How A Family of 5 Lives on $226k in Colorado

I picked today’s Home Economics in part because I was excited the writer had older kids. While there is a lot of media coverage about the sky-high cost of child care and college tuition in the U.S., it feels like there’s a whole lot less written about the expenses related to the preteen and teen years. Arguably this is an age range when things could be cheaper for parents because you can send your kids to public school, and you no longer need to rely on $20-an-hour babysitters.

And yet, today’s entry (as well as Home Ec No. 46) tells a somewhat different story. There are all kinds of expected—and unexpected—kid-related expenses that pop up when raising middle and high school kids: club sports, school trips, test prep and tutoring programs, and orthodontics. My eyeballs popped out of my head like a Looney Tunes character when I learned that today’s family is paying $6,000 per kid for braces. Oof!

But unlike child care, which is a necessity for two-career households, many of these bigger-kid expenses are arguably optional. Should you buy your kid a car? Should you say yes to every school trip that comes along? Should you give them an allowance so they can go to Starbucks with their friends after school? You want them to have cool experiences and a healthy social life, so it can be hard to say no. Plus, as your kid gets to an age where they can ostensibly get a job, there’s also the question of how much they should be contributing to these expenses. And then there’s the white whale: paying for college!

I don’t think there are always clear answers, but it’s a topic I want to explore more at The Purse. Talking about money with your older kids is so important, but it isn’t easy—especially if they’re experiencing income disparities firsthand. There can be a lot of pressure to provide every opportunity for your kids, but should it come at the cost of your own economic security? And where do you draw the line?

I’d love to hear from Purse readers on this topic. If you have older kids, how do you educate them about money? Did you buy them a car? Make them get a job? Say no to a school trip that was too expensive? And what topics would you like us to cover? You can reply to this newsletter or leave a comment!

We’re also always looking for new editions of Home Ec. You can fill out the form here!

Share your Home Economics

Now on to today’s entry!

Age: 41
Location: Small town in Colorado
Relationship status: Married
Age of partner: 47

About me: I am a mom of three middle and high school–aged kids living with my husband in a rural-but-high-cost-of-living mountain town in Colorado. My husband and I both work full time and each have a small side hustle. We love the outdoors and small-town living. Our social community is very important to us, and we prioritize it whenever we can.

Income:

Your job title/salary: Nurse, $90,000
Partner’s job title/salary: Federal employee, $92,000
Your monthly take-home pay (paycheck amount after taxes and other deductions): $5,070
Partner’s monthly take-home pay (paycheck amount after taxes and other deductions): $4,840
Side hustles: ~$20,000 per year. I pick up extra PRN shifts at a local medical facility and also help with their chart audits. My husband does landscaping jobs with some friends.
Rental property income: $2,000 after expenses. We own three rental properties: two single-family homes and an ADU on our property. We are trying to be mortgage-free on all properties in 10 years, when my husband can retire from his federal job. We are using the snowball method to pay off the debt faster by putting an extra $2,400 per month toward the mortgages—the $2,000 profit from the rent plus another $400 a month from our income.

I think landlords generally get bad reps as greedy slumlords. When we purchased these houses, we vowed to be part of the solution, not the problem. In the end, these houses benefit us financially, but we see it as a symbiotic relationship, as our tenants take care of these assets for us. We are good, caring landlords. We rent all three houses for below what is even considered “workforce affordable housing” rates as set by various entities. We decided to make these long-term rentals and rent to the workforce (as opposed to short-term rentals for tourists) and try to be as reasonable as possible, knowing for us this is the long game. But between the three houses, we could easily charge $1,000 more a month.

We are determined not to do that. It was a hard decision to make because we are working side hustles to bring in additional money. No promises we will always rent so low, but for now we are happy with our tenants and want to support the workforce as best we can.
Total monthly income: ~$9,910. I don’t include our side hustle or rental income in our monthly budgeting. All of that extra money is put into a savings account. We only started these side hustles in the last few years, and the extra money has allowed us to pay cash for some big expenses, including travel and home upgrades. I realize that the side-hustle money isn’t guaranteed, and it could go away at any time.

