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The no-pants guide to spending, saving, and thriving in the real world.

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Don’t Screw Future-You

Finance, Life

A conversation between me and my temporally displaced self.
Future Me: Excuse me, Jason?
Me: Yes?
FMe: <Slap!>
Me: May I ask what that was for?
FMe: Of course.
Me: What was that for, jerk?
FMe: That was payback for all of the hell you have put me through.
Me: What?!?  I’ve never even met you, before.
FMe: Of course you have.  I am future-you, and I’m sick of getting screwed by past-me, that is, you.
Me: Huh?
FMe: Listen close.  You’re not  the sharpest brick in the box and I don’t want to explain this twice.
Me: ???
FMe: A long time ago, when you first met our wife, you were dumb.
Me: I don’t appreciate….
FMe: Shut up.  I was dumb then, too.  Remember?  You…err…we bought a new truck, built an addition on our…err…your…err…whomever’s house, got married in the same year.  On top of many other expensive decisions.  Do your recall?
Me: Yes, I do.  So what?
FMe: If that wasn’t enough, you and your smoking-hot bride are still shopping like you’re rich. You drive a new car.  Your kids wear new clothes.  You’ve got a house full of new furniture.  How did you pay for all of that?
Me: Naturally, I charged it.  Zero payments, zero interest for a year!  Pretty smart, huh?
FMe: What happens in a year?
Me: I don’t know.  I’ve got a full year to figure that out.
FMe: <Slap!>  I’ll tell you what happens!  Future-you, that’s me, gets screwed!   Your raise didn’t come through.  You had a baby. The truck broke down.  Your wife took maternity leave.  A roommate moved out.  You took a loss in the stock market.  You didn’t plan!  You had no savings to cover any of those problems because you were too busy servicing debt to pay for your current life.
Me: How was I to know?
FMe: <Slap!>  Life happens!  You never know what is coming next.  You need to plan and save for what might happen.  Otherwise, you’ll just accumulate more debt to be serviced by yours-truly.  That is not acceptable.
Me:  So?  What are you going to do about it?
FMe: <Slap!>
Me: Really?  Again?
FMe: <Slap!>  I’m struggling to pay your debt. Your son starts college next year, but you’ve left me completely unable to help.  Your daughter wants to get married in a couple of years, but the Father-of-the-Bride can’t afford a tux.  My wife, your beatiful bride, wants a vacation that I can’t afford.   You’ve screwed me, dude.
Me: I’m sorry.  What can I do to fix it?
FMe: Buy me dinner, first.
Me: Huh?!?!?
FMe: Stop the excess spending. Spend less than you make, for a change.  No credit.
Me: None?
FMe: None.  Nada.  Zip.  Zilch.  Only spend what you can afford. Budget.  Pay off those nasty bills.  Don’t leave me hanging.
Me: So, what you’re saying is that, if I don’t have the money, I shouldn’t buy it?
FMe: Exactly.  That’s the path to wealth, freedom, and financial independence.  Live in the real world.
Me: Gee, thanks, Future-Me!  Now I know.
FMe: And knowing is half the battle.

What would your future-you have to say to you?

 

Sunday Roundup – Nook Failure

Misc

The manga section at Barnes & Noble at The Sho...
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This week, I spent more than 2 hours, 20 emails, and 30 miles trying to convince UPS and Barnes & Noble to get me a Nook that I paid for 3 weeks ago.   Hopefully, I’ll have it early this week.  If not, I’m giving up.  The only other action I’m willing to take to get this resolved is to call my credit card company and file a chargeback.

Fun!

Weight Loss Update

I am on the Slow Carb Diet.   At the end of the month, I’ll see what the results were and decide if it’s worth continuing.   For those who don’t know, the Slow Carb Diet involves cutting out potatoes, rice, flour, sugar, and dairy in all their forms.   My meals consist of 40% proteins, 30% vegetables, and 30% legumes(beans or lentils).    There is no calorie counting, just some specific rules, accompanied by a timed supplement regimen and some timed exercises to manipulate my metabolism.   The supplements are NOT effedrin-based diet pills, or, in fact, uppers of any kind.  There is also a weekly cheat day, to cut the impulse to cheat and to avoid letting my body go into famine mode.

