Monday, December 31, 2012

Fear the Stock Market?

I’ve been wary of the stock market for a number of years now. I just think that for the little guy, it’s hard to win these days. Throwing my money into a fund that rises and falls with the overall market trends really doesn’t cut it for me anymore, and picking individual stocks, unfortunately has never been my thing.

As of late, my distrust of the stock market and feelings of wariness have grown. When I hear investment advisors immediately jump on IRAs and 401(k)s as their main form of retirement investment, and tell people to max out their contributions to maximize tax savings, it reminds of the good ‘ol days when the housing market was all the rage. “Buy a home. You have to buy a home. It’s such a great investment!” I kept hearing.

I’m of the opinion that if I hear that everyone is doing or advocating one thing, it’s probably best to step back, re-evaluate and maybe even do the opposite.
If you think I’m a little overly cautious, I’m providing a link here to a great article on NPR taken from the Associated Press about the current state of the stock market to back up what I’m saying. It’s not just me who is concerned.

Friday, December 21, 2012

What I can do with my Lifetime Income Number

I recently wrote an article about calculating my lifetime income needs. Obtaining this number involved looking at my estimated life expectancy, my past expenses, and my lifestyle inflation rate in order to determine what my expenditures would be over the next 45 years. Doing this allowed me to develop an average cost per year, which in turn gave me an overall amount that I would need to hit to continue in my current lifestyle from now until death.

While it’s not a perfect formula, it begins to help me take some of the financial guesswork out of life moving forward. Sure, there are plenty of unknowns; but that’s life. As much as I love to ponder and plan, I’m realistic. I know I can’t plan for everything. But I can plan for a lot.

Here are some of the things that having that lifetime income number helps me do using numbers and examples that don't pertain to my actual financial situation.

My Calculation
First off, here’s a quick review of my previous article and the equation I used to calculate my lifetime income number, using $20,000 (this isn’t my expense number, but it works for this example) as my current annual expense number and 3 percent as my annual lifestyle inflation number over the next 45 years (my life expectancy):

“Personally, I make this calculation by way of a financial calculator that I keep handy on my desk, but it can also easily be done by way of a future value online calculator, by inputting:

Present value: $20,000

% Change per time period: 3

Time periods: 45

Future value: $75,631.92

All things remaining constant, this tells me that my annual expenses could be running in the area of $75,631.92 by age 80 (kind of scary, isn’t it?). If I add that number to the current expenses of $20,000, I find that my expenses will average out to be about $47,815.96 per year or $2,151,718.20 over the course of the next 45 years.”

Looking at Income Needs
Having an idea of how much money I’ll need on an average annual basis can clarify a litany of work-related and career questions. If I know that I should be averaging $45,000 a year to build a secure current lifestyle not only for my family but a secure future and retirement lifestyle for myself as well, but I’m only making $30,000 a year right now, something needs to change. I either need to reconsider my current work situation, find more income streams, dramatically cut expenses or do some combination thereof.

Pulling Out Social Security
So let’s stay with my $45,000 a year annual average as my income needs number over the next 45 years. And let’s say that by using the benefits estimator at the Social Security Administration website, I can determine that by the time I retire, my benefits might be somewhere in the range of $1,500 a month – or $18,000 a year. This means that my retirement funds must provide me with and additional $27,000 to make up the difference. If my savings can’t do this, then maybe I need to reconsider my investment options or I need to pick up some work during retirement or even bump up my retirement age.

Determining Retirement Age
After seeing my income needs and Social Security benefits, I can begin to put a finer point to my retirement age number. Knowing that if I wait until age 70 to retire, that my monthly payments might be $2,000 instead of $1,500, I could wait to take my benefits in order to bolster my retirement income. Or working an extra five years or so could provide me with enough money to increase my income from retirement savings. If nothing else, it might tell me if I need to mix some amount of income earning work into my retirement to supplement Social Security and retirement savings income streams.

Sunday, December 16, 2012

Determining Financial New Year’s Resolutions

Overall, I’m not a big fan of New Year’s resolutions. I tend to believe that goals should be set when and where needed through the course of the year, not just at the start of a new year. However, this doesn’t mean that I’m against them completely, and can’t see the positive aspects behind such resolutions, especially when it comes to our personal finances.

Over the years, and throughout resolution successes and failures, I’ve developed certain rules that help me to develop and achieve my financial New Year’s resolutions when I do set them.

Start Early and with Variety
I find that it’s a good idea to start forming my resolutions in December and sometimes even earlier than that. Waiting until the last minute can leave me scrambling to come up with financial resolutions that might not be the most effective or pertinent to my financial lifestyle or needs.

But just starting early isn’t where I leave my New Year’s resolution preparation. Instead, I consider multiple resolutions that are both short and long-term in nature. Meeting a few resolutions shortly into the new year can provide the motivation to maintain interest, keep pushing to meet my longer-term resolutions throughout the rest of the year, and maybe even set more goals.

Make Resolutions Lofty, Yet Realistic
While I might use certain short-term, simpler-to-meet type resolutions to push myself to attain various goals during the year, I don’t make the majority of my resolutions too easy to achieve. Instead, I like to set certain lofty, yet realistic resolutions to push myself.

What’s the point of setting goals, if they don’t push me to achieve?

Therefore, I utilize a combination of easily met goals, paired with loftier financial expectations to drive me in meeting a tiered goal structure. For example, cutting expenses a little each month helps drive me toward an overall 10 percent expense reduction goal year-over-year, or increasing productivity by an extra 5 percent each week can help me achieve a goal of producing an overall increase in profits for the year of 20 percent.

Make Resolutions that are Pertinent to My Financial Life
I find that it’s important to make New Year resolutions that somehow affect my regular financial life, or if nothing else, build up toward larger resolutions. Just saying that I want to quit a job and start an independent career as a self-employed individual without doing things like investigating my career interests or forming a business plan could leave me with a resolution that’s difficult to attain on its own.

I had leaving my job as a New Year resolution once, but there were plenty of mini-resolutions that accompanied that goal. Yet, by meeting those goals, which included building a business plan, testing out my chosen profession before leaving my job, having an exit strategy, and similar items, I was able to achieve my larger, all-encompassing resolution.

Writing Resolutions Down in an Easily Visible Location
I’ve often seen this sort of rule on other New Year’s resolution related articles, but I feel it’s a good one by which to abide. Writing my resolutions down and keeping them out where they are visible and seen on a regular basis can be important to keeping them fresh in my mind.