Account balances:

Checking account balance: $10,000
Savings account balance: We keep everything in our high-yield savings account.
High-yield savings account balance: $91,000 with a 3.3% APY
Monthly contribution to savings account: We put around $2,000 on average into our savings account each month, but I’ll also take money out to pay for things. From each of my biweekly paychecks, I put $750 into the HYSA. I also put all the money I make from my side hustle. But because I have everything organized into different savings buckets (more on that below), we definitely aren’t saving $2,000 a month.
Retirement account(s) balance: This is a little tricky to break out because of how my husband’s federal retirement plan works, but in total (as of the end of December 2025), we had $778,650 between traditional and Roth accounts.
Monthly contribution to retirement accounts: $2,866. I put in 6%, and my employer matches 6%. My husband’s employer matches 3%, and he puts in 15%. I also max out my individual Roth, which is another $550 a month.
Investment account balance: None. We just have our retirement and high-yield savings accounts.
Monthly contribution to investment accounts: N/A
529 account balance: $70,000 total. Each kid has their own 529 account. We’ve run some calculations, and we should be at $50,000 per kid when it’s time for them to go to college, which we realize may not be enough. We are considering increasing our contributions. At least with our oldest, who is 14, we are already talking with him about our goal for him to go to college debt-free. That means he needs to get at least a 3.8 GPA (which he’s absolutely capable of) and go to a smaller state school. I think college is important, but not if you come out with debt. We are also okay with a trade school. And in the end, we know it’s their life! One cool thing is that our high school has concurrent enrollment with a local community college, so it’s possible to graduate high school with an associates degree, or at least a lot of college credit, for free. This allows kids to graduate college early, or take fewer credits per year over four years, which may leave space for more fun, internships, or a job.
Monthly contribution to 529 account: $300 total. We’ve put in $100 per kid every month since they were born.
Emergency fund balance: Our HYSA is our emergency fund.
Goals-oriented savings accounts: Ahhh so many! Our bank allows you to have sub accounts, and I’ve taken advantage of it! Of the $91,000 in our HYSA, $50,000 of it is a dedicated emergency fund, and the rest is divided into many other accounts—20 in total. Some are for things like Christmas gifts or car insurance, which are yearly costs that we save up the exact amount in advance. We are also saving for lots of vacations—each kid gets a bucket-list trip, and I have them labeled with the year we want to travel (e.g “bucket-list trip 2028”). We also put $500 per month into a car fund, which has around $15,000. My husband and I each have our own “fun money” accounts. Our driving goal is to save for everything that comes up.

Here’s the full list for those who are curious: emergency fund, vacation 2026, adult vacation 2027, bucket-list trip 2028, bucket-list trip 2029, bucket-list trip 2030, car insurance, charity, Christmas gifts, my fun money, husband fun money, gear/fitness expenses, kids’ activities, medical, new vehicle, oldest kid’s car, ski passes, taxes, Thanksgiving trip, rental houses.

Total in checking, savings, and investment accounts: $949,650

Housing:

Size of your home: We live in a five-bedroom, two-bath house that’s around 2,000 square feet.
Mortgage: $2,650. Our original mortgage was $850 a month, but in 2020 we realized we had a golden opportunity to take advantage of the low interest rates and the ability to take a lot of equity ($350,000) out of our home to invest in the rental properties (more on that below). That’s why our mortgage balance is more than we paid for our home in 2008. One rental house is an ADU on our property, so we don’t have a separate mortgage for it. The other two houses have mortgages around $1,100 each.
Current home value: $900,000
Current mortgage balance: $420,000
Year you bought your home: 2008
Price you paid for your home: $220,000
Mortgage interest rate: 2.90% for our primary residence, 3.9% for the rental homes.
How much was your down payment? We made a $40,000 down payment on our primary residence in 2008. We made two $100,000 down payments on the rental properties using money from a home equity loan. We used the remaining $150,000 from the home equity we borrowed to build our garage and ADU.
How long did it take you to save for the down payment? My husband was the one who saved up the money for the down payment on our primary home, all thanks to his brilliant frugality in his 20s. He’s seven years older than me, and I was a recent college grad when we bought our first house.
Did you have any family help buying your home? We didn’t have any help buying our primary home, but my in-laws did give us a $50,000 interest-free loan to help us put an addition on our house. (We saved $30,000 toward the renovation, too, and we did much of the work ourselves.) We paid them back over eight years. That was the only time in our lives that we were out of money. After the addition, I was worried if we’d even be able to pay off our credit cards!
Home taxes: $216
Home insurance: $233
Electricity: $100
Water: $100
Natural gas: $75
Cell phone: $190
Internet: $90
Housekeeper: N/A
Gardener: N/A