I’m measuring two metrics, my weight and the total inches of my waist , hips, biceps, and thighs.   Between the two, I should have an accurate assessment of my progress.

Weight: I have lost 41 pounds since January 2nd.   That’s no progress since last week.   I’m still doing push-ups every day, so it’s not surprising that I’m flunking weight loss.

Total Inches: I have lost  22.5 inches in the same time frame, up half an inch since last week.

Best Posts

Five Cent Nickel had a post on tipping.  I always tip, but I don’t consider 15% to be a requirement.  If the service sucks, I tip just a few cents.  If the service is great, I easily and always clear 20%.  A friend tried telling me that servers expect 20% to be standard, but that’s nuts.  They aren’t the people who get to make that decision.

Money Crashers talked about traveling for free.  In anticipation of the Financial Blogger Conference in October, I opened a travel rewards card.  I’m hoping to make the trip for free.

I watched a TedTalk yesterday about teaching kids about electricity with homemade play-dough.   This is a project that will be happening.

Carnivals I’ve Rocked and Guest Posts I’ve Rolled

Narrow Bridge Finance ran my post, Monsters, while I ran his, Living the High Life, for the Yakezie blog swap, answering the question “What motivates you financially?”

Negotiating Superstar was included in the Carnival of Personal Finance.

5 Ways to Change Your Spending Habits was included in the Totally Money Blog Carnival.

Thank you! If I missed anyone, please let me know.

Get More Out of Live Real, Now

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You can subscribe by RSS and get the posts in your favorite news reader.  I prefer Google Reader.

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You can ‘Like’ LRN on Facebook.   Facebook gets more use than Google.  It can’t hurt to see what you want where you want.

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You can send me an email, telling me what you liked, what you didn’t like, or what you’d like to see more(or less) of.   I promise to reply to any email that isn’t purely spam.

Have a great week!

 

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Money Problems – Day 2: What’s Going Out?

Finance

Today, I continuing the  series, Money Problems: 30 Days to Perfect Finances.   The series will consist of 30 things you can do in one setting to perfect your finances.  It’s not a system to magically make your debt disappear.  Instead, it is a path to understanding where you are, where you want to be, and–most importantly–how to bridge the gap.

I’m not running the series in 30 consecutive days.  That’s not my schedule.  Also, I think that talking about the same thing for 30 days straight will bore both of us.   Instead, it will run roughly once a week.  To make sure you don’t miss a post, please take a moment to subscribe, either by email or rss.

On this, day 2 of the series, you need to gather all of your bills: your electric bill, your mortgage, the rent for your storage unit, everything.  Don’t miss any.

Go ahead, grab them now.  I’ll wait.

Did you remember that thing that comes in the plain brown wrapper every month?  You know, that thing you always hope your neighbors won’t notice?

Now, you’re going to sort all of the bills into 5 piles.

Pile #1: These are your monthly bills.  This will probably be your biggest pile, since most bills are organized to get paid monthly.  this will include your credit cards, mortgage(do you rent or buy?), most utilities and your cellphone.

Pile #2: Weekly expenses.  When I look at my actual weekly bills, it’s a small stack.  Just daycare.  However, there are a lot of other expenses to consider.  This stack should include your grocery bill, gas for your car, and anything else you spend money on each week.

Pile #3:  Quarterly and semiannual bills.  I’ve combined these because there generally aren’t enough bills to warrant two piles.  My only semi-annual bill is my property tax payment.  Quarterly bills could include water & sewer, maybe a life insurance policy and some memberships.

Pile #4:  Annual bills.  This probably won’t be a large pile.  It will usually include just some memberships and subscriptions.