This location doesn’t necessarily have to be on a calendar, the refrigerator, or even a sheet of paper. I tend to put my goals on my income/expense tracking spreadsheet -- something I view on a daily basis -- to help me stay on top of my financial resolutions and hopefully ensure steady progress. Just bear in mind that if these are financial goals that are not items you’d like to share with the general public, you might want to reconsider placing them in a visible place at work or some other spot where they might be seen by others.

Tuesday, December 11, 2012

New Blog: Simple Man's Money

Hi there readers!  Wanted to let you all know that I've started a new blog -- Simple Man's Money -- focused on simple saving tips, tactics, and techniques that I use -- or at least attempt to use -- to maintain a simple, low-cost lifestyle.  Feel free to pop by and take a look.  Don't forget to add yourself as a follower while there!


Monday, December 10, 2012

The Cost of Car Ownership

Thankfully, since I work from home, we’re only a one vehicle family. Add to this the fact that we keep costs relatively low by owning our vehicle outright, which means we avoid car payments and any associated interest on those payments. However, owning a vehicle outright doesn’t mean that we still don’t put plenty of money into our vehicle…mainly through the costs of maintenance as our vehicle ages. And with our vehicle now over 10 years old, those maintenance costs seem to be getting higher each and every year.

Here is a breakdown of the costs of our vehicle ownership over the past year, which can illustrate just how costly owning a car can be, even when that car is paid off.

Repairs and Maintenance
While we’re lucky enough to own our vehicle outright, this doesn’t mean that we get off without other costs as our vehicle ages. This year we’ve put over $1,400 into vehicle repairs. For some, this amount could almost equal the total they make in payments each year; and for us, it’s an indication that the time to buy a new vehicle is drawing nigh. Add another $500 for new tires just this week and we’re at about $2,000 this year for repairs and maintenance costs.

Of course it was this year that my wife got a job that required a roundtrip commute of 50 miles each day. And of course, it was this year that gas prices in the Chicagoland area easily exceeded $4 a gallon.

This meant that our gas costs -- excluding summer since she works in a school district -- averaged about $250 a month. With summer costs down to about $100 a month, we managed to average about $200 a month for the entire year, still costing us nearly $2,400.

You’d think that the insurance for our aging SUV would be fairly cheap; however, our annual policy coverage cost for our 2002 SUV is roughly $700 a year. This provides us with a $500 deductible 100/300/100 (thousand that is) limits for bodily injury and property damage, and 100/300 limits on our uninsured/underinsured coverage.

Unfortunately, due to our urban living environment, we end up having to pay for parking. The privilege of utilizing a city parking lot costs us $40 a month. In addition, we must pay $40 for an annual town sticker, pushing our total for vehicle parking related costs to $520 a year.

This means that we paid at total of about $5,500 this year for a vehicle that we own outright. It’s kind of a shocking total considering that we didn’t even have to make a single payment on it, and it’s a good example of just how costly vehicle ownership can be.

Sunday, December 2, 2012

Why Association Fees are Good for Owners Like Me

For years after I graduated college, I had a negative attitude toward condominium living. While I’ll admit that as a condo owner now, I can still see a variety of potential pitfalls and issues with the lifestyle, there are certain things that I truly enjoy. Strange as it might sound, one of those things is our monthly association fee.

Even though I’m a good saver and I could handle the upkeep of our property on my own, having a set $300 monthly fee to pay to cover items such as common insurance, water/sewer/trash fees, exterior maintenance, snow removal, and landscaping, as well as fund a condo reserve account, is great for a person like me, here’s why.

Proper Insurance Coverage
Now I’m not one to scrimp on homeowners insurance, but I’m not going to sink a ton of money into over-insuring a property. I’m more apt to get the standard coverage and be done with it. This means that should a damaging event occur to the property, we’d be covered, but not necessarily covered to the extent of certain other homeowners.

With our condo association though, I’m well covered in this area. With the combination of many individual owners throughout our condo building, we have a much higher liability limit that most of us would likely assume on our own, and this is just made a portion of our flat monthly association fee.

Preventative Maintenance and Upkeep
While in our previous, single-family home, I did pretty well at maintaining our property through a lot of do-it-yourself type projects, it’s kind of nice to have someone take care of many such aspects of home maintenance for us. It was always hard for me to take on preventative maintenance work in our previous home. I hated spending money on things if they were still working, being more of the mindset of waiting (if possible) until they broke completely to fix them.

However, such an attitude isn’t always the best one to take, and while it can save money in the near-term, it can end up costing money in the long-term. This is why it’s nice to have regular maintenance projects such as tuckpointing, drain rodding, door repairs, cleaning of public areas, landscaping, and similar items that I’m forced to pay for whether I would have done them myself or not, thus maintaining the appearance and quality of our living location without forcing me to make decisions upon what I’m going to fix, when, and how much I’m willing to pay to do so.

Repair Reserve
Even when I set money aside for a repair or a repair fund, to me, it’s still like it’s saved money and part of my asset total, so it doesn’t make it any easier when I eventually have to spend that money on repairs. This is why I really like paying our association fee. It takes that ability to choose whether or not I want to spend the money on repair work out of the equation, plus it acts as a communal pot into which we can all pay to fund larger projects down the road.

This means that when it comes time for new windows, a new roof, or similar big-ticket repairs, I won’t be left “going cheap” on the cost of the repairs and getting a lousy product in return. And since our association fee goes to fund a general reserve for such items, it makes for great peace of mind knowing that by the end of 2013, that fund is projected to be at nearly $200,000, which can go a long way in funding repair work for which I won’t have to pay any additional funds.

Tuesday, November 27, 2012

Financial Calculators I Use to Help Us Save

I’ve been a long time fan of financial calculators. These helpful tools have led me find all sorts of valuable savings or ways to save, and they have assisted me in making a variety of financial decisions for our family. In fact, I’ll venture to say that various financial calculators have helped to save and/or make us thousands of extra dollars over the years.

The following are some of the financial calculators that we’ve used and how they’ve managed to save us some serious cash as well as helped us plan for the future.

Once we had obtained our mortgage, we could use the amortization sheet that our lender provided us with to help determine what we would pay over time. However, before this point, we wanted to know what we were looking at for costs when it came to different mortgage amounts, interest rates and time frames.

Utilizing mortgage calculators to figure out interest costs over time helped us cut thousands of dollars in interest off our loan amount. Rather than going for a 30-year, fixed-rate mortgage on a higher loan amount, we instead put more down on our home, and took on a 15-year mortgage.

