden equipment
- Bedding (straw or wood shavings)
Ideally, your homestead will include systems that help you save and make money. For example, growing cover crops to cut the cost of animal feed while selling eggs or goat’s milk at a farmer’s market.
Break down these expenses to estimate future costs and prepare for recurring costs. Starting small and saving up to reach your goals makes affording a homestead much easier.
How to Buy Property to Homestead On
Is your current space your forever homestead? If the answer is no, you’ll need to work this into your financial plan as well. Here are a few things to consider when planning out how to afford a homestead property.
Reduce Overall Debt
Before you even look at properties to buy, you want to first plan for reducing your family’s current debt. Homesteaders generally strive to reduce their debt as much as possible.
If you want to have a homestead of your own in the future, now is the time to cut costs, learn to budget, and work on saving where you can.
You’ve looked at how you can reduce your current debt. Now you can think about what you really want and need from a future homestead.
Get clear and specific about your homestead goals. Location, property size, and land characteristics will play a part in making those goals a reality.
Remember that you can build or remodel a home but you can’t change the land very much. Make a list of “must have’s” as well as “would love but don’t need’s” before you start looking at properties.
Building Or Buying
Do you want to build a home on your homestead property, or are you looking for something more move-in ready? Maybe your homesteading dream includes fixing up an old farmhouse.
Each of these scenarios has pros and cons, as well as a variety of different costs. Depending on your homestead vision, you’ll need to research things like building permits, property taxes, and insurance requirements when outlining your homestead finances.
Think About Utilities
Along with whether you build or buy, you’ll need to think about utilities. Will you live off grid? Then, you’ll need to include the costs of solar panels and batteries.
Is having a well on the property important to you? Where will your primary source of heat come from? There’s a lot to consider!
Make a list of the utilities you will need and your ideal way to acquire them (solar panels or the grid for example).
How to Reduce Expenses So You Can Afford to Homestead
Reducing living expenses is one way that you can free up cash for homesteading.
But many people think that reducing expenses and living on a budget is going to feel like deprivation. While it definitely can if you cut spending too much, living on less can also be very freeing.
At the end of the day, living frugally but abundantly is a skill and a mindset that needs to be cultivated.
If you think about cutting costs as a punishment, though, you will surely burn out. Instead, reset your priorities to see practicing new money habits as your path to freedom.
And remember to include some important luxuries in your budget so you don’t feel deprived.
Maybe you love expensive coffee creamer or weekly massages. Make sure you keep some of those things! For me, it’s usually food (expensive paleo-safe convenience foods), high-quality bedsheets, and quality clothing (though I do stick with a capsule wardrobe).
Simple living is the practice of doing more with less and being content with what you have.
You’ll have to work harder around the house to grow and cook food rather than eating out as often. But in doing so, you reduce expenses that quickly add up, forcing you to work more outside your home.
Plus, living within your means is an excellent homesteading skill to practice. The goal of living simply is to focus your priorities on what matters most to you.
Here are just a few ways to live more simply while reducing expenses to fuel your homesteading dreams:
- Get by with only one vehicle
- Grow or raise your own food
- Buy in bulk
- Cook at home more
- Design a life you don’t need to escape from (so you don’t need to spend as much money on entertainment)
It comes down to looking at what you really need and letting go of what you can do without in exchange for more financial freedom.
In time, you probably won’t even miss the things you thought you needed before. So be sure to give yourself some time!
Create Income Sources on the Homestead
Homesteading is an affordable lifestyle when you start small, reduce debt, and form money-saving habits. But you can also create a side income from your homestead to off-set costs.
In fact, I always try to have homesteading projects pay for themselves whenever possible.
For example, I try to grow some things to feed to the chickens to reduce the cost of feed. You can also sell extra eggs or produce that you grow since you’re already putting in the effort to grow them for yourself.
Making extra money homesteading is easier than you might think. Plus, it’s an excellent way to save up for those larger purchases!
Here are a few ideas to get you started:
- Sell produce, honey, or eggs at a farmer’s market.
- Start an Etsy shop to sell soap, lotion, and other homemade, natural skincare products.
- Offer your unique services like freelance writing, handyman services, or become an online tutor.
- Sell firewood, mulch, or compost.
There are so many ways to make extra money to put toward your homesteading dreams. My advice is to look at what you are good at and see if there is a way to make money doing that.
When you start looking at your homestead finances, you’ll see that every little bit helps!
Practice, Practice and More Practice
Whether the goal is to grow your own food or quit your 9-5 job and live off the land, getting your homestead finances setup is essential to reaching your goals. (Grab my free homesteading budget spreadsheet).
Don’t get stuck trying to make everything fit perfectly. You’ll be taking your homestead finances with you on this journey. Your goals may change along the way. And it might take a little time and added effort to generate an income from your homestead.
But with practice, you’ll get a system down that works for you. It’s all about learning to live within your means while creating a lifestyle that you love.
What is your greatest challenge to homesteading when it comes to finances?