Andy Hough

Book Review: Debt Free for Life

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David Bach has written another personal finance book, Debt Free For Life: The Finish Rich Plan for Financial Freedom.   In this book Bach gives general advice about getting out of debt.  I can’t say that there is anything wrong with the advice but if you have read or listened to Dave Ramsey or any other anti-debt gurus this advice will be pretty familiar.  His advice against getting in debt is somewhat contrary to the advice he gave in The Automatic Millionaire Homeowner: A Powerful Plan to Finish Rich in Real Estate.

He also uses the book to promote the company Debt Wise which is a partnership between the author and the credit bureau Equifax.  The company  automatically calculates the order and how much you should pay toward each account in your plan every month using Bach’s debt stacking strategy.  This is something you could do a close approximation of yourself pretty easily so I don’t think it is really worth $14.95 a month but I suppose some people would find it worthwhile.  There is another company  DebtGoal that offers a similar plan and they also charge $14.95 a month so I guess that is the going rate.

If you haven’t read other books on getting out of debt than I would recommend this book as a good resource on what you need to do to get out of debt.  If you have already read books on getting out of debt such as The Total Money Makeover: A Proven Plan for Financial Fitness than this book will probably not provide you with any new information.

Online Income Report – March 2011

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Here is a breakdown of my income for March 2011. .

Google Adsense – $181.79

Affiliate Income – $295

Brokered Ads – $41

Direct Ads – $231.55

Ehow – $11.01

Amazon – $15.54

Ebay  – $9.54

Total – $785.43

My online income increased from the month before so I won’t complain.  I believe that if I work on my sites consistently I will make over $1000 a month by the end of the year.  I have had a dry spell for affiliate income though and need to fix that.  I’d like affiliate income to make up the lion’s share of my income because I think it has more upside potential than Adsense or ads. 

 

March Investment Income – $100.13

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My March investment income rose to $100.13 from $97.32 the month before.  I’ve been close to hitting the $100 mark for a few months and finally made it.  The increase was all from the rise in value of the stocks and funds in my investment portfolio since I didn’t add anything to my savings.  It will probably be at least a couple months before I add any money to my investment portfolio so any further gains will depend on the stock market continuing to do well.

This is not my actual investment income. To get this figure I first add up my retirement savings, emergency fund, and any other money I consider permanent savings. What the total of my savings would earn at 6% interest for a month is my monthly investment income. My goal is to get this amount to $1000 a month. If I have $1000 in monthly passive investment income I will be able to retire early. You can see what my actual investment income for the month was by looking at my monthly income report and adding the interest and dividend amounts.

March Income – $5081.86

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Here is a breakdown of my income for March.

Online Income

$775.92

Interest

$7.51

Stock Dividends

$97.56

Mystery Shops

$144.64

Survey/Cashback

$26.23

Medical Study

$2130

Tax Refund

$1900

Total

$5081.86

March was a great month for income.  I received all of my study pay at the end of March.  It might have been more accurate to divide the pay up between February and March since I earned it both months but since I use cash basis accounting I don’t count the income until I actually receive it.  The other big income boost was the tax refund.  We received a pretty big refund but since we lose an exemption this year and also lose the making work pay credit we won’t have nearly as big a refund next year.

April income will be much lower since I won’t have those two big sources of income.   I did a lot of mystery shopping in March which will be reflected in April’s income so there should be an increase there.  I should do about the same on the rest of my alternative income and passive income sources.

March Expenses – $2152.28

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Here is a breakdown of my expenses for March.

Household

$697.47

Entertainment

$328.44

Transportation

 $574.49

Food

$70.94
Medical/Dental

$57.44

Utilities

$61.11

Phone

$35.02

Travel

$313.37
Debt $14

Total

$2152.28

My expenses were very high in March.  Some of that is because we used our tax refund to buy a Wii and take a vacation.  I probably shouldn’t have counted the total cost of those as my expenses since I’m not counting the tax refund as only my income.  Sometimes it is difficult for me to determine what I should count as my share of the household income or expenses but this should be close enough.

Transportation was high because we did a lot of driving for our vacation and mystery shopping and also because I paid for the next six months of insurance.  Entertainment was also high because of the vacation.

I decided to display my phone bill separate from my utilities to give a more detailed breakdown of my expenses.

In April the expense categories of entertainment, travel, and transportation should all drop quite a bit.  I’m sure I’ll still be well over my $1000 goal but expenses should at least be less than income.  I’m thinking expenses should come close to the $1000 level in May.