While the monthly payment amounts were higher with this type of mortgage, by taking on a shorter term mortgage, we would effectively be able to cut the interest we owed over the course of the loan’s life in half. And knowing that by taking on a 15-year mortgage, we could cut our interest rate by nearly a full percent compared to a 30-year mortgage, we realized that we could shave thousands more off our mortgage costs over time.  Eventually, such knowledge allowed us to become mortgage free altogether.

Social Security
I’ve recently started a spreadsheet to track our annual earnings and in turn make keeping up on our Social Security estimated benefit calculator a little easier. The calculator into which I plug our income information is found at the Social Security Administration’s website (, and it requires data such as our dates of birth, age at retirement, how we’d like our estimates presented to us (either in today’s dollars or future dollars that have been adjusted for inflation), and income information.

This way we can get a good feel for what our benefits could be upon retirement, and plan for a reduction in those benefits by a possible 24 percent or more should the system not be “fixed” in several decades.

Self-Made Calculators
I have several calculators that I’ve created myself to help me determine and better plan for various aspects of our personal finances. The first of these calculators is a tax calculator. While this isn’t so important for my wife, it is important for me as a self-employed individual. Using this calculator allows me to keep an eye upon how much in self-employment taxes I owe at any given moment, and it keeps me from falling too far behind in accruing extra cash to make such payments.

The second self-made calculator is one that tracks our net worth. It not only breaks down available secure assets such as savings, bonds, certificates of deposit, and cash, but it also includes non-guaranteed assets such as our retirement accounts, loans to family members, and home equity (when we owned our home), and factors in any liabilities such as our mortgage (again, when we owned our home), and any outstanding debt.

The secured assets comprise one total, the non-guaranteed assets another, and then we have a combined total for an overall net worth once our assets totals are relieved of any liabilities. We update this calculator regularly, and it allows us to stay apprised of our overall financial situation at a moment’s notice.

Friday, November 23, 2012

Home Projects We Undertook Immediately After Buying our Home

Some things are just easier done before getting completely settled into a home. There were certain projects that we had on our “home to-do” list that we wanted to accomplish before we found our home spaces cluttered with boxes, furniture, and other furnishings that came with the move-in process.

Therefore, we took a couple days ahead of when all of our stuff arrived to knock out a few projects we wanted to undertake in the spaciousness of our new home.

Deep Cleaning
We certainly wanted to give the house a good going over cleanliness wise before we started to clutter up spaces with boxes, sofas, mattresses, and all the rest. Cleaning a home is just so much simpler when you don’t have to work around furnishings. We didn’t have to worry so much about spilling cleaning solution on upholstery, maneuvering around vases and dishware, moving certain items back and forth to clean behind them, and otherwise dealing with awkward cleaning situations.

We could just come in with our mops, buckets, sprayers, and rags, and have at it without having to fumble over and around all our possessions.

Carpet Removal
We had some less than favorable looking carpet in our master bedroom upon arrival. While I’ve got quite a bit of experience cleaning carpet from my time spent in the hotel business, I’m willing to admit when I’ve met my match. Seeing as how the carpet really wasn’t worth saving, and that it this bedroom was the only room on the first floor that didn’t have its hardwood floors exposed, it was an easy decision to pull it up.

Underneath we had nice hardwood flooring that looked even better with a good cleaning and some polishing. The job was made easier by the fact that we didn’t have to work around the dressers, nightstands, and a king-sized bed that would soon arrive.

Carpet Cleaning
Speaking of carpets, we decided that we’d like to give the upstairs and finished basement carpets a good cleaning before we got settled in with all our furniture. Therefore, we spent about $35 to rent a carpet cleaner from the local grocery store, buy a little carpet shampoo, and I set to work giving the carpet a good going over, not having to worry about moving furniture back and forth, missing areas due to oversized furniture pieces, or hurrying the drying time of the carpet in order to be able to move furniture back into a more livable arrangement.

Monday, November 19, 2012

Adjustments that Made our Home More Marketable

When selling a home, it can be difficult to know where to start when trying to make it more marketable. Do you tackle the outside curb appeal? Do you focus on the interior spaces? Or do you work to accommodate some combination thereof?

Personally, we settled on the latter option, deciding to focus on several areas both inside and outside our home.

Mulch and Yard Maintenance
It doesn’t always take a huge investment to make a yard look presentable. In our case, some weed pulling, a bit of sidewalk edging, a good lawn cutting, a little shrub trimming, and 10 bags of mulch that we’d purchased on sale during the winter for $1 a bag, had our yard looking pretty darn good.

During the point at which we were preparing to put our home on the market, our back porch awning looked terrible. It was a canvas covering on a steel frame, but the canvas had torn at one side and the rip had progressively worked its way along the entire edge, making the canvas droop and all-in-all look pretty pitiful.

This was the entrance through which prospective buyers would be entering our home. Therefore, we paid $450 to have the structure removed, the steel sandblasted and repainted, and the cover replaced with new canvas.

Garage Roof Repair
When we bought our home, the inspector noted that the condition of the garage roof was less than favorable. It had three layers of shingles that were crumbling and in need of replacement.

While the roof managed to hang on until we decided to sell three years later, it was an eyesore and needed to be fixed. Therefore, before our home hit the market, we spent the money to have the existing layers of shingles ripped off and a fresh layer put back on. It cost us $1,340, but I think it could have cost us more should we have negotiated a credit for the repair during the sales process or should it have turned off potential buyers to the point that they never made an offer in the first place.

Paint Touchups
We didn’t do a ton of painting in preparation for our home hitting the market, but we did want to at least do a few paint touchups here and there. We really didn’t want to go repainting entire rooms since we couldn’t be sure if our paint selections would be more or less appealing to potential buyers. However, with extra paint we had leftover, we went around and touched up existing painted areas to cover scratches, dings, repair work we had done, and similar negative eye-catchers.

Window Treatments
One of the final adjustments we made to our home in an attempt to make it more marketable was to make some changes to our window areas. We spent a couple hundred dollars to buy several new, crisper, cleaner looking blinds for our bedroom and dining room areas and added some sheers in the master bedroom and a window treatment over the dining room window in an effort to add a little character to the spaces. We also removed the dated vertical blinds in the dining room to give the space a newer more updated feel.

Tuesday, November 13, 2012

5 Moves that bring us Financial Peace of Mind

Money can bring with it plenty of worries. But not having the proper financial safeguards in place can bring worries of its own. While we can’t prepare for every financial situation that may befall us, there are certainly ways that we can at least improve our financial peace of mind. And while achieving such peace of mind might not happen overnight, by working through certain steps or knowing what sorts of tools are at our disposal to better protect our financial lives and assets, we can help safeguard ourselves against a variety of potential issues.

