Frugaling

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What’s Motivating Me To Save?

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Hamster Wheel
Photo: Dan Derrett/Flickr

Most days I live a chaste life. If they created a reality TV show of my life, it would be cancelled before the air date. Hell, the film crew would probably fall asleep in production. It’s a simple, hamster wheel existence that consists of getting up, making breakfast, reading for hours, working, and repeating that all the next day. The bummer is I want more than this.

Over the last few weeks of summer, as I’ve been on my constant rinse and repeat cycle, a growing desire to travel has crept up. More than travel, it’s a desire for more adventure. But then there’s my life and reality.

Being a 25-year-old doctoral student is a lesson in delayed gratification — working hard now to find enjoyable work and a reasonable paycheck later in life. Like many times before, on this frugal journey, I look at my budget. The numbers don’t add up. I can’t spend the money to travel to England, France, or visit Montreal. I just don’t have it, as I would need to take out student loans again to support the travel. That’s unacceptable to me. The psychological burden of student loans was too great and the interest rate of 6.8% is punitive.

I’m struggling to see the path and reason for my frugality. It’s here that I introspect, “What’s motivating me to save money and avoid more student loans?” There are both great opportunities and real challenges that create this defensive personal finance stance.

One of the biggest motivators is fear. Constant rises in income inequality, climate change, and a political environment that is skewed to the wealthiest are frightening me. If you’re not part of the bourgeois, you’ll likely be fighting, clawing, and begging your way out of lower income categories over the next few decades. Knowing that the foreseeable future will likely include environmental refugees (e.g., economists and researchers have increasingly theorized that the Syrian civil war was motivated by drought and the Pentagon has suggested that climate change may be a global threat) and massive changes in employment possibilities (I have no idea where or when I’ll be hired when I finally graduate), I’m eager to sock away some cash. Accurate or not, these are the challenges that drive me to save.

On the flip side, I’m motivated to save for a number of fun, experiential opportunities. I want to travel the world, develop a fluency in a foreign language (if I still have the brain power at that point in my life), give to the scholarship I started at Colorado State University, and develop a thriving practice as a counseling psychologist. These will all require a steady and safe savings. More importantly, they’re all worth the delayed gratification and relative banality of my life right now for more later on.

It’s with this yin-yang relationship — balanced — that I’m forgoing the travel now to live a better life later on. Until then, I’m diving into a good book and pretending to travel to faraway places and positions — loving every minute of the dream and working my butt off to make that happen.

How To Fundraise $25000 In 12 Months

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Sam Lustgarten Always Remember Speech

In search of hope amidst great pain

To save money on housing and food, I decided to become a resident assistant as an undergraduate student. That decision put me on a collision course with residents dealing with serious mental health concerns. The transition to college was always different — some people eased right into it and others struggled.

I loved my residents, and thought we had an incredible academic year. It was April when everything changed. A resident died by suicide. As one of the first responders to the scene, the visuals caused an aching, grinding weight over my chest. Over the course of the next six months, two more people in my life would die by suicide.

It shattered me. There were many days in which getting up was a trial. I’d leave classes early to go into a bathroom and cry. I remember feeling lonely and isolated in my pain. It took that heartache and tragedy to find hope for something better.

Always Remember Fundraise Plan
Part of my proposal to administrators.

Finding, honing an inspiration

I was desperate for action. Then, a flash of energy hit me in one sleepless night nearly a year after the first suicide. I wanted to start a scholarship to fund undergraduate students who wanted to pursue suicide prevention and/or work with those suffering from severe mental health concerns.

Over the course of the next month, I created a proposal for the university and told them how I would fund an endowment (a self-supporting — through interest — scholarship). I explained that I had been talking to friends and family. Altogether, we could scrounge up about $2,000 to start.

They told me I could try, but I’d need to fundraise $25,000 within 5 years.

I said, “Deal.”

Make the first donation

When I started the scholarship I had about $500 in my bank account. I had few assets. Still, I sold everything I could and donated a couple hundred dollars to start the scholarship. It was less than 1% of what I’d need to raise, and it hurt to give that much (especially since I’d need to take out student loans soon after that). No financial advisor would say it was wise.

