The Finance Castle

p>While I tend not to be all that vocal about my political views to others, as a citizen I try to stay relatively well informed about ongoing political issues. Being a long time writer about Personal Finance, I have always thought how the government borrows and spends was fascinating. The numbers just balloon beyond comprehension so quickly it is almost laughable to think about, and tracking and managing that spending must be an absolute nightmare. Still, the bottom line is that the U.S. Government has been spending well beyond its means for decades, and the problem is finally starting to draw more serious attention. At the end of the day, someone is going to get hurt, no matter what decision the government makes or the approach it takes to get the national debt under control.

The parallels to our own financial situations are easy to deduce, especially given the dire straits that many Americans find themselves in today. After years of borrowing to consume, we reached a point where reality slapped us in the face with the real estate collapse. Without a credit line, many of us have realized that borrowing to live is really no way to live at all since, eventually, you have to pay that money back. Habit changes, painful at first, to live below our means are becoming increasingly widespread. The more you borrowed, the more difficult you have probably found it to unwind your debts and get back to stability. Worse still, those that were barely scraping by under a pile of debt were immediately crushed when they were hit with the first sign of adversity. It is a stress that no one wants to live with, wondering if they will keep their house, car, and life. It is a fear I try to fight off even as I work to keep my emergency fund full and my retirement account happy.

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Likewise, for years, the government has spent money without a thought even if it didn’t have it, because our credit line was so huge that no one would dare question our ability to repay. There always borrowers out there happy to pick up our debt because historically speaking, with a few notable exceptions, we were good for it. Yet now, it seems, we are starting to approach our limit. We aren’t there yet, and all of this Political grandstanding is more about the 2012 elections than the future of the Federal budget, which is all the more frustrating when you think about what is at stake. Don’t these people realize the fire that they’re playing with? No one wants to accept the fact that in order to get back on the right financial track, more than fat is going to have to be trimmed. We’re going to catch a little muscle and bone, too. Not good if you want to get re-elected, but necessary if you want to approach a balanced, long term plan to financial stability.

When I first left my full time office job, I was slammed with a chaotic mix of joy and fear. On one hand, I had a lot of good things going for me. Since the office was shutting down and being outsourced, we all got a rather generous severance package which could keep me afloat for at least a few months. I had also spent the last three years dreaming of an event that would spring me from the chains of my traditional 9-5 job and set me on the path to self employment. I”m not one to believe in fate, but I thought the office closing provided a unique opportunity for me to build a foundation. On the other hand, I was terrified. I have historically been a rather risk-averse person, and the thought of inconsistent income made me visibly uncomfortable.

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So I compromised.

I picked up a regular gig with a firm based out of San Francisco doing some technical writing for about 20-25 hours a week. That covers the basics like my mortgage, bills, etc. On top of that, I have three sites that I write for on a regular basis. I submit my posts, check is in the mail, and everyone goes home happy. Writing is unquestionably fun, and doing a review of the latest gadgetry on a bad day doesn”t even come close to the agony of waking up Monday morning trying to wish away your commute.  Yet as with most things, despite my generally laidback attitude, I”m still working on striving for more. My hydra of income needs to continue to grow, after all, and I want to ensure that my next sources of income will be unquestionably fun. It sounds simple on the surface, of course, considering every motivational blogger worth his or her salt tells us to follow our passion. Yet often times, your passion isn”t going to pay the bills. I really enjoy skiing, for example, but last I checked working as a ski patrol person doesn”t pay very well. Since I have my important financial bases covered, however, that leaves me with plenty of options in terms of how I want to make money going forward.

So far, there”s been a lot of brainstorming. My brother and I have been working together on a lot of collaborative efforts in the past, with a few hitting  moderate successes. I would love to have another side business that isn”t really about the money but really about the fun (money is always a nice plus). I”ll be sure to put up an update once we get closer to launching a new project, as right now my ideas look more akin to a dartboard, but just having the possibility to fuse together fun and work even farther than what i have setup so far sounds very promising.

So it appears that between my transition to being self employed and buying a house, the blog has managed to fall by the wayside. Well, no more! Finance is a more important part of my life than ever, and as a result I would really like to get back to a regular posting schedule. I won’t be able to post everyday like I used to, as my hands have gotten quite full of late, but I am going to get back to consistency.

So, now you can expect a post every Tuesday and Thursday! I’ll be back to focusing on personal finance stuff despite my recent swing to microbusinesses. Stay tuned!

This whole working for yourself thing continues to be full of surprises.  While I have consistently taken any income I have earned and put away 30% for when the tax man came to call, I was still a little saddened by the huge number my accountant came back with and having to take that money out of my bank account didn’t exactly fill me with the warm and fuzzies. Here are some highlights.

Pay Your Taxes Quarterly: Interestingly, you may be used to just having to do your taxes just once a year at your regular job, but those that pay their own way (or work as an independent contractor) must file their taxes and pay a quarterly bill. Not fun, but at least it helps lessen the ouchy feeling at the end of the year.

Tracking Expenses is Important: Being a freelance writer/markerter, I never thought there was really much to deduct on my taxes, but I have been proven wrong. Sure, you don’t want to be one of those guys that files crazy deductions and ends up getting slammed with an audit, but there are certain expenses that every small business person should pay attention to.

Filing Jointly: Being recently married,  I never really considered that our tax situation would change much after e tied the knot. It does. Be sure to talk to your accountant about how this affects your tax situation.

When I first heard about the popular site Fiverr, I was admittedly skeptical. If you are one of the few who hasn’t heard of it yet, let me spell out the basic premise. Just about anyone can hop on the site for free and throw up something that they would do for $5 USD. As you might expect, these talented people run the gambit, and products are included as well. You can have someone do voice over work for you, edit an image, draw a funny picture of your family, or order a mini Mario hat for your baby (OK so I made that last one up..but still..).

There is a whole lot of crap on the site since anyone can throw up a post, but plenty of legitimately talented people seem to do well on there. If you have the idea of hopping on there yourself, the name of the game is hourly rate. Don’t put up something that is going to take you an hour, as in all likelyhood you’ll get bored with it quickly or not make enough money for it to be worth your time. Me? Well, I decided to run with my Nintendo bead coasters on there, and so far things are looking good. I have sold about 10 coasters so far, compared to my 0 over at the Etsy shop I threw up.

Another idea would be to put together a variety of these talented people into some sort of pseudo team. If you could, say, sell birthday packages to parents with a funny picture, an image of superman giving your kid the thumbs up, and..I don’t know, custom made birthday candles, and sell it for more than $15.00, there is money to be made. Just tossing around ideas, but so far at the very least it has been good for my fledgling craft business.