Transportation:

Monthly car payment: We’ve never had a car payment—we’ve always paid cash. Until we recently bought a 2020 SUV, we always drove really old cars. Right now, we’re trying to figure out if we’re going to help buy a car for our oldest, who will be 16 soon.
Car insurance payment: $158 covers our two cars
Gas: $250
Car maintenance: $75
Parking: N/A
Monthly public transportation: N/A
Ride shares (Uber, taxi, etc.): N/A

Children:

Number of children and their ages: We have three kids, ages 10, 11, and 14.
Nanny: N/A
After school: N/A
School tuition: N/A
Babysitter: Our kids are old enough to stay home on their own now. My parents live in town, or we’ll also send them to friends if need be. I spent too many years paying for child care, and I am done.
Extracurricular activities: $600. All three kids play competitive soccer. This also covers a few other sports (which are less expensive) and a few reasonably priced summer camps. It does not include the cost of traveling for soccer games, which is part of our travel budget. We have intentionally stayed away from overcommitting our kids, though the soccer we do feels like a lot. But there are so many fun offerings for them that are reasonably priced. Like our middle child just tried out for a school play that two high school students are producing, and the whole thing costs around $15!
Other: $150 for orthodontics. Braces are expenses—$6,000 for each kid! My first kid got braces three years ago, and we set up a payment plan to cover the cost. After that I started saving monthly for the next two.

Debts:

Student loan total balance: $0. I have two undergraduate degrees, and I had loans from both. I honestly can’t remember how much I had with my first degree—maybe $20,000 or $30,000. My brilliantly frugal husband had some cash, and we both had jobs and low expenses, so we were able to pay them off quickly. Then I went to nursing school, and my husband paid for a lot of it. When I graduated, I think I had about $28,000 in loans, but we were able to pay them off quickly when I got my first nursing job.

My husband never had student loans. He went to community college for two years, and he lived at home while getting his degree.

We disagree a bit about college. I loved college so much, and I want my kids to have the full experience, including living on campus. My husband has the mindset that getting your degree should cost as little as possible. His college experience was just a means to an end.
Personal loan total balance: N/A
Credit card balance (if you carry a balance month to month): We put everything we can on a credit card but pay it off fully each month.
How much do you spend on your credit card(s) each month: Between $3,000 and $5,000 a month

Food:

Groceries: $1,200. I love to talk about this because I’m so proud of how we shop and eat! I shop at Safeway once a week. I started doing online grocery shopping, and it has reduced our costs so much. I find it’s easier to keep track of what’s worth buying or not. I also shop at Costo when we go to the city (two hours away) and generally buy mostly meat and a few bulk snacks, oils, seaweed, and frozen fruit. We also buy bulk salmon from Alaska twice a year, and that is expensive.

We eat all meals at home, home-cooked but nothing special (think spaghetti, tacos, burgers, etc.). I have very hungry, big eaters, and we prioritize protein when we can. That being said, feeding teens has become hard, and I see why my mom just bought us things like Hot Pockets to keep us full.

