Andy Hough

Lifetime Earnings Compared to Net Worth

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After reading a blog post at Afford Anything that discusses several books including the book, “Your Money or Your Life“, I decided to compare my lifetime earnings to my net worth. That is one of the recommended actions in the book to help transform your relationship with money. Although I read the book when it first came out in 1993 and several times since then I never compared my lifetime earnings to my net worth.

Figuring out my lifetime earnings was easily accomplished by going to SocialSecurity.gov and looking at my earnings record.  According to their records I’ve made $328,576 in 31 years of working. Since I’ve also had some earnings from paid medical studies that weren’t subject to SS tax I’m going to bump up the total to $350,000.

Determining my net worth took a little bit more work. Personal Capital tracks  financial accounts and shows you your net worth. Unfortunately, they don’t have the correct total for my student loan and I also have some accounts that I don’t track there so I had to determine my correct net worth myself.

Assets
Cash – $4387
Traditional IRA – $21,225
Roth IRA – $9,602
Loan – $1800
Car/Stuff – $5000

Liabilities
Student Loan – $125,331
Credit Cards – $10,593

Net Worth = $-93,910

Out of the $350,000 I’ve earned over my lifetime I have managed to accumulate -$93,910. I knew the total would be bad, but it is still a bummer to see the actual figure.

The credit card balance is from the 0% balance transfers I took out earlier this year to pay down my student loan. That might not have been the best strategy. Once I get the balance transfers paid off I’ll reconsider the best way to pay down my student loan.

It will probably be a while until I can improve my net worth since I have some big bills coming due in January. I also have a few thousand dollars worth of inventory at Amazon that would have made my net worth a little better. Since it is hard to determine a correct value for the inventory I left it out of the net worth calculation.

I’m probably going to start calculating my net worth on a monthly basis. If there is any interest I will share the results here.

November Income – $541.33

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Here is a breakdown of my income for November.

Online Income $0
Interest $3.57
Uber $41.50
Amazon FBA $441.21
Cash Back $44.55
Mystery Shops $10.5
Total $541.33

 

November was not a good income month. With the end of my job my income fell dramatically. Most of my spending in November came  from my last October paycheck which was paid just two days before the end of the month. Now that I’ve spent that I’ll have to make more money this month or draw down my savings. I’ve earmarked all of the money I got from my settlement for paying down my 0% credit card balances which were used to pay down my student loan. There will be no use of the settlement money for paying basic living expenses.

My FBA income should go up this month with all of the Christmas shopping. My sales increased quite a bit the last week of November and are continuing to do well this month. FBA income probably won’t be enough to cover my living expenses though. Uber is the most likely option for making more money. If I put in the hours driving for Uber I will make more money. My other income sources will likely remain the same and don’t really add a significant amount to my income.

I actually had some online income last month for the first time since July. Since I also paid for three years of hosting and for help transferring my sites to a new host I still lost money online last month. The days of making $1000 a month or more from my blogs are gone. It appears they won’t be coming back either. At least not from the same methods that made me money before. I’ve made some efforts to make money on my blogs from affiliates, but they haven’t had any results yet. I’m more interested in making money from FBA so I won’t be spending too much time trying to resurrect the blog income.

If I can’t get my income back up to a decent level this month I will have to start looking for another job. I’d much prefer to work for myself, but a job may be necessary to pay my bills.

November Expenses – $2584.55

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Here is a breakdown of my expenses for November.

Household $421.24
Entertainment $81.95
Transportation $102.70
Food $169.88
Student Loan $183.86
Travel $5
Phone $36.79
Health $1583.13
Total $2584.55

 

My November expenses were high due to paying $1500 towards my biopsy bill. If you take those payments away my expenses were almost at my $1000 target. My food expenses were a little high since I ate fast food way too much. All the other expense categories were okay.  My health expense should be back to normal this month and I expect all of my other expense categories will be about the same.

I Won’t Be Living in a Van in Florida this Winter

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van interiorI was planning to be writing a post this month about my plan to spend this winter living in a van in Florida. Unfortunately, that plan has fallen through.

The plan started when I was offered the opportunity to work my tax job remotely this tax season. Since this  gave me the option to work basically anywhere with an internet connection I decided I would like to live somewhere warmer than Kansas City for the winter months.  I’ve also wanted to give van living another try. That led to me deciding to live in Florida in a van for the winter.  The weather would have been great for living in the van. My expenses would have been low and my job would have paid the same which would have allowed me to save money/pay down loans at a good rate. This plan has now been scrapped since I was informed there won’t be any remote tax positions this year after all leaving me without a job.  Luckily, this notice didn’t come any later since I had just that morning looked at a van that I was seriously considering buying. Procrastination worked in my favor this time.

Now I need to figure out what I’ll do instead. I’ve thought of several options but I’m not sure which -if any- of the options I will take. The first option is to just stay here in Kansas City and drive for Uber and keep working at my FBA business. This would be the easiest option.  One drawback is that although Uber and FBA should make me enough money to pay my expenses I don’t think I’ll make enough money from them to make much progress on paying down my loans or saving money. Another drawback is that I’d still be in KC for the winter and I’d really like to get out of the cold weather.

Another option is to go to Florida (or maybe Texas) anyway and figure out how to make money once I’m there. Since I don’t have certainty of the tax job income I wouldn’t buy a van. I’d make a bed in my car and live out of my car. There is enough room in my HHR to sleep comfortably, but it would be pretty cramped to live out of. One good thing about this option is that if it didn’t work out I could come back to KC and I wouldn’t be out much money.

A third option would be to live in Guatemala for the winter. I know from experience that I could rent a room for about $100 a month and would be able to live very cheaply there. The airfare there and back would negate quite a bit of the savings though.  Also, I wouldn’t have a reliable way to make money there.  Perhaps, the biggest drawback to this option is that I would be committed to staying for the winter. If I changed my mind it would be quite expensive to change my plane ticket.

One more option would be to stay in Kansas City and find another job. This would be the most practical option. I don’t like this option much though. I’d really like to get out of KC for a while this winter and I’m doubtful that I could find a job that I like ok and pays well.

I’m sure there are more options than what I’ve listed here. Let me know what you think of these options and if you have any other options to share I’d love to hear them.

October Income – $4078.20

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Here is a breakdown of my income for October.

Online Income $0
Interest $4.15
Other Bonus $32.52
Amazon FBA $275.41
Job $3716.12
CC Bonus  $50
Total $4078.20

 

October was a great month for income. This was due to receiving three full paychecks during the month since the month had five Fridays.  Unfortunately, that job is over and I most likely won’t be working another job until tax season starts in January. I’ll need to significantly increase my Uber and FBA income to make up for the loss of the job income.

I didn’t have any Uber income last month since I was working full-time and didn’t want to spend my off hours driving for Uber. My FBA income fell significantly from the previous month since I didn’t put much time into it.  I also spent some of my FBA profits on an ungating service which will allow me to sell in a couple more Amazon categories. That should lead to increased profits. I’d like to get to $1000 monthly profit this month. That amount of profit is reasonably achievable. It is just a question of whether I will have enough cash flow to be able to buy enough stuff to sell to reach that level of profit.

This month’s income will be much less, but I’m hoping my income will at least exceed my expenses.