My Multiple Incomes Expense Report

Published by in Income Report on April 24th, 2012

my multiple incomes expensesI’ve been getting a lot of questions about my multiple income expenses, so I’d thought I share with you my first My Multiple Incomes Expense Report.  I want to continue to be as transparent as possible, and so here is a breakdown of my expenses, as well as how much time I spend on my various income streams each week.

 

Time Management

Ever since highlighting my multiple income streams, the next question people ask is how much time do you spend each week doing it.  I just talked about the importance of a schedule to juggle everything, but here is a fuller breakdown of the time I spend on each income stream:

  • Investments: 15 minutes per week (not including just reading investment news)
    • This time spent is usually researching individual investments or looking at my portfolio asset allocation as a whole

 

  • Websites: 10 hours per week, or 40 hours per month (this includes all websites and niche sites)
    • This is the time I spend writing, commenting, and technical stuff related to my sites

 

  • Writing Service: 5 hours per week, or 20 hours per month
    • This is the time I spend writing content for others as a freelancer

 

As you can see, I spend about 60 hours per month for my online businesses, and currently about an hour per month dealing with my investments.  If you look at my March 2012 Income Report, you can see that this 60 hours per month breaks down into an effective hourly rate of $35 per hour.  Not too shabby.

 

My Expenses

However, as with any business, I have various expenses associated with running both my online and offline businesses.  Here is a detailed breakdown of my average expenses over the last 6 months.  I average it because sometimes I have more and sometimes I have less, but this average seems pretty close.

Websites

  • Amazon Web Services (Hosting): $4
  • Bluehost (Hosting): $5
  • Software (Aweber, WordPress Plugins, etc…): $29
  • Staff Writers: $130
  • Other Services (Graphic Design, Tech Support): $68
  • Average of One Time Expenses (Buying a new site): $107

Online Sales

  • eBay Fees: $14
  • Commissions: $5
  • Postage: $42

General Overhead

  • Office Supplies: $28

Total Average Monthly Expenses: $432

 

As you can see, my expenses are a little over $400 per month.  However, that also includes averaging in the buying of another website, which skews this metric by $107.  Excluding that cost, my total monthly expenses are roughly $325 per month.

 

I’d be happy to answer any questions you may have about my average expenses!

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The Importance of a Schedule and Time Management

Published by in Business on April 20th, 2012

calendar schedulingI work full time, run multiple websites, and getting a rental property put together, and more!  Needless to say, if I wasn’t organized, I would be pulling my hair out right now!  However, because I take the time to plan and organize, I can usually squeeze everything in that I need to in a day, and still have free time to hang out with my family and walk the dog.

Here are some of my scheduling tips that you may find useful.  I’d love to hear your’s if you have them!

 

Calendarize Everything

For me, it is essential to have everything on a calendar.  Right now I use Google Calendars, and I have several different ones set up.  I have one for my blogging business, which I can keep track of advertising commitments and other things, and I have a second one setup for my family stuff.  Both my wife and I share this calendar, and it is great because when she updates an event, I see it as well.  No more “I told you about XYZ event”, since it’s always on both our calendars.

 

Just Do It!

Another important part of time management for me is just knocking out the small tasks quickly, and not letting them build up.  For example, I try to keep my email to a minimum, and I use folders for longer term items I need to save.  I view my inbox like a quick to do list, and I sort through everything as needed.

If I can knock out a response in less than 5 minutes, I like to do it right there on the spot.

With that being said, it is also important not to over-commit yourself to projects and time lines.  For example, I get several emails a day regarding my writing service.  Sometimes I’m able to deliver in 24 hours, but other times it could be 72 hours.  I try to make that clear and ask up front if that is okay.  I don’t want to over-commit to a deadline I can’t meet.

 

Project Management Software

Finally, for longer term items, I use an online project manager called Asana.  I use this mainly to bucket my projects and sites together, and to list out everything I can think of that I want to do.  I have several brainstorming spaces as well for new ideas that I haven’t developed yet.  Then, I can start assigning deadlines to these things, and start putting action steps in place.

