Fabulous Financials

I have a problem. Well, it’s not really a problem. It’s a dilemma. Wait, it IS a problem. And a dilemma. I guess it depends on how you look at it. Oh who am I kidding? Shoot, I have a twisted little situation. Ok, let me get to the point…

My tenants - the lovely people who caused my blood pressure to rise after threatening to break their lease right before Christmas. Yea, remember them? Well, we had a heart to heart and they soon realized that I’m not some airhead floozy who signs contractual agreements without reading (and understanding) the terms and conditions. Hmph! These people have no idea.

Anyhoo, I guess they resolved their private matter because at least one of them has decided to stay for the remainder of the term. Cool. What’s even better? I logged into my rental checking account today and noticed they paid rent for January and February in advance. Hmm…I have no idea why they did this and it seems a little odd, but it’s none of my business. Under normal circumstances, this would be a good thing. A great thing, in fact. But in this case, it isn’t. Well, it is, but it isn’t. Hence my dilemma.

Now that I’ve received rent payments for January and February 2008, I have to claim them as rental income on my 2007 taxes. [insert profanity here] Since I wasn’t expecting the advance payments, I didn’t plan for them. So that means I have exactly one business day (Monday, 31 December) to figure out how to offset the extra income. The most logical idea would be to make advanced mortgage payments for the interest deduction, but my online billpay service says it won’t be delivered until January 2nd. Besides, past experience has shown that my publicly traded, major corporation, mortgage company apparently is not equipped to accept or process over payments.

On the other hand, if I applied the extra cash towards anything else (let’s say my Roth for example - which I don’t know if I’m eligible to max out yet), I’d have to withdraw over $3,000 from my e-fund to cover the mortgage for two months.

Ugh!

[image credit:hffo.cuna.org]

~*~*~*~*~*~
Work to achieve, not to acquire.
And as always, BE FABULOUS!

Exactly this time last year, I received an escrow refund from my mortgage company. After estimating escrow payments (taxes and insurance) for the year, the balance reflected an “overage” so I was issued a refund check. It was approximately $500 in unexpected money, including a slight reduction in my mortgage payment. Nice!

To my delightful surprise, I received yet another refund like clockwork. This year, the check was only ~$300 but still unexpected and timely. I will use it to pay the bulk of my annual HOA dues. I forgot to consider this extra expense when establishing the rental rate for my tenants. *shrug*

I’m rounding the curb of year two and still learning the true responsibility of homeownership. Trust me people, it’s much more than just being able to afford the mortgage.

I’ve received numerous emails asking me this question, so I decided to blog about it. First I want to say, compared to many other personal finance bloggers, I’m still a baby in diapers. So what you see here is just a smidgen of the earnings potential from a successful blog.

Google Adsense: Look to the left and you’ll see an area for “Google Ads.” This is the most widely used source of online revenue and it only takes a few minutes to set up an adsense account. You design the appearance and size of the ad space, and you can also create filters to block certain ads. But…you have no control over what ads are listed because they are generated using keywords from your website. So if I blog about a poor customer service experience, you may see me type so.me.th.ing li.ke t.his because I don’t want Adsense to pick up the keywords and plaster ads for that business all over my site.

The ad value and earnings potential are based on so many variables (e.g. size of ad space, location, key words, time of day, site traffic, SEO, color of your socks, etc.), I don’t think anyone has figured out Google’s secret. Basically in this setup, Google controls the golden rod and sends you a check every month. In my case, it’s direct deposit so I can’t complain. This is a steady revenue stream.

LinkWorth: This is an affiliate program that promotes your site to potential advertisers. If an advertiser wants to purchase ad space, they have to buy it through them and the profit share is based on the type of account you set up. There’s a 70/30 split, which I have. And there’s also a 50/50 split with an incentive that they will promote your site more aggressively to a wider range of potential advertisers. Basically, they act as your pimp. LOL You establish your own rates, they find potential buyers, you agree to a profit share, and they cut you a check every month. Easy enough.

You can also sign up for link posts (and other affiliate options). This is when potential advertisers pay you to write a review about their product or service. I don’t like this side of the business as much because I don’t feel comfortable promoting a product or service that I have not tried for myself. Plus I don’t want to inundate my readers with a bunch of ‘review’ posts. So I set the price really high (triple digits) to deter most businesses and I’ve also rejected almost all of them. Since activating the service, I’ve only completed two link posts and they were for travel related sites when I was planning our vacation.

Direct Sales: Anything listed under the “Site Sponsor” heading is most likely a direct sale, which means the business did not use an affiliate program. Instead, they contacted me directly to purchase ad space on my blog. Before I knew anything about selling ad space, I used the text link calculator and link worth rank to determine the value.

As my blog matured, I started adjusting the rates. Now, I negotiate the price and terms based on several variables: type of business, ad description, location, number of text links, contract term, etc. I have established rates, but I try to be flexible enough to meet the needs of each potential sponsor. I’ve rejected a few offers, but those who are accepted become long term sponsors.

Amazon Associate: This is an affiliate program for products that are sold through Amazon. You may see them used on this blog in several ways:

1 - I use an affiliate link in the “What I’m Reading” section.

2 - I have an Amazon search box in the “What I’m Reading” section. This search box opens in another window, but it has a code embedded with my affiliate account information.

