July 2009 Goal Review

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It is the end of the month and time once again for my monthly goal review.

My first goal is to increase my passive income. I made slight progress on this. I purchased another dividend paying stock. I’d still like to buy a rental property if I can find a good deal. Since I’ll be hiking most of August I’m unlikely to do anything towards this goal for the month.

My second goal is to lose 30 pounds. I went backwards on this one. My weight has now gone up to 225 pounds which is the most I have ever weighed. I’m hoping to lose a lot of this weight on the hike but having all this extra weight will make hiking a lot harder. At the end of August I should have some good progress on this goal.

My last goal was to increase my RSS subscriber count to 500. I made progress on that goal this month. I hit a high of 430 subscribers during the month and I am now consistently over 400. This is without doing anything special to promote this site. Hitting 500 subscribers still seems like a reasonable goal and I will do some promotion later this year to help reach that number.

I met two out of my three goals this month. For August the only goal I really want to make progress on is losing weight. If I manage to lose a significant amount of weight and just maintain on my other goals I will consider that a successful month.

June PPC Campaign Results

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I ran a PPC campaign for my site BankBonuses.com during June to make a little extra money. I’ve run PPC campaigns in the past with mixed results. I usually make either a very small profit or a very small loss. I’ve been making adjustments to hopefully make my PPC campaign consistently profitable.

My initial results for June were disappointing when I examined them at the beginning of July. My revenue from Adsense and Chitika were a couple dollars less than what I spent on Adwords and I had no affiliate sales. My goal is to have my ad revenue equal my PPC expenditure and any affiliate sales will be profit. As it turns out I did have an affiliate sale in June but it didn’t post until a few days into July. I also found out that I had a couple of $25 Wachovia Visa gift cards in the mail for referring new customers. I don’t have any way of tracking where the referrals came from so I am going to guess that one was generated at Bank Bonuses and the other one was generated by my eHow article on the Wachovia $25 referral bonus. These unexpected earning combined to create a nice profit for June.

I’m running the PPC campaign again this month. I’ve already made an affiliate sale although it is for a smaller amount due to a promotion they have running this month. My ad revenue is running slightly higher than my PPC expense and I’ve made a couple more Wachovia referrals in addition to a couple of ING Electric Orange referrals. Even if I don’t make any more sales I will once again have a nice profit this month.

Even though I’m making a profit the past couple of months it still isn’t a lot of money. There are lots of things I could do to improve my site and my PPC campaign. I’ve been reading ShoeMoney’s PPC course and once I’m finished I will be implementing some ideas from the course. If I can be consistently successful with this PPC campaign I will start some more campaigns. I’ll keep you updated on my results.

Save Money with Back to School Sales

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One common frugal tip is that you should stock up on an item when it is on sale. Stores are starting to have their back to school sales. This is an excellent time to stock up on school or home office supplies. The large department stores and office supply stores have a variety of merchandise for extremely low prices.

For example, Staples currently has many items free after rebate, Wal-Mart is selling 70 sheet notebooks for .15 cents, and K-Mart is selling Elmer’s glue for .20 cents. That is just a few of the deals available and there will be new ones every week for the next few weeks.

About a decade ago I took advantage of a cheap notebook offer and I haven’t paid for paper yet. During my four years in law school I never purchased any school supplies. I either already had the items needed or was able to get them for free. With a little planning you can stock up on supplies as well and not have to buy them again for years.

Frugality 101: Housing

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Housing is the area where most people can see their most significant savings. Most people live in too big of a house and spend more than necessary on housing. The average U.S. home size has gone from 1400 sq. ft. in 1970 to 2330 sq. ft. in 2004. Granted the average American has gotten larger during that time period too but it isn’t like they are taking up that much more space.

My housing cost has been around $400 the past few years. With a little effort I could reduce that and I probably will before the year is up. I think $400 a month is a reasonable target for your housing expense. It is much easier to do here in the Midwest than in other areas but it is possible in more areas than you would think. My best friend lived in the S.F. Bay area last year and paid $400 a month for a room in a house right by the ocean. Even in some high cost areas you can find reasonably priced housing if you are willing to be a little unconventional.

If you find the $400 amount too constricting you could consider keeping your housing expense at 20% of your income. That would still keep your housing cost below average and should allow you to save a significant percentage of your income.

If you still think it is impossible to do this in your area then you might consider moving to a different location. I’m going to do a separate post on location in regards to frugality.

If you need some ideas on how to lower your housing cost check out “Twelve ways to become rent or mortgage free” at Wise Bread or check out Jacob’s post on living in a RV at Early Retirement Extreme.

My Stock Portfolio

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photo credit: kevinzhengli

Some of you have expressed interest in what stocks I own. I’ve been reluctant to share this since I’m not a stock expert and I don’t want my portfolio to be seen as advice on what you should buy.

I currently have twelve stocks in my portfolio. It would be better to have more but this is what I can afford at the moment. These are the current holdings in my stock portfolio: Bemis (BMS), British Petroleum (BP),Consolidated Edison (ED), Great Southern Bank (GSBC),Johnson and Johnson (JNJ),Coca-Cola (KO),McDonald’s (MCD),Realty Income (O),Pitney Bowes (PBI),Power Shares International Dividend Achievers (PID),Ship Finance (SFL),Universal Health Realty Income Trust (UHT).

Most of these stocks were chosen because they had a consistent history of raising dividends or had a nice dividend yield. Ideally they would be like O and have both. An 8.4% yield and a consistent history of increasing their dividend since their listing on the NYSE in 1984. I don’t particularly like investing in funds but I have PID since I am under diversified and need more international exposure.

My return on investment since I started investing last October is 4.9% or 7.2% annualized. The actual ROI is higher than that since I didn’t invest all my money at once, I’ve been slowly adding to my portfolio since then. I just calculated this figure for this post and initially thought this wasn’t a very good performance. Considering the S&P 500 index lost 22.56% the last quarter of 2008 and is down 2.67% this year my performance looks pretty good.

This performance would be a lot better if I would have been quicker to unload GE. On the other other hand if I hadn’t bough GSBC, which more than doubled, my performance would be a lot worse. That is how diversification works. If one stock sucks, there should be some others that pick up the slack.

My initial plan for this portfolio was to eventually have enough dividend income to cover my monthly expenses. I’m no longer sure if I’m going to pursue that plan since I’m looking at having a wider variety of investments. I’ll still have stocks they will just be a smaller percentage of my investments overall.