Pile #5:  Irregular bills.   The are some things that just don’t come due regularly.  In our house, school lunches and car repairs fall into this category.   We don’t have car problems often, but we set money aside each month so our budget doesn’t get flushed down the drain if something does come up.

Now that you have all of your expenses together, you know what your are on the hook for.  Next time, we’ll address income.

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Make Extra Money Part 2: Niche Selection

Business, Finance

If you want to make money, help someone get healthy, wealthy or laid.

This section was quick.

Seriously, those three topics have been making people rich since the invention of rich.   Knowing that isn’t enough. If you want to make some money in the health niche, are you going to help people lose weight, add muscle, relieve stress, or reduce the symptoms of some unpleasant medical condition?   Those are called “sub-niches”.  (Side question: Viagra is a sub-niche of which topic?)

Still not enough.

If you’re going to offer a product to help lose weight, does it revolve around diet, exercise, or both?   For medical conditions, is it a way to soothe eczema, instructions for a diabetic diet, a cure for boils, or help with acne?  Those are micro-niches.

That’s where you want to be.  The “make money” niche is far too broad for anyone to effectively compete.  The “make money online” sub-niche is still crazy.  When you get to the “make money buying and selling websites” micro-niche, you’re in a territory that leaves room for competition, without costing thousands of dollars to get involved.

Remember that:  The more narrowly you define your niche market, the easier it is to compete. You can take that too far.  The “lose weight by eating nothing but onions, alfalfa, and imitation caramel sauce” micro-niche is probably too narrowly defined to have a market worth pursuing.  You need a micro-niche with buyers, preferably a lot of them.

Now the hard part.

How do you find a niche with a lot of potential customers?  Big companies pay millions of dollars every year to do that kind of market research.

Naturally, I recommend you spend millions of dollars on market research.

No?

Here’s the part where I make this entire series worth every penny you’ve paid.  Times 10.

Steal the research.

My favorite source of niche market research to steal is http://www.dummies.com/.    Click the link and notice all of the wonderful niches at the top of the page.  Jon Wiley & Sons, Inc. spends millions of dollars to know what topics will be good sellers.  They’ve been doing this a long time. Trust their work.

Niche Research
Click for full-size image

You don’t have to concentrate on the topics I’ve helpfully highlighted, but they will make it easier for you.  Other niches can be profitable, too.

Golf is a great example.  Golfers spend money to play the game.  You don’t become a golfer without having some discretionary money to spend on it.   I’d recommend against consumer electronics.  There is a lot of competition for anything popular, and most of that is available for free.   If you choose to promote some high-end gear using your Amazon affiliate link, you’re still only looking at a 3% commission.

I like to stick to topics that people “need” an answer for, and can find that answer in ebook form, since I will be promoting a specific product.

With that in mind, pick a topic, then click one of the links to the actual titles for sale.   The “best selling titles” links are a gold mine. You can jump straight to the dummies store, if you’d like.

Of the topics above, here’s how I would narrow it down:

1.  Business and Careers. The bestsellers here are Quickbooks and home buying.  I’m not interested in either topic, so I’ll go into “More titles”.   Here, the “urgent” niches look like job hunting and dealing with horrible coworkers.  I’m also going to throw “writing copy” into the list because it’s something I have a hard time with.

Bestsellers
Bestsellers

2.  Health and Fitness. My first thought was to do a site on diabetic cooking, but the cooking niche is too competitive.  Childhood obesity, detox diets and back pain remedies strike me as worth pursuing.  I’m leaning towards back pain, because I have a bad back.  When you’ve thrown your back out, you’ve got nothing to do but lie on the couch and look for ways to make the pain stop.  That’s urgency.

3.  Personal Finance. The topics that look like good bets are foreclosures and bankruptcies.    These are topics that can cost thousands of dollars if you get them wrong.  I hate to promote a bankruptcy, but some people are out of choices.    Foreclosure defense seems like a good choice.   Losing your home comes with a sense of urgency, and helping people stay in their home makes me feel good.

