Friday, September 10, 2010

Blogging - diaries from a beginner blogger entry 1

The purpose of my blog is to discuss personal finances management as a way of pursuing and achieving financial independence.

I consider myself to be a beginner blogger. This blog has been going since early July, there are not many posts so far and the traffic is...lets just say there is a lot of room for improvement.

There are a couple of that motivated me to start this blog. (1) To learn more about personal finances management (2) to learn about starting small online businesses and of course (3) to make some money on the side.

So how am I going? The following sections outline how I am tracking against my objectives.

(1) To lean more about personal finances management

For quite a few years I have been accumulating some unsecured debt. Although I have had a good income we lost track of the value of money and started spending more than what we earned. We ended up in a bit of a mess, we are not out of it yet but we are making progress.

I can afford the repayments and the debt is reducing slowly, nevertheless about 1-2 years ago I started to get worried about it and wanted to take control of the situation.

I then started to voraciously read books about personal finances and investment. I read books from Robert Kiosaki, Multiple Streams of Income and, the most influential of them all, The Science of Getting Rich. I was motivated by these books to do something about my financial situation. I also learned a lot about accounting principles to help me to manage my finances. I learned what a real asset is, how important cash flow is and much, much more.

Knowing the concepts is somewhat useless if they are not put into action. The most important advice I got from these book was to learn about personal finances and to act, to do something about the situation.

The best way of learning something is putting the theory into practice and  also teaching someone else. That is how this blog started. It is a way for me to put my thoughts down into paper, the electronic paper, and to learn more about personal finances as I go.

I also try to apply all of the concepts I read and blog about in my real life as I manage my finances. To my surprise, and I shouldn't be surprised, it is working. By applying the theory in real life I was able to reduce a bit more of a debt and to also increase my yearly income (see The Science of Getting Rich to find out how I made $40K from applying the concepts in the book).

I mentioned earlier about doing something. The books I read inspired me to act, to do something. This blog is not only a way for me to learn but it is also my first step towards my plan to open small online businesses. I had to start somewhere so I decided to start a blog.

This leads me to my second objective.

(2) To learn about starting small online businesses

Another important topic that I learned from reading the books I mentioned above is the importance of generating passive income and to make extra money to help me to pay off my debts.

There are many ways of generating passive income, topic for another post, but quite a few of them involve the investment of a lot of capital which is something that I don't have at the moment. I therefore continued to think, instead of getting  discouraged, and I started to look at web based businesses.

I needed very low cost, or no cost, ways of starting  business. Well, a blog is a no cost way of starting a business. I consider this blog to be my micro business. It does not matter if it doe not generate a lot of money so long as I am learning from it and so long as I can grow it and turn it into something bigger which generates a small stream of income.

This blog costed me nothing so far. I already had an internet connection and a computer so no extra costs there. All of the other tools are free and available on the internet.

So there you go I have a micro business which is generating me....nothing at all. No income has been produced in the past 2 a bit months that this blog has been going. I should rephrase, according to the adsense reports I have made about AU$ 7c. Yes that is it 7 cents. I digress because I should be discussing this in my third point.

To go back to the point about online businesses, when browsing the internet I always saw lots of advertisement about how people are making money with blogs and other online ventures. Being a computer programmer by trade naturally takes me towards online businesses.

This is great because it costed me pretty much nothing, apart from time, to start this small site. The way I see things, and the way I operate, is that if I don't do something concrete about whatever objectives I have I loose motivation and quite honestly end up doing nothing. So starting a blog is a way to move closer towards a bigger objective to have a few online businesses generating money on the side.

I have learned from other blogger that it takes a lot of time to develop a blog and to make money from it. I read a blog the other day  and it mentioned that it took 7 years for a very well known blogger to make the first $1K. That is quite a lot of time and it requires a lot of patience.

I will try to remain motivated and to continue to learn about personal finances and web business through this blog. So long as I am doing this, making money from it is a nice but secondary objective.

There are quite a few things for me to learn including generating traffic, monetisation and other important topics relating to blogging.

For me the important thing is that I have started and now I am on the way towards achieving my objectives.

(3) To make some money on the side

The final objective is to use this blog as a small stream of income in order to enable me to grow it and to help me to pay off my debt.

As I said above I have invested no money at all in this blog. My plan is to eventually get my own domain name and start my own site with a blog in it. Having said that I want to do this by using income generated from this website in order to grow it.

I will not wait 7 years for it. If it takes too long for me to start to make money from this site but the traffic is increasing, I may invest a few bucks and get a domain name and hosting for my own site. I feel hesitant about doing it now because I am getting so little traffic and I am want to grow this blog before I take my next step. I will review this approach as I go.

So there we go, I have summarised my objectives for this blog and my progress so far. I intend to publish
a diary entry every couple of weeks, or maybe every month to keep track of how I am doing.