Hello, dear reader!
I spent a lot of time traveling the first few months of 2017 and now that I’m back home for a while, I’ve been thinking about how to improve my finances (because they’ve been a bit of a mess while I was traveling) while also providing value to you.
And, so, I’ve decided two things. First, I’m going to go back to my roots on this blog and use it as a way to hold myself accountable financially. After all, that’s what started this whole blogging thing for me almost seven years ago. Time flies.
Second, I’m taking a page out of many of my friends’ and colleagues’ books and am going to start publicly tracking my net worth.
I’ve been following net worth reports like those from Budgets Are Sexy of Cashville Skyline for quite some time, and after stumbling upon Millennial Money and his incredible story of becoming a millionaire, I realized that I want to get into that club someday. The only way I’m going to do that, is by tracking what’s going on.
Additionally, I hope readers find it helpful and encouraging as they get their finances in order as well. The business and finance industry reeks of a lack of transparency, so my hope is that by putting my numbers out there that I can show you how this actually works.
Why track your net worth and not your income?
I’ve done income reports in the past, and of course, I’m going to keep an eye on it as I do net worth reports from now on. But the reason I’m shifting gears is because your net worth is more important than how much money you earn.
Don’t get me wrong, earning more will certainly help me increase my net worth, but you could be earning six figures and still have a net worth of $0 – a.k.a you’re still broke.
Your net worth is how much you actually have to your name. In other words, it’s your assets (cash, investments, properties, businesses, etc.) minus your liabilities (debt).
A positive net worth means you have more assets (read: money) than liabilities (read: debt).
In order to get to that million dollar club, I’ll need to increase my net worth over time by earning more, saving more and investing more.
April 2017 Net Worth: $21,563
Since this is the first net worth report, I’ll be starting with a net worth of $21,563.
I want to address the fact that I started with absolutely $0 in 2010. That $21.5k has come from a few years of saving, investing, hustling, starting a business and some trial and error.
When I first started saving for retirement, I wasn’t earning very much money. I was unemployed for several months after graduating from college, spent the next few years earning a maximum of $22,000 a year and then decided to fuck all of that and pursue my own business.
I’ve also never had access to an employer-sponsored retirement plan. Not even once. I’ve since learned this isn’t uncommon among Latinos as 70 percent of us don’t have access to any sort of retirement plan through an employer.
I’m not saying this to brag, I’m saying this to show that even despite shitty circumstances and low wages, that you can still save money and increase your net worth. Is it more difficult? Yes. Is it impossible? No.
The only part where I did get lucky is that I graduated from college debt free. I made a choice to go to a school that was not my first choice (or my any choice, really) so that I wouldn’t have to take out student loans.
(Note: Student loans aren’t the worst thing – credit card debt is far worse – and they don’t have to stop you from increasing your net worth. Click here to learn more about refinancing your student loans.)
I also have a super supportive family that let me move back home all those years ago and let me stay there when I wasn’t earning very much and then decided to quit and pursue this digital marketing/blogging world.
Now that I earn more, I chip in financially but choose to stay to keep my personal expenses as low as possible so I can continue saving and investing.
In that sense, I’m super lucky because my family is on board with my financial goals. They aren’t rich or anything, but I’ve come to realize they are more financially literate than most people. As such, we’re all on the same page when it comes to financial goals and they are very supportive of mine.
So yeah, I consider myself to have won the genetic lottery. I know this isn’t the case for everyone and I’m well aware that I’m lucky.
I guess I’m trying to make two points here:
Point #1: Even difficult circumstances don’t necessarily have to keep you from increasing your net worth. I’ve never been handed a check worth thousands of dollars, no one has ever given me money for my business, I never had access to an employer-sponsored retirement plan and I wasn’t even earning a living wage for much of my 20s – yet I still managed to save and invest.
(Note: If you did have money given to you, more access to investment vehicles, or earned more money, please don’t feel guilty. You really shouldn’t. I don’t hate on you for it and I don’t believe other people have a right to hate on you either.)
Point #2: I’ve made conscious choices that allowed me to take on less debt, keep my expenses low and take on more risk. While I’m not saying go crash with your folks (especially if you have a bad relationship with them in which case please don’t) or go to a school you hate, I am telling you you’re going to have to make some choices to get to where you want to go.
As my financial blogging girl crush, Paula Pant says “You can have anything, but you can’t have everything.”
How I Earn Money
In case you’re just stumbling upon me or my work, I figured it was important that you know how I actually earn my money.
- Freelance writing and content marketing. I write personal finance and business content for the likes of Discover, PNC, Santander and Wells Fargo. I also write content for FinTech companies and I have columns at places like Inc. It didn’t start off this way – in fact, I only made $5 my first month as a freelance writer – but I’ve made major progress in growing my content marketing business over the years. Last year I brought in 3x as much as I did at my last job in gross revenue. (P.S. There is still a major need for freelance writers and content marketers in the digital age. If you’d like to create your own mid-five figure writing business, check out my digital course Make Money Your Honey With Freelance Writing.