Becoming Mortgage Free
I’m not a fan of debt. While I know that sometimes it’s tough to avoid, this doesn’t mean that we can’t try. A mortgage is the one aspect of our debt-related finances that is especially difficult to avoid due to the cost of many homes. However, I never liked the fact that such a payment was there whether we were able to afford it or not; therefore, we downsized our home and bought a space that we could afford outright. This allowed us to avoid mortgage payments and gave us a little breathing room and extra peace of mind in our financial lives.

Debt Avoidance
Debt is one of those things that can not only weigh on our minds but can eat into the strength of our financial resources. Unlike a mortgage, items like credit card debt may have little positive outcome other than enabling users to delay the eventual payment for purchases. The problem is that this delay can come with excessive interest payments and worry over the making of those payments. We’ve been debt free since we paid off my wife’s student loans several years ago. It’s a wonderful feeling and provides peace of mind as well as other options to consider for how to make use of our money in more productive and positive ways.

Emergency Fund
We just never know what kind of curve balls life is going to throw us, and having an emergency fund in place can help us deal with those curve balls. Our family tends to at least try to keep an emergency fund of $5,000 available, which has helped us deal with everything from a broken flood control pump and preparing our home for sale, to purchasing our new home and helping to cover the birthing costs of both our children. Having that backup fund has come in handy in a number of instances and it provides us with a little extra peace of mind even when we don’t need it.

Insurance Coverage
The thing about insurance is that it’s one of those costs we hate to pay and may rarely use, but it sure is nice to have when we really need it. From automobile coverage to health, dental, vision, and even identity theft insurance, our insurance makes a huge difference in the amount that we might have to pay for such items otherwise. For example, our last family dental bill would have been almost $1,000, but with our insurance coverage, we paid $0. A car accident that would have cost us over $5,000 in repairs ended up costing us just the $500 insurance deductible.

Emergency Supplies
From extra food and water to a propane fueled cook stove, batteries, flashlights, and similar items, we’ve found that spending a little extra cash to provide us some emergency supplies helps make us feel better about the future. It didn’t take much -- only about $300 in fact -- to get a multi-month supply of food, water, and additional supplies added to items we already had on hand and that set us up comfortably should an emergency of some sort befall our area. It wasn’t a big investment to make to ensure a more comfortable sleep at night through additional peace of mind.

Wednesday, November 7, 2012

Pulling Double Duty Until Ready to Pull the Self-employment Trigger

There was no one there to tell me whether I was ready to make the move to self-employment. There were no set guidelines or rules in place to indicate if I was indeed as prepared to make the move as I needed to be. And there was no practice run to see if I had what it took to do the job until I pulled the trigger…or was there?

While I had taken the time before I left my regular employment to budget, develop a multi-year business plan, and save an emergency fund to allow myself to make the transition to self-employment, there was another move I made to ensure that I was as prepared as possible to make the self-employment leap. This move consisted of pulling double duty for several years before actually making the transition.

Here’s how I did it.

Train Ride to the Future
I didn’t make the move into self-employment as a freelance writer until late 2007. However, I started writing well before then. I actually began writing as a way to work on a book idea I’d had and fill time spent on Chicago’s commuter rail system on the way in to work back in 2005.

My morning commute actually started at night (since I worked the third shift at the time), but that’s neither hear nor there. I would use the time to write (yes, I actually wrote longhand since I didn’t have a laptop at the time) and practice my trade.

While that book never came to fruition, I look back at it now and realize that it was the spark I needed to light the fire that eventually became my self-employment passion.

Using Regular Work as a Resource
I didn’t let on to the fact that I was interested in becoming a writer to many -- if any of my co-workers -- until I knew for a fact that I was making the transition. First off, I didn’t feel it was a great idea letting people at work know that I was interested in pursuing a career other than the one in which I was currently employed. Second, I certainly didn’t want to count my chickens before they were hatched. And third, I really didn’t want people asking me about my writing all the time. Therefore, I largely kept my self-employment dreams to myself.

This didn’t mean though, that I didn’t use my workplace as a valuable resource while I was there. I did this in several ways:

• As a steady source of income necessary to eventually fund my self-employment efforts.
• As a source of information from co-workers and clients to be used as fodder for my writing career.
• As a foundation and credential (since I worked in finance at the time) for my future as a personal finance writer.

Finding Extra Work Hours
Coming home at night from a long day at work meant that I wasn’t always in the mood to write…but I did. Add into this mix a newborn son and you can imagine that the circumstances surrounding the time in which I was preparing to move into the self-employed world were certainly hectic. In fact, if you throw becoming a new father into the mix, I was actually pulling triple duty in an effort to enter the world of writing.

However, each night (once I switched to the day-shift) after I got home from work, before we ate dinner and gave our baby son his nightly bath, I would spend and hour or so working on writing projects. My grandfather used to do this in the morning, getting up at around 4 a.m. to write before going in to work when he was struggling to make it as a writer himself.

While this schedule wasn’t easy, it prepared me in the years leading up to my self-employment move for what was to come, and it helped me ensure that I had what it took to make a career out of writing and that it wasn’t just some phase or passing interest.

Saturday, November 3, 2012

Our FEMA Experience

When our area was hit by eight inches of rain in one night and was declared a disaster area, the last thing on my mind was looking for help from the government.  Thankfully, our home didn’t suffer much damage from the storm, but the pump for our flood control system had burned out (an $800 repair) due to the beating it took during the storm.

At the urging of others though, and even our local officials, who said that anyone who experienced any storm-related damage should talk to FEMA (it turns out, the more damage reported by residents, the more the municipality would receive in federal money, or something along those lines), we decided we should go and actually hear FEMA tell us “no” so that we could get everyone off our back.

We Just Had One Simple Question
We thought our trip to see FEMA officials would last about five minutes.  We had one simple question, and we thought we already knew the answer.  We just wanted to see if the replacement cost for our pump would be covered, since it was indeed storm-related damage.

So we figured we’d just go in, ask our question, and likely be on our way, since we guessed the answer would be “no”. 

But it wasn’t that simple.

The Process
When we arrived to the area school where the temporary FEMA offices were located, we were directed to a waiting area where we sat for about 10 minutes.  Then we were shuffled off to an area with a row of telephones where we had to register with FEMA.