We are also so happy to be the central hub for some of our kids’ friends and therefore have a bit of an open pantry. It might drive me crazy sometimes (last week a bunch of them stopped by for snacks, and my kids weren’t even with them!), but letting these teenagers eat my food is okay with me if it means I get to have them around more.
Dining out: $250. We almost never eat a full meal out. It’s too expensive, and it’s often disappointing. This budget covers small things, like meeting friends for coffee or appetizers, or if we stop to grab french fries when driving home from a soccer game.
Alcohol: $75. I keep this as a separate category. I don’t drink at all. My husband gets one six-pack of beer a week and meets his friends for happy hour once a week.

Socializing and Entertainment:

Subscriptions (streaming services, magazines, etc.): $75 total, which includes Paramount+, Spotify, Amazon Prime+ Kids, AppleTV, Sirius, Acorns, and iFit. We also share a lot of logins with friends and family.
Memberships (museums, etc.): $0
Movies, concerts, other events: $0
Entertaining and socializing other: I lump this all under travel.
Hobbies: I consider this part of our travel budget, too.
Travel: $1,200. Our travel and recreation budget is our biggest category after mortgage and groceries, and it includes all hobbies, travel, gear purchases, etc. Our expenses are really wide-ranging, and this is sort of a catchall. For example, when we take an international trip, we’ll spend between $10,000 and $12,000 (it’s expensive for five people to fly), and a domestic trip will range from $1,500 to $4,000. We also live in a really fun area, so we do a lot of outdoor recreation which is more reasonably priced. We’ll pay for things like rafting permits and campground reservations.

This category also includes things like sports equipment repairs, new bikes, rafts, etc. Sometimes, we’ll only spend a few hundred in a month, and other times it’s in the thousands. I’d say we average around $15,000 per year. We love to travel and be outdoors.

Miscellaneous:

Clothing: $150. This just covers the basics—wardrobe updates for my husband and me as well as if we have to buy clothes for the kids because there are no hand-me-downs available. We recently decided to offer the kids a $500-per-year clothing-and-haircut budget when they reach high school, so our oldest gets that money now. We still pay for his needed sports gear (cleats, snow pants, etc.).
Home supplies: ~$75, but I include it in our grocery budget
Exercise: $100. We have a home gym in our garage, which my husband uses a ton, and I use some. I pay $900 annually for an unlimited yoga pass for a studio near our house.
Personal and self-care (haircuts, manicures, massages, etc.): $75. This includes a haircut every other month for me and a pedicure during the non-haircut months. My husband cuts his own hair, I cut the younger kids’ hair, and my oldest uses money from his clothing budget for his own haircuts.
Pet expenses: N/A
Donations: $50
Tithing: $100
Events (birthday parties, etc.): $275 monthly average on gifts, but that includes money I save toward Christmas
Amazon: ~$141 for miscellaneous purchases

Insurance:

Life insurance: $70 for a $500,000 policy for my husband and a $250,000 policy for me. I also have a $500,000 policy through work, and my husband has additional coverage through the federal government that we don’t quite understand.
Health insurance: $375 per month includes dental and eye, which comes out of my husband’s paycheck. This is one of the amazing benefits of working for the federal government. We only have a $1,000 deductible. We have been lucky to be very healthy so far, so I don’t really know what care would be like if one of us got very sick, but I believe after the deductible, it’s an 80/20 split. My husband also gets to keep his insurance from 57 forward once he retires. But he can’t leave his job, or he’ll lose the benefits. It’s golden handcuffs for sure.
FSA contribution: N/A
HSA contribution: N/A

Total monthly spending: $14,108 (includes the mortgage payments on the rental homes + the additional debt payments; monthly spending drops to $9,408 if you remove those expenses)

Tell us more:

What are your top financial priorities?
I would like to retire, or mostly retire, when my husband can at age 58—so in 10 years. In order to do this financially—because our investments are held in retirement accounts—we need to pay off all three mortgages.

That’s why we are snowballing our debt by putting an extra $2,400 per month payment into one mortgage, then once that’s paid off, moving onto the next one, until they are all paid off. If all goes as planned, in 10 years we will have no primary mortgage or rental house mortgages and should be able to collect $4,000 per month in rental income. Plus, not having a primary mortgage will significantly lower our monthly expenses.