For example, I have a niche site that needs some updating.  I want to update the theme a bit, and get more content.  I then can break that down into content ideas and theme ideas, and finally put deadlines to either write the content or to outsource the writing.

The great thing is that it can sync with a mobile app, and it sends me reminders to my Gmail.

 

Readers, what other scheduling and time management tips do you have that help you balance a lot at once?

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My First Rental Property

Published by in Real Estate on April 17th, 2012

My First Rental PropertyI’ve hinted at it several times, but I am adding a rental property to my multiple income streams.  Actually, I’m going to be renting out my existing house and purchasing another.  As I discussed a bit in my post about Problems With Homeownership, I encountered a bunch of things that were external forces that I had wish I had known prior to moving in.  As such, the house just wasn’t a great fit for my wife and I.  We have since been looking at other places, and decided that instead of selling this home, it would be beneficial to rent it out.  While there is equity and we could sell it for more than we paid, with rents where they are, we could make a nice bit of cash each month on the home.

 

The Pros of Rental Property

The great thing about our home is that, although it is single family, it is in a desirable neighborhood and in a city conducive to renters.  We live in a huge military town, and so we get a large influx of military officers looking to rent single family homes.

This home is also in a great school district, and is 4 bedrooms, so it can accommodate larger families.

A big positive for us is the cash flow.  After comparing comparable rents in the area, we should be cash flow positive on the house.  In fact, we will probably refinance the property and get even more cash flow out of it.  While you never know the rents until the lease is signed, I am pretty comfortable in my estimates.  Once I get the lease signed, I will share the details with you.

A second big positive for us is the house is ready to rent.  We maintained it well, and so no work needs to take place prior to renting it.

 

The Cons of Rental Property

The biggest cons we’ve been discussing are taxes/depreciation, dealing with tenants, possible vacancies.

A big concern of ours is dealing with the taxes and depreciation on the property since we lived there and have now switched to renting it.  I’m sure there are thousands of people in the same situation, but it seems rather complicated.  Plus, if we do sell, what impact will depreciation have on our gains at that point in time.

Second, dealing with tenants can be rough.  I’ve read enough posts about dealing with a tenant from hell to get me a little worried about it.  Plus, there is a big difference when you live somewhere and something breaks, and when you don’t live there and something breaks.  I know that it will be a bit more work on my part to handle issues as they arise, but I think the cash flow will outweigh the extra work.  Plus, I plan to do in-depth tenant screenings to make sure I get the right tenant.

Finally, vacancies suck.  We plan on signing a one year lease on the property, but even with that, I know a vacancy will happen.  As such, it will be important to build up a little reserve prior to relying on the cash flow from the property.

 

Readers, what additional pros and cons should I be considering as I embark on this venture?

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Starting With Side Incomes

Published by in Blogging, Business, Investing on April 13th, 2012

college side jobsThis is a reader story from Tyler, who blogs about student-related personal finance at Poor Student.  He has a very similar to mine and I’m glad he is willing to share it!

I got to university in September and quickly realized that I was going to be hitting the books hard from then on. It was an easy decision for me to not get a part time job while I had classes going on, I simply would not be able to keep up with my schoolwork. But I also noticed that to stay in school I had to have at least a little money. So I did need some money coming in. While I had not read this site at the time I concluded that a similar philosophy of having a variety of ways for money to come in was the way to go for a student such as myself.

Starting With Side Gigs

I had read that there were people who did surveys online and got paid for them, but before that had always seemed like a scam, it was too easy! But I signed up with a couple of sites anyway after reading reviews to make sure that they were in fact legitimate. I have been pleased with this little way to make money. These days students spend a lot of time on their computers anyway, I have taken the time that others might spend on Facebook and started using it to make money. The surveys don’t make me a lot of money, maybe $20 a month.