I told the person taking our information over the phone that we just had one quick question, but this revelation didn’t stop the registration process, which lasted about 15 minutes.  We were given a FEMA registration number (or something to that effect) and told to see the next person at a series of stations that were set up around the room.  This station, as I recall, did something along the lines of explaining all sorts of inapplicable information to us over the next 10-15 minutes, before sending us on to the low-interest loan lady.  

A Loan Interest Loan?  What? Why?
We spent the next 15 minutes listening to what seemed to be a sales pitch regarding low-interest government loans.  We told the lady we didn’t need a loan, but she proceeded to tell us that her mother always said, “Even though you don’t need it, you might want to take it just in case.  It’s better to have it and not need it, than the other way around,” or something like that, I’m really not sure since I wasn’t listening very closely by that point.  

She said these loans were great deals with interest rates in the two to three percent range and that we might want to do some updating to our home with the money even if we didn’t have any storm damage.

We finally escaped the “loan lady” by adamantly telling her we really weren’t interested and didn’t need or want a loan.  We then got to move on to the next station in line, which was manned by the guy that dealt with water-related damage.

The Final Answer…Frustration and Waste
Finally!  We had someone who would listen to our one simple question: Was the cost of our pump replacement covered by FEMA?

His first question was whether we had taken the repair to our insurance company, which we hadn’t.  First off, I was just planning to eat the cost of the repair in the first place, and secondly, we had a $500 deductible on our homeowners insurance.  For an $800 repair -- and the cost of the likely resulting associated rise in insurance premiums -- I didn’t think filing a claim was worthwhile.

The FEMA representative then explained that FEMA covered dwelling issues and didn’t really handle exterior damages or something to that effect since again, I wasn’t really listening by this point.

But he didn’t stop there?  Oh no.  He told us that he could have an inspector stop by if we liked.

“Why?” I asked.  “Wouldn’t it just be a waste of everyone’s time?”
He replied that more than likely it wouldn’t do any good, but just to double check, he could have it done.

I assured him that it wasn’t worth it.  But our hour spent exploring the wacky world of FEMA wasn’t a complete loss.  It was certainly a learning experience and the representative gave us several plastic FEMA cups and a FEMA activity book for our son.  Hot damn! 

Monday, October 29, 2012

Simple Ways I Save on Office Supplies

As a freelance writer, office supplies can play a big part of my regular expenses. From the cost of paper and ink cartridges, to bigger ticket costs like printers and laptops, the amounts and costs of such supplies can vary from year to year. However, I tend to look at these expenses as just the cost of doing business, and in all honesty, as a self-employed individual, I can’t complain too much, since some small business owners experience much higher supply costs.

Still, that doesn’t mean that I have to resign myself to paying full price for such items and that I can’t look for ways to save. And over the years, I’ve found some pretty simple ways to cut back significantly on my office supply costs.

Ink Cartridges
For several years, I thought that I was doing well by using ink cartridge refills that I could get at office supply stores and that allowed me to cut my costs by more than half. I was typically able to get cartridges that would cost me about $25 brand new, refilled for about $10.

Eventually though, I saw one of those self-refill kits at a local convenience store. I wasn’t sure about the success of such refills, but I decided to take a chance and give them a shot. By doing so, I found that I could quickly and easily do my own refills for about a quarter of what I was paying before, being able to get four self-refills for around $17, which left me stretching my office supply dollar in this area even further.

Beyond ink cartridges, paper is probably the second greatest regular cost on my office supply list. As a freelance writer, you can only imagine how much paper I go through at times. Therefore, there are several things that I do to cut costs. First off, when doing things like printing for re-reading and editing purposes, I often use both sides of the paper, which allows me to cut my paper consumption in half. Then, I will often shrink the font, change to “landscape” page layout, and set each side of the paper to contain two pages, therefore adding even more words and additional pages to each side of the paper and allowing me to cut my usage -- and therefore, my costs -- in this office supply area even further.

Tracking for Tax Purposes
As a self-employed individual, I track and save receipts for all my work-related office supplies. This means that when tax season roles around, I’m better prepared for doing my own taxes and have the necessary documentation to give an accurate accounting of my business-related tax deductions in this area. Then I can use this amount on Schedule C of my taxes to help me determine my net profit after deductions from my work and in turn lower the amount of taxes I owe in this area.

Clips Rather than Staples
I rarely use staples any more. While they might not be super expensive items on my office supply list, staples are items that I still have to pay for and that I can’t reuse. Therefore, I’ve attempted to get away from using staples in preference of paper clips and binder clips instead. While it might only add a few bucks here and there to my office supply savings, as a self-employed individual, every little bit counts.

Wednesday, October 24, 2012

Our Halloween Planning Guide

For as long as I can remember, I’ve gotten excited for Halloween. I usually start getting into the decorating mood around late September, which means that our home is prepped and ready come October 1st. Our planning for Halloween comes with a bit more than just the standard picking out of a costume for our son and making sure it fits. Of course those are integral parts to our Halloween preparations, but there are often other steps involved in our planning process, especially now that we have a five-year-old and our candy routes are extremely important.

When it comes to our pre-preparations for Halloween, there are a few key activities to which we attempt to stick. First off, there is the matter of the candy bucket. While a plastic bag or a one-gallon ice cream bucket would work, would that really be getting into the true Halloween spirit of things? Therefore, we tend to get one of those plastic pumpkin or ghost Halloween candy buckets. If we don’t have one left over from last year, the local resale shop nearby typically has a slew of them for a quarter or 50 cents a piece.

And while we might have our costume already picked out, here in the Chicagoland area, Halloween time can be accompanied by some pretty chilly temperatures. Therefore, we have to make sure that if the costume is not warm enough on its own, we have some cold weather undergarments available to keep our son from getting cold while out collecting his candy.

A Candy Plan
We start off our candy plan by having a conversation with our son about limits and candy intake amounts before we head out. This leaves no confusion when it comes to how much he is allowed to eat either on Halloween or the following days and weeks to come since I know what a temptation it can be…even for mommy and daddy.
I’ve learned that with our son, such treats are often best kept out of sight and out of mind. If we keep a big bowl of Halloween candy out on the kitchen counter or dining room table, it’s a constant reminder and temptation. Therefore, we usually put such items up high on the refrigerator or in a cabinet and out of reach to keep temptation to a minimum.