I had to give everything I could. My head and heart were sucked into this powerful idea — hope through tragedy. I don’t regret giving as much as I did then or over the years. It fueled my passion to seek donors and encourage others to join me.

Realize your connection to community

With almost every cause, there’s a community of support behind it. I realized I wasn’t alone in my distress and desire to make an impact. In fact, the community around my alma mater was incredibly supportive. They were eager to make a difference, as well. They had been affected by this issue.

I heard stories about lost loved ones — brothers, sisters, fathers, mothers, children. It hurt to hear the stories, but I only grew more connected to those around me. Eventually, students at a local high school started fundraising for the scholarship. It brings tears to just think about how meaningful that felt. A cynical part of me died when others began to donate. I didn’t know if anyone would support the cause.

Inspire yourself and others

Suicide Prevention Fundraiser
Group of supporters spent a day in the plaza providing information about the scholarship and suicide prevention.

The $2,000 wasn’t enough, and I felt a pressure to make this happen. I told everyone about the scholarship. Donations began to trickle into the scholarship account.

I shared on Facebook and Twitter — all over social media. Each time led to others sharing. The positive feedback was unmatched in my life. It felt amazing to be channeling such a dark period in my life.

Others were inspiring, pushing me to continue. Likewise, I seemed to inspire others. This shared, symbiotic relationship appeared to benefit everyone. My energy, which had long been depressed and negative, shifted.

That first summer, a massive, $5,000 donation was made. The idea of a scholarship to prevent suicide and provide awareness to this issue struck a chord with many who were affected in the community.

Throw away modesty, seek media attention

This is the trickiest part for some people. Seeking attention is something that society generally says is inappropriate. Unfortunately, far too many people think media will just come to you when they’re ready. I threw that lesson away as fast as I could.

Seek out media outlets! Talk to local papers, zines, and websites about your story and propose times for interviews. This has a tremendous snowball effect to getting donations and finding supporters. Media can be your best friend. You never know, you might just get the biggest paper in your state covering the scholarship and linking to it.

Endowed status!

After about 12 months — the fastest a scholarship has ever been fully endowed in the college — over $25,000 was raised. Whatever you’re looking to fundraise for, know that you can. Follow your passion, link others, connect with a community, give until it hurts, and seek some old fashioned media attention. You can do this.

If you would like to donate to the Always Remember Never Surrender suicide prevention scholarship I founded, head on over to: https://advancing.colostate.edu/arns

How Much Can Bloggers Make?

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How Much Can Bloggers Make? Do you want to be a blogger too and earn money? Find out on this post how much can bloggers can make! #Blog #blogging #makemoney

To publish or not to publish, that is the question

I debated whether I should publish this article for two months. I talked to friends, family, acquaintances — all have given me different responses. I tweeted to fellow personal finance bloggers, too. Everyone had a different answer.

Frankly, I’m nervous to share this article. Unlike my weaker points and budgetary failures, this article is a highlight. It was easier for me to write and confess my student loan debt to you all, but successes are more difficult to share — ironically.

After much consternation, I decided I’d finally publish an answer to a big question I’ve been getting: “How much can bloggers make?” Or, more specifically sometimes: “How much did you make, Sam?”

Even as I type these words, I’m debating whether I’ll push the publish button. It’s really challenging to share this number. I’m proud and embarrassed in a weird way.

Well, here goes nothing! Today, I’m going to share with you how much I made over the first year of Frugaling, and what led to that success. My goal is to both inspire those who are thinking about starting a blog, but also to provide info about where the greatest revenue can be made. I know of quite a few people right now who want to get paid to write or need some push to start blogging.

This one’s for you.

A trickle became a torrent of funds

I started with Google AdSense

I began Frugaling on May 4, 2013. Motivated out of a desperate need to share my story with others and begin my journey back to zero debt, I wrote my first article. These first few months I only had Google AdSense. I stared at $15-20 a month and thought this was pointless, but that quickly doubled, and doubled again.

For those who’ve never heard of the platform, it’s an easy and very popular way to start making revenue. Google handles the advertisers — all you do is publish them. Easy as can be. Nobody becomes rich from AdSense, though (hardly anyone at least). It’s an entirely automated and algorithmic ad network that pairs relevant advertisements with consumers. While creepy sometimes, the ad network is the best in the industry — for everyone involved in the money making process.