3 - I have an Amazon store that lists several (PF and non-PF) books as recommended reading.

4 - I use affiliate links when I blog about a product I’ve purchased online.

5 - I use affiliate links when I’m writing book reviews.

If you purchase (or have purchased) an Amazon item from my blog, you probably used an affiliate link. PLEASE NOTE: there is no extra charge to you and no intrusion of your privacy. I am NOT given any personal or identifiable information. When I log into my associate account, I can run a report to see what items were viewed and/or purchased through an affiliate link. For every item sold, Amazon pays a very tiny referral fee and cuts a check or gift card if the balance meets the minimum standards. This has been my least profitable revenue stream.

Book Reviews: Every now and then, a publisher will contact me to review a book. I consider this a source of revenue because I used to spend a lot of money on books, but now I don’t have to. When they ask me to write a review (my opinion is not influenced), they send a copy of the book at no charge. Sometimes, I can convince them to send an extra copy to give away. Lately, I haven’t mentioned this on the blog because I allow my Debt Payoff Incentive Crew to get first dibs. We often convene privately via email. Sorry.

Books on my nightstand waiting to be read:

Goal Digger by Alicia Dunams

Women, Emotions, and Cash by Liz Perle

Moving up to Millions by Kathleen Connell

Getting Started: Financial Guide for Younger Generation by Brian Jones

You can also check out a few book reviews I’ve completed so far. See, I’m not a procrastinator…all the time.

ING Referral Links: You may have seen my post on the $25 ING referral links. When you open a new account using an ING referral link (requires a $250 deposit), ING gives the new customer $25 and the referring customer $10. Each new customer is also given 25 referrals valued at $10 each, which equates to an additional $250 in FREE money.

When I started posting my referrals on the blog, they were gone in a few months. Now, I’ve agreed to host links for my fabulous readers as a courtesy. PLEASE NOTE: I already have a list of people whom I contact for new links, so please do not send any unsolicited links or try to advertise your links without permission. I will delete them.

PineCone Research: This isn’t really a source of blogging revenue, but it is a source of online revenue I discovered as a result of blogging. *thinking* Can’t remember who turned me on or I would give them credit. Anyhoo, PineCone sends a few surveys per month that have a payout of $5 each. Not much, but the surveys only take a few minutes to complete. The little change comes in handy too. I let the 5s build up in my PayPal account and use them when I’m in need of some online retail therapy.

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There are so many other ways to earn money while blogging, but these are the only methods I use at this time. I hope this post answered many of your steaming questions, but if I missed anything, please feel free to leave a comment. Oh and if you’re wondering - with all revenue streams combined, I earn a few hundred per month. But none of it would be possible if it weren’t for YOU…my fabulous readers.

Thank you!!

Now I need to research the tax implications of earned income from a hobby vs. business. Pbtpbtpbt @ taxes! I also need to get a better understanding of SEP-IRAs. See if I can stash the extra income under the veil of ‘retirement’ - then again, perhaps it’s just time to hire an accountant.

~*~*~*~*~*~
Work to achieve, not to acquire.
And as always, BE FABULOUS!

Are you a male who would like to earn a few extra dollars? If so, I just received an email that may be of interest to you.

Dear Panelist,

PineCone Research is ready to expand and we need your help.

We have immediate openings for MALE CONSUMERS 18 YEARS OF AGE OR OLDER.

Do you know of households that meet this description that would like to join the PineCone Research Panel? If so, please FORWARD A COPY of this e-mail to each household you would like to refer so that they may click on the registration link shown below. That household should complete the registration form themselves and submit it. REMEMBER THAT ONLY ONE PERSON PER HOUSEHOLD MAY REGISTER. Multiple registrations of the same household or individual will void all registrations.

Here is the link to the registration (email me).

If your referral has any questions, they can email us at scott@pineconeresearch.com or click on the attached links to learn more about PineCone Research.

About PineCone Research
PineCone Research Policy

As a member in good standing, you’ve already seen the benefits of being part of PineCone Research. So please, share the benefits of membership with a friend.

While this is not a paid referral program, we genuinely appreciate your help in spreading the word that PINECONE IS GROWING!

The consumer surveys take about 5-10 minutes to complete and pay out $5 each. I do them when I’m multi-tasking online and earn about $20-25/month. It’s not much but it funds my bad habits. LOL

~*~*~*~*~*~
Work to achieve, not to acquire.
And as always, BE FABULOUS!

…and I’m confused. I’m going to scrub the letter to make sure I understand everything before cashing the check, but any feedback/advice from experienced homeowners is greatly appreciated.

The letter is a review of my escrow. Apparently this is something done every 12 months. It lists my county taxes and hazard insurance for the year, then divided by 12. It shows an itemized summary of my escrow from inception, payouts, and a projection through December 2007. It has a summary of the “projected low point” and the “allowable low point.” The difference is what they call “overage,” which is the amount of the check…$510.85.

And here’s the kicker. A pleasant surprise, but I’m still shocked. Effective Dec 1st, my mortgage payment is going DOWN.

WHAT?

Umm

Ok

As you can tell, I’m new to this homeowner stuff. LOL

Comments, questions, feedback, advice…please.

~*~*~*~*~*~

Work to achieve, NOT to acquire.
And as always, BE fabulous!

~SM