Schedules and Routes
We get our Halloween schedule organized well in advance to actually heading out. For us, as I’m sure it is for many families, we have multiple Halloween events in multiple locations and times. We have grandma and grandpa who want to see their grandson in his costume, and the customary trick-or-treating in their neighborhood. There is of course trick-or-treating in our own neighborhood. Then, our town does a candy walk in the business district with many local stores, restaurants, and other businesses participating. Therefore, by checking online for looking for fliers posted around town, we tend to get a head-start on planning our routes, dates, and times well in advance to make sure we accommodate all the necessary Halloween obligations.

Monday, October 22, 2012

Easy to Become a Freelancer, Harder to Stay One

I found it super simple to fall into my freelance work role. Quitting my job was a snap. Sure, I gave plenty of notice, trained my replacement, and had some qualms about leaving the only career I’d ever known in an attempt to try my hand at something with which I had no experience, but hey, I’d rather take a chance than to be left wondering if I’d been able to do it or not.

The problem with this scenario was that while I was willing to train the guy who was replacing me at my previous job…there was no one to train me as a freelancer. And as I was about to find out, it was certainly easier to become a freelancer than stay one.

Short-term Issues
There were numerous hurdles that I began to encounter as soon as I left my regular work role. There was a significant cut in pay -- not to mention benefits -- with no clear path to replace that lost income. There was however, very little drop in my expenses, meaning that I had to bridge the gap between income and expenses with work that I had not expected to do. Building up these income streams took time, and in the meantime, I had to cut expenses to the bare minimum.

But there were also other issues that I began to realize came with my move that I hadn’t fully considered the effects of before I left my previous work role. The loss of perks like free lunches, free dry-cleaning, free downtown parking, and even just the loss of regular social interaction with co-workers started to settle in upon me. There were no longer employer-sponsored health care or retirement plans. And I quickly began to lose many of the network contacts I once had, which became a concern as I began to contemplate whether it would be as easy as I thought to reenter the field I left should it become necessary.

Longer-term Issues
But I was soon to find that those initial hurdles would be nothing compared to the issues and questions that I’d be facing about my career choice over the next five years.

First off, there was the question of Social Security. No, it wasn’t the fact that I had to pay both sides of the employment tax for this aspect of my retirement (although that was certainly a factor); rather, it was that my greatly reduced income was cutting into my potential future income from this retirement benefit. Add to this that not only was I not getting the employer’s contribution to a sponsored retirement account, but due to my miniscule gap between income and expenses as a self-employed individual, I was no longer able to contribute to such a fund. My decision to become a freelancer was significantly impacting my retirement future.

Next up, there was the uncertainty that came with the role. Sure, income levels fluctuated, but it was more than that. There was the career future uncertainty as well. In my previous role, there were clearly defined roles, career paths, annual evaluations, bonuses with set goals, etc. In my new role as a freelancer though, very few things were set. Answers to questions about whether I should stick it out in my freelance career or go back to a more stable job, whether I should try new lines of work and income relating to my current role or stick with what was working at the moment, and similar questions were only to be answered by time, hard work, belief in myself, and perseverance.

Therefore, if you’re thinking about moving into a freelance or self-employed role, I’d say think hard. Don’t just consider the freedom that comes with such a role, but think about all the other things that may come -- or not come -- with being self employed. And don’t just consider the immediate effects, but the long-term effects that can come with the move into the world of freelancing.

Thursday, October 18, 2012

Finding Happiness Saves Me Money

The game of life can be one continuous learning experience filled with plenty of self-growth. Part of life’s education for me has come in the form of learning what makes me happy when it comes to my life, lifestyle and personal finances. While certain people might find that happiness costs money, in some cases, it might actually help save money. Understanding what makes me happy, actually helps keep my costs relatively low and makes me a stronger and more financially independent person, which in turn, makes me even happier.

Home Life
I’ll admit, I’m pretty happy being a homebody. I work from home. I take care of the kids from home. And while I like a good dinner or night out with the wife occasionally, it’s not something I have to have on a consistent or nightly basis.

This positive outlook of spending time at home saves us money in a number of areas. First off, we save on the cost of a second vehicle since I can work from home. Without even factoring in the cost of car payments, the initial outlay for the vehicle or depreciation, we likely save between $1,500 and $2,000 a year on insurance, parking, gas, oil changes, and regular upkeep and repairs.

Similarly, since I’m at home, I’m also able to care for the kids, which adds significantly to our savings. With child care costs often running between $10,000 and $14,000 a year -- not to mention the costs of transporting the children between home and outside care providers -- you can see how this saves us huge amount of money on two kids.

While my income took a significant hit when I moved from hotel finance into a self-employed role, I love my job and the freedom it provides, and I’ve made up for this income loss in other ways. I’ve already mentioned one of them, childcare. And then there are other savings on things like meals out when at work, and costs related to working outside the home like work attire, transportation costs, and similar expenses that likely add up to thousands in savings each year.

On transportation alone, I save about 10 gallons of gas a week compared to my previous commute -- or at today’s prices in the Chicagoland area, about $2,000 a year -- and about $1,450 from when I used to take the commuter train.

Downsized Living
I really don’t like the accumulation of stuff. It makes me feel good to live a downsized lifestyle in which I control possessions rather than the other way around. From resale options to reducing the size of our home, finding what makes us happy by way of reducing the stuff around us has ended up saving us money.

For example, our previous home was costing us nearly $2,700 a month to maintain (including utilities). However, the time effort and money that was going into maintaining this home was not something that made us happy. Therefore, we sold; downsizing considerably to a much smaller condo in an area that we love and in a home is averaging about $900 a month to maintain (also including utilities).

And by doing things like having regular garage sales, taking things we no longer want or need to resale or consignment shops, and donating other goods to charitable organizations, we often recognize hundreds of dollars in extra income and/or savings each year.

Thursday, October 11, 2012

Self-employment is a lot like Gambling

The desire to gamble runs in my family. Personally, I enjoy gambling as well; however, I hate losing money, so I tend to restrain my tendencies toward the habit. However, I realize that as much as I stay away from gambling in its purest form, I manage to let it slip into my life in other ways.

I recently came to the realization that in my chosen career as a self-employed individual, many of the characteristics of gambling are present. This made me ponder just how much self-employment can in many ways be a lot like gambling and how I’ve done my best to minimize risk in my career and avoid that “losing money” aspect of gambling that I dislike so much.

Putting My Bankroll on the Line
I put quite a bit of time and effort into saving up enough money to bankroll my self-employment dreams. Just having such a fund though didn’t mean I had to move into self-employment. I could have saved that money for retirement, put it into buying a home or just gone on a nice long vacation. Instead, I put my bankroll on the line, risking it in an effort to make a success of my self-employment dreams.