I looked up affiliate opportunities

As a member of the personal finance blogging community, I was fortunate to be exposed to various money-making experts. Many had done well adding affiliate programs to their sites. Affiliate programs usually host a bunch of companies that are looking to give publishers a small commission for products sold. Let’s say you run an apparel website and link to Macy’s, you can count on a certain amount of revenue kicked back to you in the referral process. Or, if you blog, it can help to advertise your web host.

I decided to throw my hat in the ring and joined a top-notch network called LinkOffers. Two months after being approved to hawk some bank-affiliated products, I looked at my account and noticed a strange number: $500 in sales. It was early in the summer and the number shocked me. I was making ridiculous amounts of money! Over the ensuing months, I received an atmospheric amount of affiliate commissions (I’ll address monetary specifics in the proceeding section).

I partnered and linked to Amazon.com

I timed articles to important holidays, your recommended books, and/or tax season. Most bloggers seem to struggle to make much money with Amazon’s affiliate program. I found it to be incredible.

You can link to nearly everything in the Amazon store and make a commission on that item and anything else that’s purchased during that visit. This primary and secondary commission style is very generous. For instance, if someone buys the product you advertised and a new Macbook Air, get ready for a kickback of $40 or more. These purchases added up quickly. One article netted me over $200 in two months.

Flappy Bird-style wealth creation is definitely scary

Flappy Bird Money Wealth Success
Flappy Bird was a hugely popular, viral success. The creator was making $50,000 per day when he pulled it from the Apple App Store.

The Apple Store was slammed earlier this year with millions of downloads of one app with a ridiculously simple premise and name: Flappy Bird. The creator was a mysterious and private individual based in Vietnam. Not much was known about him until Rolling Stone magazine tracked him down and got one of the best interviews yet. Rolling Stone reported that:

By February, it was topping the charts in more than 100 countries and had been downloaded more than 50 million times. Nguyen was earning an estimated $50,000 a day. Not even Mark Zuckerberg became rich so fast.

This level of attention and wealth prompted Nguyen to take down the app and buck the demand for his work. Within a couple days of his decision to remove the app, it vanished. Many criticized his decision and questioned why anyone making $50k a day would optionally take down their application. Frankly, I could relate on a tenth of the scale.

In December, January, and February I saw earnings that blew my mind. Every day I checked my earnings, I was looking at another couple hundred dollars. I was closing in or crossing $5,000 per month. I was scared about whether the affiliate company would actually pay me. Every month — before I got paid — I’d get nervous. I’d think, “Are my earnings going to be revoked? Am I actually going to get paid that much?” Month after month would pass, and the earnings would clear — right into my bank account. It was like magic.

Average these earnings over 12 months, and I’d be making over $60,000 per year. Meanwhile, I’m a full-time graduate student working 65+ hours a week. With all my earnings combined (regular work, too), I was nearing a six-figure salary. My debt was disappearing and life was looking up in a crazy way.

The earnings eventually slowed. The bulk of the money was earned. I paid off a $25,000 student loan and stopped taking out loans for school entirely. Suddenly, I was paying in cash for the deficits in my graduate assistantship budget.

Marketing and advertising affects everyone

You’ve now read nearly the entirety of this article, but I still haven’t shared how much a blogger can make. Or, more specifically, how much I made in my first year. Before I say that value, I want to mention one thing: advertising tends to taint perspectives.

As a personal finance writer, there’s a wealth of advertising opportunities. It’s a direct consequence of the powerful financial services sector. Trillions of dollars are managed within financial companies, and consumer credit products are just one of the many revenue sources they have. It can be easy to be swept up with the possibilities and ignore the initial purpose for starting a blog.

I got swept up by it. I was deeply affected by it. It changed how I speak. It swayed my opinions.

After you see this value, I hope you take great care with your site and visitors. Please don’t let this inspire you to morph into a credit-card-hawking-affiliate-driven-market-maven. The personal finance world needs personality and reality. Credit products aren’t right for everyone.

Still want to know how much I made?

I made about $35,000 in my first year of blogging.

