We are delighted to have Greg Garrison sharing his top tips for managing money. Greg is a full-time blogger and online business owner who writes about money management, technology, and lifestyle topics.
Running a blog for a living has its benefits – you can set your own hours, take breaks when you want, and even do work at 3am. On the other hand, unless your blog is one of the top blogs in your niche, your income is probably inconsistent, and poor money management could land you back in the traditional workforce in short order. Since no one wants that to happen, it’s particularly important to pay close attention to your finances. Here are some tips to keep you on track.
1. Make a Conservative Budget
Since your monthly income is likely to fluctuate based on advertising and affiliate sales, it’s important to create a very conservative budget. Take a look at your income from the last six months, and create a budget by using your average monthly income or your lowest monthly income from that period. Once you’ve determined your baseline income amount, outline your necessary expenses, then compare them to your actual expenses. If you need to pare back actual expenses to fall within your expected income, do it. And don’t forget to include monthly prorated amounts for quarterly estimated tax payments as well.
2. Cut Monthly Expenses
After you set your budget, take a good hard look at all your monthly expenses. Check for deals or ways to save on ongoing bills, such as Internet and cell phone service, or car insurance. Even if you cut your Internet costs by only $10 a month, that’s an extra $120 per year. Check the competition for a better cell phone data plan and cable TV package, and contact your energy providers to see if they offer in-home audits. If so, schedule one to learn how you can save even more on monthly energy expenses.
3. Review Your Personal Spending
The real budget busters are frequently tied to discretionary spending. Unless you have a healthy savings account (at least six months expenses saved up), resist the urge to run out and purchase the latest iPhone, or that 60-inch flat screen TV you’ve been coveting. If there’s a big purchase you want to make, work it into your budget and save up for it before you buy.
It’s not just the big purchases that can break the bank, though. Take a look at your impulse purchases from the convenience store, how frequently you stop for coffee, or how often you meet friends for drinks. Are all those expenses really necessary? Give yourself a monthly budget for each category, and only use cash to pay for these expenses. When the cash is gone, your monthly spending in that category is done.
4. Maintain Balance During Good Months
If you’re coming off a great month, there’s nothing wrong with celebrating, just don’t overdo it. Not every month will feel as flush, so go ahead and put some of that surplus into a savings account to help keep you afloat during down times.
5. Save Whenever You Can
Any time you have an opportunity to save money, do it. If you get a rebate check in the mail or a Christmas check from your parents, put it away. But don’t just rely on “free” money to build up your savings – plan for it. Work savings into your monthly budget so you can slowly build up your retirement or rainy day fund. This also comes in handy for unexpected business expenses, such as a replacement computer if your current one crashes.
6. Generate Cash and Save Money In Your Spare Time
Since you’re likely on the Internet all day long, use a bit of your spare time to generate additional cash or search for savings. Complete paid online surveys for a couple bucks, or check out deal-sharing or couponing websites like FatWallet and The Krazy Coupon Lady. Just keep your spending in check – use coupons and deal sites for necessary purchases, not un-budgetted discretionary items.
Money management isn’t just about monitoring your current budget. The truth is, the more money your blog makes, the better off you’ll be, so also take steps to increase your blog’s traffic. One great way to do this is through guest posting. Reach out to other bloggers in your niche, and even a few related niches, and initiate relationships. When you have the opportunity to work with another blogger, submit high-quality, well-written content. The more inbound links you generate, the higher you’ll rank on Google search results, ultimately driving more traffic to your blog and increasing revenues.
What budgeting and money management advice do you have for bloggers?