Between the rent and my husband’s pension, I think we will be very close to covering our monthly living costs. We wouldn’t necessarily need to start dipping into retirement savings at that time. We also don’t think either of us will be fully done working at that age (51 and 58), but we’d like to feel like work is more optional and we can do it as we please.

We also prioritize never going into credit card debt, and we’ve even paid for our cars with cash. We plan for almost every expense and save for it before we spend it! This is so hard to do, but it feels like such a relief when a big expense comes up—like vacation or a soccer camp for the kids—and we’re able to just pull that money from a dedicated savings bucket.

We also really want to have fun right now! Travel and recreation are important to us, and that’s why we have the side hustles. Our regular incomes support our life just fine, but if we want to go on international trips, pay for our car in cash, or do a house remodel, we need more income. Right now this is working for us, but it can definitely be a little draining to have these second jobs, even if they are not too time consuming.
How do you feel about your current financial situation?
I feel really good most of the time! I’m a big Ramit Sethi fan, and his advice to step back and look at the big picture made a huge difference in my life. Seeing our investments now and where they will be in the future has reduced my stress significantly. Having a plan to pay off the rental houses has also made us feel really financially secure. Basically, if everything goes perfectly then we will be very financially set for the rest of our lives. But even if some things don’t quite work out as planned, I still think we’ll be fine.

Now, that being said, our current level of savings is high, which leaves us using every penny each month, and that’s stressful. To meet our financial goals takes a lot of fancy footwork sometimes. I feel like I need to be “responsible” constantly. With three kids (especially at these ages), unexpected expenses seem to be the norm. I’m constantly juggling money around in order to maintain our budget and savings goals.

For example, if an unexpected activity expense comes up, I tend to do things like reduce our grocery or going-out-to-eat budget to cover that expense and not break into savings. I sometimes wonder if it would feel better to free up some money that we are saving just to give us a monthly cushion. But then I think that I’d probably just spend that on something else random, leaving me feeling the same as before.
How is your financial situation or approach different from 5/10/15 years ago?
It’s dramatically changed over the last five years. Purchasing the three rental properties during Covid using equity from our house and taking advantage of the really low interest rates feels like a very good decision, though at times it’s stressful to own three houses and have mortgages on all of them. But the fact that we have $2,000 in cash flow from these houses each month makes me feel like we could weather any storm.

In addition, we both have pretty decent jobs with good health insurance, and since we are out of the small-kid phase, we don’t have to think about child care, paying for maternity leave, etc. Also like I said, zooming out to look at our numbers made such a big difference. We contribute a lot to our retirement accounts, and what we have saved at our ages seems pretty good!

Fifteen years ago, I wasn’t thinking a whole lot about money. I was newly married with no kids, and we seemed to be able to live just fine on our incomes. When I started having kids, I really tuned into the month-to-month expenses. I made sure we were living within our means each month. But I had no clue about our long-term future. It wasn’t until I zoomed out to look at the big picture, got serious about our retirement goals, and made a plan to meet those goals that I really became financially confident and also began to feel very competent in managing our money.
What are your money stressors?
I can get very doom and gloom (as can my husband). The state of our world, politics, climate change, etc., can sometimes make us feel like the rug will be pulled from us at any moment. Just the other day I wanted to make a plan for a greenhouse, solar panels, a fireplace, a water-collection system, and a generator at our house in case the world falls apart, and we need to be self sustainable.