Even a career that was relatively easy to move into such as freelance writing still came with expenses. There was the cost of giving up my regular income, yet still having to cover regular living expenses. There were office supply costs, mailing costs, technology-related costs for things like a printer, laptop, software, and similar expenses. And there was no guarantee of getting this money back unless I succeeded in my chosen role, so it really was a gamble.

The Daily Scratch off
Once I was assured of making it in my career transition, the gambling aspects of my self-employed career -- while still there -- weren’t as dangerous to my financial situation. Instead, they became somewhat enjoyable. As I grew into my role, I began to form multiple income streams through various customers and employers to hedge against failure in any one or two individual income streams.

As these streams became viable sources of regular income, I began to look at them kind of like low or no-risk scratch off lottery cards. Each day, I could log into my email or employment site for which I did work to discover my “winnings” or earning totals. There was -- and still is -- an expectant excitement that came with finding out just what I’d earned that day from income sources such as my blog, my e-books, and various websites for which I freelanced.

Knowing When to Hold Them and When to Fold Them
Maybe the most difficult gambling-related aspect of my self-employment work -- since I’m my own boss and make all the decisions regarding the future course of my career -- is knowing when to fold my hand and call it quits on certain income steams. Tracking my individual income streams and sources over time so that I can gauge their success -- or lack thereof -- helps me know whether or not to continue plugging away at them or pack it in and call it a day.

There are only so many hours in the day for a self-employed individual. And seeing as how I have other duties as CEO, CFO, tax accountant, marketing exec., at-home dad, and all the rest when running my own show, I have to make informed decisions regarding where and how to allot my time. I do this by using my experience and knowledge of past performance to decide whether certain sites, lines of work, and income streams are viable and worth continuing or if I should fold my hand and wait for a better one on the next deal.

The Difference is…Control
Control is the big difference between gambling of the casino sort and that found in my self-employment experience. When I go to the casino, I can determine how much I gamble, which games I play, and how much I spend at each; but when it comes to the actual odds of success at each game -- since I’m not a professional gambler -- I have, in most instances, very little control over the outcome.

With self-employment though, I can better affect my chances of a successful outcome in my work through my marketing, relationship building with clients, continuing my work-related education, branching out into related income sources (blogging, e-books), etc. So while my self-employment does share characteristics with gambling, it’s a form of gambling in which I can minimize risk through my actions and better control the outcomes of my “bets” through my efforts and the decision-making abilities.

Monday, October 8, 2012

Knowledge that Helps Me Do My Own Taxes

I’ve been doing my own taxes for nearly 20 years now, so my tax related knowledge has been given time to grow and evolve slowly over those two decades. I have added to and built this knowledge a little bit at a time, moving from a 1040EZ form in my teen years, to a regular 1040 with multiple schedules and attachments these days.

While I’m not claiming to be a tax professional by any means, I’ve found that having knowledge regarding certain aspects of my personal finances, helps to do my own taxes each year.

The Ability to Follow Directions
Sure, following direction sounds simple right? But for many people (especially some men I know) it’s not that easy. They’d prefer to just jump into a project without reading the instructions, and doing that with one’s taxes could lead to some major issues.

I methodically read the directions for most steps involved in our state and federal taxes each and every year. Just because I assume the steps will be the same as last year, doesn’t mean they will be, and even if they’re similar, even a slight variation could throw my numbers off or cost me a valuable deduction if I’m not paying attention and aware of the instructions.

Introspective Finances
Knowing our family’s own financial situation also helps me do my own taxes. Again, this might sound like common sense; however, having a good grasp upon things like our overall combined income, investment returns, and possible deductions we might be eligible for such as mortgage interest, student loan interest, child credit, self-employed health insurance premiums, and similar items, makes it easier when tax time comes to gather all such information together and ensure that I have everything ready and prepared before I begin.

Financial Tracking
Not having to scramble at the last minute to collect all of our tax information and documentation certainly makes things a little easier come tax time. By keeping up with tracking and retaining information related to income (since I’m self-employed), taxes owed, deductions related to charitable donations, business expenses, and similar items, and keeping such information in an easily located and reviewable file, I make my tax life come year’s end, just a little easier to handle.

Keeping Up with Changes to the Tax Code
While I don’t spend hours studying the U.S. tax code each year, I do pay attention when I read about adjustments to certain items that may affect the taxes we pay. For example, the payroll tax reduction has paid off by boosting our income, and it will make a difference in the amount I withhold as a self-employed individual. Also, there was an increase in the Illinois income tax rate from 3 percent to 5 percent this past year, which might not seem like a lot, but it’s a 66 percent increase over the previous year, so it could mean a big bump up in how much we pay.

Having a grasp upon such changes as they occur takes some of the surprise out of tax time when I suddenly realize that certain things may have changed -- either for the better or worse -- compared to last year.

Having a Tax Background
No, I don’t have an education related specifically to taxes or tax law, but by doing my own taxes since I was a teenager, over time I’ve evolved my tax education as my tax needs and situation evolved.

Starting doing my taxes at a young age -- when my tax situation was much simpler to understand and handle -- built confidence in being able to complete the task of doing my own taxes each year and took some of that fear that many people encounter with completing such a task, out of the equation. Every year, I’ve had to learn something new relating to my taxes, which was nice in a way since it didn’t come as a shock having to learn it all at once. As my tax requirements grew and evolved, so did my tax background, which allowed me to build my knowledge regarding a variety of tax issues over the years.

I’ve already helped one of my brother-in-laws start to learn how to do his taxes, and I plan to start my own son on a similar path to mine early on so that he’s competent to do his own taxes as well.


The author is not a licensed financial or tax professional. The information provided in this article is for informational purposes only and does not constitute legal, financial or tax advice. Any action taken by the reader due to the information provided in this article is solely at the reader’s discretion.

Saturday, September 29, 2012

Our Recent Downsize: Great Practice for Retirement

When I hear the word “downsize,” I’m often hit with thoughts of life down the road. Once the kids head off to college or we’re getting ready to retire, that’s when it’s time to downsize, right?

Well, we don’t necessarily have to wait to retire to start paring down our possessions, the various aspects of our lives, and in essence, our responsibilities, whether they be to our stuff, our homes, our finances or some combination thereof.

Therefore, our family took the time to downsize our lifestyle recently, and in the process, experienced what I would say was a great practice run for downsizing in or near retirement. Here’s what we did and how we succeeded in our efforts.