I had also been lucky enough to have family who use Swag Bucks. This is a site revolving around a search engine that periodically rewards you when you search, and these rewards can be redeemed as PayPal cash, or Amazon gift cards. The site has lots of ways to make money, and this has been a big one for me. I have earned about $50 a month from Swag Bucks, and it has the potential to earn more. I have also used Superpoints.  This is a site where all you have to do to earn rewards, paid through PayPal or Amazon, is click on a button. This one earns me maybe $10 a month, but is practically effortless.

Blogging About My Experience

Then I started my blog Poor Student. I wanted to tell other students that the good financial decisions were not difficult, and that students do not need to resort to seemingly insurmountable amounts of debt to go to school. This has not been the income earner that I thought it could be and may become, but it has allowed me to discover a passion I have for personal finance and helping others if I can.  This has earned nothing of note, but it has a chance to in the future.

Getting Multiple Income Streams

All of those are online streams of income, but I also decided to maybe go outside sometimes and found a way to make side income offline. If there is one thing I enjoy almost as much as money it is getting things for free. Mystery shopping has allowed me to combine those two pleasures. You sign up for an assignment to go to a store and evaluate some aspect of it. It usually entails purchasing something for which you will get reimbursed and you will also get paid on top of that. I have not done this regularly but I could. I did my mystery shopping in a great spurt and got paid over $400 and also got to keep what I bought.

With all the money I had from these I wanted it to also gain me money, so I opened a brokerage account and have begun investing for dividends. So far it has gained me at least $7 a month and has earned me as much as $13. This is only the beginning too, as I earn more money from side incomes, that money will be able to earn me more money from dividends.

I have found all these little streams of income all before I pulled down a full time job. These can all be done even while I work full time during the summer as well. The side incomes are very flexible and can work around any schedule I choose to have.  I am excited to continue with these and add other incomes as I go along. Then it will all fit together after I get a full time job, which is the largest piece of the puzzle. But starting with side incomes means I will be able to select a job I enjoy, and that I will not be dependent solely on that income when I get it.

 

Thanks for sharing your story Tyler!  I’m glad to see you developing multiple income streams early on!  Do you have any other suggestions for Tyler when it comes to developing multiple income streams?

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Calculating Your Costs of a Rental Property

Published by in Real Estate on April 12th, 2012

rental property fourplex costsI’ve been doing a lot of research into rental properties lately, for an upcoming series of posts detailing some changes to my multiple income streams.  Yes, rental property will soon be playing a part in that, and I’m excited to share with you some of the things I’ve learned and have been going through.  The biggest part of that has been looking at the costs, and I want to highlight a general breakdown below.

 

Calculating Borrowing Costs

One of the biggest costs of rental property is the mortgage.  You can use a loan calculator such as this one from HSBC to calculate the costs of your loan based on the interest rate and amount borrowed.  With interest rates so low, you can also look at the effects of what happens if you get a 10 year, 15 year, or 30 year mortgage.

Beyond the cost of the loan itself, you should take into consideration the costs of getting the loan.  You will usually pay 1-2% of the loan amount in closing costs to fund the loan.  These include the costs of an appraisal and for the other documents required.

 

Other Real Estate Costs

Beyond the loan, you will have a number of other costs which you should be conscious of.  These include:

  • Insurance
  • Taxes
  • Utilities
  • Maintenance

For insurance, you should get a different type of policy than a normal homeowner policy.  Most landlords maintain a fire policy on the property (which just insures the structure), and then carry some type of extra liability policy to protect themselves personally.

As an owner, you will also be responsible for the taxes on the property.  These vary by locale, but are usually around 1% annually.  Make sure that you budget for these accordingly.

Next, even if you are having your tenants pay for utilities, you as the landlord will still usually be responsible for some.  Most tenants pay electricity, cable/phone/internet, and even water sometimes.  Landlords usually pay for some of the water and sewer, as well as possibly garbage collection and more.

Finally, you should always make sure that you are saving a little for maintenance each month.  It is an inevitable expense of being a landlord, and having a little reserve is always a good thing.

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