Today's post is from Crystal, who claims she did a reader profile some years ago (though neither of us can find it). As such, she decided to do an "update" using the questions I normally ask for a profile. Here goes:
Please tell us a bit about yourself.
My name is Crystal, I'm 30 years old, and I live in Houston, TX with my husband, our two dogs, my younger sister who rents a room upstairs, and two of our friends that rent the guest bedroom downstairs. Yeah, it sounds like a boarding house, lol, but it all happened sort of by accident and has worked well for all of us so far. I've been a reader and commenter here on FMF since October 2009. In fact, FMF himself and a few of you readers were the ones that encouraged me to start my own site, Budgeting in the Fun Stuff.
I submitted a Reader Profile a couple of years ago, but a ton has changed since then. For example, I made the leap into self-employment in July 2011 and my husband joined me in January 2012. I wrote a pretty popular eBook in July 2012 and it has sold nearly 600 copies. I was also a speaker about self-employment at The Financial Blogger Conference last year.
We paid off our first house earlier this year and moved into our new home late last year, so we still have a mortgage and property taxes, but we have a paid off rent house too. The rental income from that house and our roommates covers our mortgage and both sets of property taxes a little extra.
Describe your financial situation (who works in your family, how your income is (general), how your expenses are, etc.).
I started Crystal For Hire in April 2011 when I started running blog advertising for others. I was also staff writing for about 13 sites a week at one point in late 2011. Between my freelancing and my blog income, I was able to quit my day job in July 2011.
My husband joined me to help in January 2012 since I was getting burned out with 80-100 hour work weeks and he wasn't really enjoying his time in the public school system as a teacher and librarian. Our business has had some big ups and some worrisome downs, but we have been holding to a steady income for about 2 years total. Here is our full financial breakdown:
- Online Income Average - $8000
- Rental Income - $2300
- Hobby Job Income (hubby is a varsity football and softball official and I am a Chick-Fil-A mascot kid cow) - $200-$1000
- Total - About $10,500 in a Low Month
- Income Taxes – $2500
- New-to-Us Car Fund – $500
- Home Mortgage – $990
- Home Insurance/Property Taxes/HOA – $750
- Rent House Home Insurance/Property Taxes – $275
- Health Insurance – $360
- Life Insurance – $30
- Car Insurance – $55
- Electricity – $175
- Water – $60
- Natural Gas – $40
- Gasoline – $150
- Eating Out – $250
- Groceries – $250
- Sprint – $150
- Cable/Internet (DSL) – $110
- Medicines – $20
- Toll Roads – $25
- Housekeeping – $175 (average over the year)
- Lawn – $80 (average over the year)
- Miscellaneous – $200
- Cash – $100
- Total Expenses = $7245
- Roth IRA’s – 80%
- Rental Property Maintenance Fund – 10%
- Vacation Account – 5%
- Fun Money Accounts – 5%
What are the current financial issues you're facing (saving, paying off debt, etc.)?
Not knowing how long we will continue being able to work from home is the hardest part of self-employment. Financially, we know that we are doing really well right now, but online blog advertising could dry up at any time.
We manage our income by moving everything from Paypal to a CapitalOne 360 blog income savings account (formerly ING Direct). Then we pay ourselves $4000 biweekly from that account automatically. $1250 of that is also automatically squirreled away for taxes, so we end up paying ourselves $2750 every two weeks to cover the rest of our monthly spending. Whatever is left after our bills are paid is divided up like I said above.
We have a $10,000 emergency fund, $15,000 padding in our blog income account, and side accounts for a new-to-us car, home maintenance, vacations, fun money for each of us, and for future investments (to eventually be used in Scottrade, to fund a SEP IRA, or to maybe buy another rental property). Our only debt is the $205,000 left on our current mortgage at 4%.
What would you do? Invest in stocks (we like stable, high dividend ones like J&J), pay off the current mortgage, buy a new rental property, or hide as much as possible in a SEP IRA?
What are your plans for the future (retire early, build your career, etc.)?
I used to make 30 year plans, but self-employment is a little less stable-feeling. So our current plan is to ride this horse until it bucks us. I love working from home for myself, so I think I could do this indefinitely. Even if blog advertising ever dies, I can continue staff writing and writing eBooks (working on my second one now). My husband seems to feel the same way but I sort of hope he finds something for himself that he likes even more since he still feels more like an employee than a co-owner. He needs his own thing that makes him happy. Maybe sports officiating at the college level or something like that. We'll see. Overall, our general plan is to become financially independent as soon as humanly possible just so we can choose what to do with our time from there. Currently, we are aiming for that by age 45-50.
What's your best piece(s) of financial advice and/or your general philosophy on personal finances?
Keep your expenses as low as you realistically can. The lower your monthly nut, the easier it is to cover. At the same time, find something that you absolutely adore to do and make a business of it. Self-motivation is a force of nature...it drives success more than I could ever imagine. We actually haven't followed all of our own advice, lol. Our expenses should be about $500 a month lower than they are now because of splurging. But we also like the time our splurges buy us and the entertainment value, so at least our eyes are wide open.
When I started reading and commenting on FMF in 2009, I was planning to work a cubicle job for a car dealership software company until I was 55 years old for $35,000-$40,000 a year. My husband planned on continue being a school librarian until he was 52 for about $48,000 a year before he could retire with a pension. Now we are both around 30, bring in about $125,000 a year, and just want even more control over our time. Between 2009 and now, we have pretty much changed everything about our lives. Time is priceless and we just hope we are spending ours as wisely as possible.