Positives of Retirement Downsizing Now
There can be a variety of advantages to downsizing in retirement. Having watched my mother go through this process, it opened my eyes to just how possessions can take their toll on us when having to deal with them.

My mother is sort of a pack rat. Don’t get me wrong, she’s not a hoarder or anything like that, but she is one of those people who can see a use for just about anything and everything, and therefore, she likes to hold onto stuff. However, as she nears retirement, she’s begun to downsize, making her household easier to maintain, lowering stress levels, and opening up possibilities as to what she’d like to do in retirement, where she’d like to go, and how much it will cost to get there.

Positives of Doing a Test Run Now
There are multiple benefits in our doing a downsizing test run well before we retire. First off, we know that we can do it and how to do it when the time comes. We know what sorts of items will be on the chopping block, like clothing, dishware, bulky furniture items, and heavier things like books. We also know how much time and effort it can take to downsize. Going through stuff can be draining, both physically and emotionally. It can be hard to make decisions on items that we’ve owned for years. Thankfully, my wife and I have each other, and we work as a team so that we help one another make decisions on items that otherwise we might pointlessly hold onto.

Maybe one of the most important aspects of doing a trial run downsize is that we are now well-versed in how to make money off the process.

How we Turned our Efforts into Cash
We wanted our downsizing efforts not only to make our lifestyle more efficient, but make us a little cash in the process. Therefore, we tended to look for resale options for much of the stuff that we were getting rid of.

Of course for things like books, DVDs, CDs, and video games, we found area resale shops that would pay us for such items. We did the same with some of our son’s baby toys and clothing, taking them to resale stores for lightly used child items where we made about $150 off of such items.

For the items that we didn’t have resale options for in the local market, we tended to put many of them in garage sales. This way, we made a little bit of money off our old stuff (about $600 during two garage sales), and the leftovers we made into charitable donations, taking the deduction on our income taxes in the process.

How and Where we Downsized
So exactly how and where did we downsize? Well, we hit just about every conceivable area of our home…and then, even the home itself. We started with things like clothing that had been building up over the years, going through closets and drawers, especially for our son and my wife who hadn’t gotten rid of things in a while. Then we moved on to the kitchen and all those drawers where things get hidden.

That’s the thing about downsizing for us. We realized that it wasn’t the big ticket items like couches and beds that we needed to be rid of. Rather, we had to tackle spaces like closets, drawers, cabinets, the attic, the garage, and similar spaces where things get stashed and left. Those are the spots that took us the most time and effort to sort through.

When we were finished, we had just enough stuff to fit into a 10 x 10 x 10 storage locker and the back of our SUV. Therefore, we were ready to move when our home sold, and when we relocated, we could buy a much smaller home, saving ourselves significantly not only on the home price, but on the moving process as well.

Thursday, September 27, 2012

Walking away from a Mortgage: Why is it Okay?

I was talking with my wife last night about the financial state of our great nation when I was struck by a thought.

Why is it that should a person who gets up at a restaurant and walk away from their $50 meal without paying -- even if that meal is significantly overpriced and no contract agreement was entered into regarding payment -- would likely be arrested for theft?  Meanwhile, people can walk away from a one hundred, two hundred, three hundred thousand dollar or more mortgage with little more repercussion to their financial life than damaged credit and of course loss of the home and associated equity in that home.  There's no scene made by loan officers or bank officials chasing them down in their home's driveway as they try to leave as a restaurant server might.  There's no detention or arrest made...or at least not that I've heard about.

If I tried walking out of the local convenience store with several $1 candy bars crammed in my pocket, I'd likely be arrested if caught.  Walk out on a $150,000 mortgage though, and more than likely, I'd be walking away a free man.

Now I'm not debating the rights or wrongs of walking away from a mortgage or whether the banks deserve to have these loans dumped upon them; however, I kind of find the comparison akin to getting jail time for smacking a person in the face but walking away with probation for shooting someone.

Just a few of my early morning thoughts on the matter.  Our accepted national and societal norms have been confounding me -- and frankly, concerning me -- more and more lately.  Don't even get me started on texting and driving!   

Wednesday, September 26, 2012

Income Tracking has Multiple Benefits

I’ve espoused the benefits of tracking expenses and all the ways doing so has helped me in cutting costs and getting a better handle of my personal finances. However, I’ve tended to neglect some of the benefits of income tracking. While I tend to believe that tracking expenses is by far and away the more important of the two, this doesn’t mean that tracking income doesn’t have its own benefits.

As a self-employed individual especially, I’ve certainly realized just how important tracking my income can be in helping me maintain a better overall feel for my financial situation.

Consistent and Accurate Totals
Of course one of the main benefits of tracking income is that I have consistent and accurate totals for my various income streams, which come tax time, is quite beneficial. But even before tax time rolls around, having a running total of my year-to-date income totals helps me with tax planning and setting aside properly estimated payment amounts for items like income and self-employment taxes.

Additions to Income
But I don’t just leave my tracking at “regular” sources of income that come with jobs that I conduct on a regular basis and that are employer-paid. I also factor in items outside this realm of regular income. Things like stocks, bonds, IRAs, and commodities fluctuate in value, and while maybe not currently taxable (since profits on items like my savings bonds and retirement account are deferred until converted to cash), are a part of my annual income nonetheless; and tracking them makes it easier to manage the next benefit of gauging my income -- making comparisons.

Making Comparisons
I find that making month-over-month and year-over-year comparisons of my various income streams is valuable to my personal finances for several reasons. First off, it allows me to watch and determine how various income streams are performing over time. Secondly, it helps me set goals for changing poor performing income streams, and looking for ways to push income higher.

For example, after reviewing last year’s income performance, I set a goal for this year to increase income by 20 percent over last year’s total.

Additions or Deletions
Through my comparisons and tracking over time, I’m better able to evaluate my various sources of income to determine whether there should be additions, deletions or adjustments. At the end of last year, I determined that there were several sources of income that were underperforming, and thereby not worth the amount of time I was investing in them. I therefore removed these income streams from my tracking portfolio. However, this left some gaps in my income that I could look to fill with new sources, which would also be gauged and evaluated over time

I noticed that several other income streams such as my blog and residual income from certain writing sites were lacking in progress or had even decreased over time. I therefore decided to put a little more effort toward working on these income streams in an attempt to bolster them. As I watch my efforts over time, I can come to a better conclusion as to whether my work has paid off or if these are areas that I should eliminate from my income and income tracking in order to focus my attentions elsewhere.