- This blog makes me money. This blog earns me money in the form of ad revenue, sponsored content, digital course sales and affiliate sales. I earned enough in affiliate sales last year to help me max out my retirement account This is all thanks to a course I took called Making Sense of Affiliate Marketing by Michelle Schroeder-Gardner.
- Business coaching and content marketing consulting. I work with private coaching clients to help them create their own online businesses. I’ve also recently started working with financial companies as a consultant to help them with their content marketing strategy. If you’re interested in business coaching or consulting, click here to set up a consultation call.
- Dues from my membership site. For individuals who aren’t ready for private coaching, I have an option that gives them access to all the business classes I’ve created and a monthly group coaching call with me. I call it the Make Money Your Honey Academy and it allows me to help more people while also giving me recurring passive income. Click here to learn more about the Academy.
- Book sales. I make money passively every month in the form of book sales. People purchase my Amazon best-selling book Make Money Your Honey and the accompanying workbook without me having to do very much. It’s been three years since I self-published this book and it still makes me money.
There are a couple of things I’d like to point out here since we’re talking income.
The reason I decided to screw a regular job a few years ago and pursue my own business and brand is that data shows that most millionaires are entrepreneurs. There’s no cap on how much I can earn if I run my own business.
Second, you’ll notice I have money coming from different places. This is also done on purpose. The average millionaire in the U.S. has seven streams of income.
The really crazy part (at least to me) is that all of this started with a blog a few years ago.
All I did was make the decision to teach myself personal finance and do it publicly through a blog. Fast forward a few years and one blog launched my entire career.
Tools I Use to Help With My Finances and Net Worth
Personal Capital – I’ve been using Personal Capital for over a year now to help me track my net worth. It’s 100% free and it gives you a crystal clear picture of your assets and liabilities. It also helps you track your income and your spending.
Betterment – I invest into a Roth IRA, a non-retirement investment account, and as of recently, an SEP IRA through Betterment. I’m pretty hands off when it comes to investing and for now I mostly just stick to ETFs. The fees are also unbeatable for someone who is just getting started. Click here to learn more about Betterment and how you can get one month of free service.
Acorns – Acorns is an investment app that rounds up your spare change and invests it into ETFs. At one point I had over $1,000 in spare change being invested in the market. I’ve since moved to another similar app but I still recommend it.
Dvdendo – Dvdendo is similar to Acorns with one key difference – they are trying to help the Latino community by means of financial education. Since I believe it’s important to invest in my own community (and since I’ve worked with these guys very closely so I have an insider’s perspective I don’t get with other apps), I decided to switch from Acorns to Dvdendo for now. Maybe at one point, I’ll use both for an extra push.
Qapital – Qapital is my replacement for Digit. When Digit announced their monthly fee of $2.99 it was no longer worth it to me, so I started looking for alternatives. With Qapital I am doing the 52 Week Savings Challenge automatically. That means I’ll have $1,378 saved automatically this year. I also have a rule set up where I’m saving every time I exercise for 30 minutes. The app hooks up to Apple Health and takes it’s cue from there. Oh, and it’s 100% free. Click here to open an account with Qapital and we each get $5.
Capital One 360 – I’ve had an account with Capital One 360 since back in the day when it was still ING Direct. The reason I moved to an online bank many years ago was that my account at a big bank was being eaten up by stupid fees. With Capital One 360 I get free checking and savings with no account minimums.
How I Plan to Improve
Okay, so I’m a little late in getting April’s net worth report to you seeing as how it’s almost the end of May. So one place to improve is certainly in getting these out earlier in the month. That shouldn’t be a problem thanks to Personal Capital.
Here’s how else I plan to improve:
- Going back to budgeting based on percentages. At this point, I’ve tried just about every budgeting method there is. I’ve noticed that for my personality type and for dealing with variable income, budgeting based on percentages is the best way to go. For example, I have to save 30 percent of everything for taxes anyway, so I’ll budget everything else according to percentages as well. I hope to start with 10 percent going to long-term investments. I cover this strategy more in depth in my book.
- Cut spending. I went a little crazy when I started earning more money last year. Lifestyle inflation certainly creeped in the moment I realized I was no longer totally broke and had more choices. Well, I’m now over it so it’s time to reel her back in again. I’ve already started by canceling some subscriptions I wasn’t using and adding the monthly amount to my automatic savings.
- Earn more money. Because when is that not ever a goal? I’m hoping that by tracking my net worth I’ll have a better understanding of what I have to do to earn more.
And there you have it, my first ever net worth report. From this point forward I’ll be sharing the changes in my net worth and the lessons learned along the way.
If you’d like to get email updates on when I publish my net worth reports, make sure to sign up for the email list using the box below. You’ll receive a free 5-day money course to help you get started in improving your own financial journey.