4.  Relationships and Family. Of these topics, divorce is probably a good seller.  Dating advice definitely is.   I’m not going to detail either one of those niches here.  Divorce is depressing and sex, while fun, isn’t a topic I’m going to get into here.   I try to be family friendly, most of the time.    Weddings are great topic.  Brides are planning to spend money and there’s no shortage of resources to promote.

So, the niches I’ve chosen are:

  • Back pain
  • Bankruptcy
  • Conflict resolution at work
  • Detox diets
  • Fat kids
  • Foreclosure avoidance
  • Job hunting
  • Weddings
  • Writing copy

I won’t be building 9 niche sites in this series.    From here, I’m going to explore effective keywords/search terms and good products to support.  There’s no guarantee I’ll find a good product with an affiliate program for a niche I’ve chosen that has keywords that are both highly searched and low competition, so I’m giving myself alternatives.

For those of you following along at home, take some time to find 5-10 niches you’d be willing to promote.

The important things to consider are:

1. Does it make me feel dirty to promote it?

2. Will there be customers willing to spend money on it?

3.  Will those customers have an urgent need to solve a problem?

I’ve built sites that ignore #3, and they don’t perform nearly as well as those that consider it.  When I do niche sites, I promote a specific product.  It’s pure affiliate marketing, so customers willing to spend money are necessarily my target audience.

Money Problems – Day 6: Reducing Expenses

Finance

Lincoln memorial cent, with the S mintmark of ...
Image via Wikipedia

Today, I am continuing the  series, Money Problems: 30 Days to Perfect Finances.   The series will consist of 30 things you can do in one setting to perfect your finances.  It’s not a system to magically make your debt disappear.  Instead, it is a path to understanding where you are, where you want to be, and–most importantly–how to bridge the gap.

I’m not running the series in 30 consecutive days.  That’s not my schedule.  Also, I think that talking about the same thing for 30 days straight will bore both of us.   Instead, it will run roughly once a week.  To make sure you don’t miss a post, please take a moment to subscribe, either by email or rss.

On this, Day 6, we’re going to talk about cutting your expenses.

Once you free up some income, you’ll get a lot of leeway in how you’re able to spend your money, but also important–possibly more important–is to cut out the crap you just don’t need.  Eliminate the expenses that aren’t providing any value in your life.  What you need to do is take a look at every individual piece of your budget, every line item, every expense you have and see what you can cut.  Some of it,  you really don’t need. Do you need a paid subscription to AmishDatingConnect.com?

If you need to keep an expense, you can just try to lower it.  For example, cable companies regularly have promotions for new customers that will lower the cost  to $19 a month for high-speed internet.  Now, if you call up the cable company and ask for the retention department, tell them you are going to switch to a dish.  Ask, “What are you willing to do to keep my business?”  There is an incredibly good chance that they will offer you the same deal–$20 a month–for the next three or four months.  Poof, you save money.  You can call every bill you’ve got to ask them how you can save money.

I called my electric company and my gas company to get on their budget plans.  This doesn’t actually save me money but it does provide me with a consistent budget all year long, so instead of getting a $300 gas bill in the depths of January’s hellish cold,  I pay $60 a month.  It is averaged out over the course of the year. It feels like less and it lets me get a stable budget. Other bills are similar.  You can call your credit card companies and tell them everything you take your business to another card that gave you an offer of 5% under what ever you are currently paying. It doesn’t even have to be a real offer.  Just call them up and say you are going to transfer your balance away unless they can meet or beat the new interest rate.  If  you’ve been making on-time payments for any length of time–even six months or a year–they’re going to lower the interest rate business, no problem.  Start out by asking for at least a 5% drop.  In fact, demand no more than 9.9%.

Once you’ve gone through every single one of your bills, you’ll be surprised by how much money you’re no longer paying, whether it’s because somebody lowered the bill for you or you scratched it off the list completely.

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