Earlier today, I posted the first part of my monthly financial reporting, my April 2008 balance sheet. Publishing these reports online helps keep me accountable for my decisions and forces me to take a look at my progress each month.
After a great February and a good March, April was not quite as impressive. In fact, this is my lowest net income since last April. My net income for the month was significantly lower due to two specific reasons. I’ll explain more following the data. The chart is hard to read within the post, but if you click on the image, a larger table with legible numbers will open in a new window or tab.
Answers to Frequently Asked Questions.
The report is made with Intuit Quicken and Microsoft Excel. Here’s an income and expense report Excel template.
Explanation and Details.
My salary has stabilized after two months in which a raise, a bonus, and a promotion left my paycheck increasing each period. I expect to receive $3,846 every month for the rest of the year except one which will contain three paychecks. I don’t expect any changes to this number unless I decide to leave my position.
Business income has dropped significantly due to the elimination of text link ads on Consumerism Commentary. I’m giving up several thousand dollars in order to help ensure longer term growth. Google feels text link ads unfairly take advantage of the search engine’s algorithms for delivering relevant search results. Most of my business income is currently directly or indirectly reliant on Google in some form, so I’m doing my best to build websites in such a way that they will continue to be ranked highly.
I mentioned last month that traffic from Google to Consumerism Commentary precipitously dropped in March. The traffic levels seem to have returned to normal over the past few weeks, but the experience has reminded me that if I do what to turn blogging into a viable business, I have to find a plan that doesn’t rely so much on traffic from Google.
Other than the large tax bill and entertainment expenses this month, my expenses were fairly low in April. The tax bill should be obvious. I paid estimated taxes during 2007, but just enough to avoid an underpayment penalty. I spent money for a new camera lens this month, an upgrade to the lens that came with the original purchase.
I’m also spending more money for purely business-related expenses lately. When I have a chance, I will reorganize business expense categories. I’ve been using Quicken’s default categories which don’t reflect my expenses very well.
May will be an important month. At the beginning of the year, I set a deadline for me to decide whether I could consider becoming a full-time blogger by the end of June. Even with the income decrease this month, I still earned more from my internet endeavors than from my day job. But if I’m not earning significantly more than I can’t justify giving up my benefits and security. As I’ve mentioned, working for myself full-time will only be viable if I can increase non-advertising income.
Updated June 2, 2008 and originally published May 2, 2008.