I also admittedly don’t really know what college-age children cost. In my mind, they will get scholarships, and our 529 funds will cover the rest (as long as they choose a smaller state school), and they won’t require too much from us as parents. Ha! I know that’s probably not true at all. Our 10-year retirement goal does rely on them being fairly self-sufficient through college.
Do you expect to receive (or have you received) an inheritance from a family member?
Possibly. I think there will be some money coming from my husband’s side of the family, but I’m not counting on it, and his family has a history of living long lives. We have no clue how much they have. My guess is quite a lot. (They own two paid-off houses, and they probably have a couple million invested.) They are so frugal, and I think their intention is that we get an inheritance, but we don’t really talk about any details. We have no expectation and would rather know they are living a wonderful retirement. But once you’ve been frugal for 70 years, I’m not sure it’s possible to stop.
Do you receive any financial support from your family?
We received an interest-free loan to put an addition on our house, which helped a ton. We paid that off in eight years. We also got a financial gift of $15,000, which we put toward a car. I don’t expect anything else in the near future, but who knows?
Do you financially support any family members beyond yourself and your nuclear family?
Not currently. I think my parents may need a little support as they age, but I think between my siblings and I, we probably can handle it.
How do you and your partner split your finances? How did you decide to go that route?
All our finances are combined, and no money is considered mine or his. We are a very cohesive unit and generally have very few money arguments. We got married younger—18 years ago—and honestly never thought about not combining finances. I am a real finance geek, so I manage all the spreadsheets, etc., but my husband is super supportive. We have quarterly money meetings and talk about spending fairly often. We sometimes differ in what we want to spend money on (he would spend more money on gear; I want to save more for the kids’ college), but we are pretty good at talking it out.
What are you willing to sacrifice to meet financial goals?
Great question! I feel like our goal of retiring in 10 years is requiring a lot of sacrifice right now, mostly because of the need for side hustles and the strict budget we live under. Perhaps it’s too much—I think about that often. But on the flip side, I really want to enjoy my young-ish retirement years when our bodies are still capable. I also don’t want to work for seven more years while my husband is retired. I want to do this together. So as of now, I feel good about the sacrifices we are making. I think we live a great life, even if I do need to be really “on it” to make it happen.
What are you NOT willing to sacrifice to meet financial goals?
If my kids ever asked us to stop working side hustles, I would probably stop. And obviously big medical issues could change everything. The picture-perfect plan I have may not come to fruition, and I’m okay with that. But I think aiming toward that plan will get us close to it, even with life’s curveballs.
Tell us about one financial accomplishment you’re proud of.
I am proud of us for jumping into purchasing rental properties. We are generally more cautious people, but we ran all sorts of numbers and felt really good about the plan and just did it! Five years later, it’s working out great, and I’m really proud we diversified our investments.
What was the first “big” splurge you remember making and how did it make you feel?
Probably buying my 2020 SUV. I previously drove a 2005 SUV with 250,000 miles on it. I am thrilled with the new car. Some people don’t like all the technology new cars have, but I love it. I cannot believe I lived without Apple CarPlay for so long!
What is one financial goal(s) you still want to achieve?
I want to travel internationally every year while the kids are home. This only happens thanks to saving our side-hustle money. Traveling as a family of five is so expensive! We just went to Thailand for two-and-half weeks, and it was amazing! Each kid has a bucket-list vacation they get to plan before graduation. While we are still supporting our kids, we want them to see the world.
What do you regret spending your money on the most?
I have a romanticized view of going out to eat. I always want to do it more but rarely am happy I did it. It’s so expensive.
What is one thing you spend money on that makes your life better?
When I started my side hustle, I committed to pedicures. I love them! I get them every other month.
What is one thing you spend money on that drives you crazy?
I am super annoyed at how much our cell phone bill is. I know there are higher bills out there, but gah I hate it.
Is there anything else you would like to add?
While there’s so much coverage of how much daycare costs, no one really talks about how expensive it can be to have adolescents. And there are so many complicated decisions—like do we pay for our kid’s car? We talk to our kids a lot about money—like a lot, a lot. And I don't know if it’s the right amount or the wrong amount. But we just really try to make it clear that we can afford a lot of things, but we can’t afford everything, and we are making intentional choices. For example, maybe their friends are going out for pizza after soccer, but we’re going home for dinner. And the reason is one of the things that matters to us is travel, and we can’t actually do tons of dinners out and also go to Thailand. They seem to be understanding that, but I don’t know. Maybe it will come to bite us. With kids, you can tell them things, but ultimately they are their own people, and one day they’ll have to make their own decisions.