RV Living: How to Make It Without a House

RV living without house
RV living without house

By Gerri Detweiler

Have you ever thought about chucking it all and taking to the road full-time? My hubby and I have, though now we can't seriously consider it until my daughter is out of high school in a few years. But if you're free to roam, you could join some 1.3 million Americans who live full-time in RVs.

To find out what it takes to be able to afford becoming a full-timer, I spoke with Kathy Huggins. She and her husband, John, have been "living the RV dream" for over seven years and host a radio show by that name at LivingTheRVDream.com. I interviewed Kathy for my radio show, Talk Credit Radio. Here are the Huggins' financial tips for a life on the road in a recreational vehicle.

1. Get organized.

While you're traveling, you'll need to have someone receive and forward your mail to you. That could be a friend, relative or a mail service. The Huggins use a mail service located in South Dakota (more on that choice later) that forwards their mail twice a month.

They also rely on online banking and bill paying. Their phone, credit card and satellite dish bills are all paid online. If there is a bill that can't be handled that way, "a hospital bill, for example" says Kathy, "I leave them a note that I only get my mail twice a month, that I may be late and please do not charge me (a late fee)," she explains, adding that she's never had a problem.

For banking, they use direct deposit and a debit card. To avoid ATM fees, they chose a bank that refunds ATM fees and and often get cash back at the cash register when they make a purchase on their debit cards.

2. Have a (flexible) budget.

Does living in an RV cost less, or more, than living in a traditional home? For the Huggins, it's less. Kathy rattled off her monthly expenses: rig payment, phone bill and satellite television for starters. Camping site fees can range from free to $60 to $70 per night, though, she says that they try to keep theirs at $20 per night.

To keep your electric bill down, avoid staying in one place for months because long-term campers usually have to pay for their own electricity. "Stay for less than a month and they pay the electric bill," she says. Even when the Huggins do pay for electricity, it's pretty inexpensive: about $40 per month, or $80 a month if it's cold and the electric heaters go on. "Remember, we're living in 400 square feet," she adds with a laugh. And while many campsites have free Wi-Fi available, the Huggins spring for their own wireless Internet connection because they need Internet access for their radio show. Cooking their own food and limiting meals in restaurants also saves them a bundle.

As with any budget, there are always surprises. For the Huggins, it's been rising gas prices, which went from $2.99 a gallon to almost $4.00 a gallon at the time we talked. "That's been a big change in our lifestyle," she comments, "but we just spend more time in a campsite. We'll travel maybe 250 miles a day at the most and we might stay (in one place) three or four weeks. We use our car, which we tow, to go see all the things that are around here."

3. Save up for your rig, shop for the loan.

I asked Kathy what it costs to buy an RV that would be comfortable to live in year-round. She says a used motor home will run "right around $100,000 if it's a diesel pusher and about $80,000 for a gas rig. And they're pretty comfortable." The other option is to buy a "fifth wheel" that is pulled by a truck. "You're talking about $40,000 to $60,000," she says, but "then you have to buy a truck to pull it, which can be up to $40,000 for the truck."

Before hitting the road, the Huggins sold their Florida home at the height of the market, which allowed them to get rid of all their debt and put a healthy down payment on their rig. Still, they took out a 20-year loan at 4.35 percent for the balance. That was a few years ago, though, and since then full-time RVers have found it more difficult to get loans. "Try a credit union," suggests Kathy. Or buy your rig before you quit your job. "If you're going to be a part-timer, they don't seem to have a problem giving you a loan," she notes.

4. Get a tax break.

One of the advantages of living on the road is that you can call any state home. The Huggins, like many full-timers, chose South Dakota as their home base because of the tax benefits. There is no state income tax and, as Huggins points out, no property tax since they don't own a home. "South Dakota probably has half a million people that don't live there but are full-time RV-ers because of taxes," she laughs. Tax rates and other details are available in the book "Choosing Your RV Home Base."

Read the rest of this story at Credit.com.

See more at Credit.com:
Money Experts Confess Their Biggest Money Mistakes
The Ultimate Credit Report Cheat Sheet
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