Related post: Make An Extra $10,000 In 6 Months!

Should You Ditch Your Car Loan? 10 Questions To Ask Yourself

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Should You Ditch Your Car Loan? 10 Questions To Ask Yourself

Find a car, take out a loan, hand me the keys

In the summer of 2011, I bought a used Honda Civic. It was my first car buying experience. I had emailed a private owner through Craigslist, and found a time to meet and test drive the vehicle. After inspection and various checks at a local dealership, it was blessed by the car gods mechanics. Then and there, I decided to purchase the car for $11,000.

Naturally, as any indebted American knows, I didn’t have the funds to purchase a car. I was fresh out of college, with about $3,000 in savings. The only thing that made me creditworthy was my successful use of credit cards in college and a predicted income that could support the purchase of a vehicle.

The owner and I went to a local bank to see a notary and have a teller confirm the funds contained on my bank loan check. I wrote in the total purchase price and handed it over. In exchange, I was given a couple sets of keys.

The car was mine — all mine.

Honda Civic Coupe Car LoanLet the car loan payments begin

At nearly $200 per month, my five-year car loan is difficult on my budget. Unfortunately, when I first purchased the vehicle, I didn’t really have a budget. My budget was based on my ability to receive $15-20,000 in student loans every year — despite my tuition being paid for by a graduate assistantship.

Every month I was bleeding red, as the car loan payments would take any surpluses. But even more, I still didn’t have a budget to stick to and stay accountable for. Instead of selling or never buying the car, I convinced myself that I needed this automobile — at this price and quality.

My choice to buy a 2006 Honda Civic bordered on the egoistic. The voice inside my head said, “You deserve this nice car, Sam.” But the burden of spending $200 per month on top of student loans that were costing me 6.8% APR was a rough combination. It contributed greatly to a precipitous fall in net worth.

I could never properly calculate the true cost of the car, my student loans, and where my total debt would be in the following days, months, and years. Having a car — or, more specifically, a car loan — complicated everything.

Consider other options later, buy now

The entire buying process is like a wild carnival — walk in and you’ll see rides, games, laughter, prizes, and more. Browsing for cars at dealerships makes you feel special. People suddenly approach you, wondering what you’d like to buy, drive, lease, etc.

Car buying — whether with a private owner or dealer — is an American rite of passage. We own about 250 million vehicles between a population of 319 million people. Everything about this process seems tailored to these expectations about ownership and independence — powerful cultural values.

This swirl of attention, cultural identity, and peer support affected me when I plopped the original $11,000 to purchase my Honda Civic. I only considered other options (i.e., cheaper vehicles or not buying a car at all) about a year into my car loan. It was then that I realized all the powerful financial consequences of my decision.

Think: Debt, burden, liability, and depreciation

I hate to be another consumer, loving an inanimate object, but I have a real affinity for my car. My Honda Civic has taken me all over the midwest. When I moved to Iowa, I packed everything I could into my car and gave away what was left. It’s been my trusty sidekick for a while now, but it’s time for us to depart.

I finally listed it on Craigslist.

With nearly $200 a month in car loan payments, inevitable depreciation, insurance costs, and other debts that are demanding my attention, it’s time to finally sell my car. Not only is it the frugal thing to do, but the car has become a real luxury for me — there are other ways (i.e., the free bus) to get around in Iowa City.

Hopefully I can sell the car reasonably soon. I’d love to be able to reduce my monthly bills and start saving even more. I came up with a little list of questions to ask before ever buying another car again. Maybe these will help you resist the urge to splurge or even sell your car!

Questions for the car buyer/owner/seller:

  1. How much will this vehicle cost you over 10 years?
  2. Do you currently have an emergency fund set up to handle accidents and/or insurance premiums?
  3. How often will you drive your vehicle and for what purpose?
  4. What size vehicle do you need?
  5. How do you currently manage without a car (if you do not own one yet)?
  6. What’s motivating you to purchase this specific car?
  7. How do you feel about the impact your greenhouse gas emissions will have on the environment?
  8. What would the car provide that a regular bike could not offer?
  9. How would your budget deal with a spike in gas prices or if insurance premiums rise?
  10. Will this impact how many hours you need to work or extend your period before retirement?

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