It's sad how many webmasters are great at making money and horrible at managing it

[Shap]

Having been in the industry for 10 years I've met a lot of interesting people. One thing that I find really sad is how bad the average webmaster's money management skills are. I know this is a product of our society as a whole but that doesn't make it right. In our industry this problem seems to be magnified because of the age and amount earned. You've got under 30 year olds making 6 figures a year and having no idea what to do with it. So what do they do? They spend beyond their means. Then one day everything catches up and the ride is over and they have nothing but memories (and maybe some pictures) to show for it.

I've seen it over and over again. I would say the majority of people I know have done a very poor job at saving what they've made. Most of them are living an amazing lifestyle they can't afford and are not that far off of being back where they started.... with nothing. The ride won't last forever. Be smart. Live below your means. Don't try to jump upwards in social class or style of life before you can really afford it. The fall back to reality will be that much harder. The money you make today, if managed properly, could set you for life. Think long term.

The interesting thing is the people I know that are best with their money also happen to be the most successful. It definitely isn't a coincidence. While the poor money managers are blowing money on retarded shit the smart guys are saving their money and waiting for opportunities. When those opportunities come up it's the people with cash that benefit the most. Even if the smart money guys aren't the first to see the deal/opportunity they still usually end up being a part of it. Why? Because if the poor money managers find that deal/opportunity they end up bringing the deal to the guys with money anyhow.

[HorseShit]

good points

[nation-x]

Originally Posted by Shap

Having been in the industry for 10 years I've met a lot of interesting people. One thing that I find really sad is how bad the average webmaster's money management skills are. I know this is a product of our society as a whole but that doesn't make it right. In our industry this problem seems to be magnified because of the age and amount earned. You've got under 30 year olds making 6 figures a year and having no idea what to do with it. So what do they do? They spend beyond their means. Then one day everything catches up and the ride is over and they have nothing but memories (and maybe some pictures) to show for it.

I've seen it over and over again. I would say the majority of people I know have done a very poor job at saving what they've made. Most of them are living an amazing lifestyle they can't afford and are not that far off of being back where they started.... with nothing. The ride won't last forever. Be smart. Live below your means. Don't try to jump upwards in social class or style of life before you can really afford it. The fall back to reality will be that much harder. The money you make today, if managed properly, could set you for life. Think long term.

The interesting thing is the people I know that are best with their money also happen to be the most successful. It definitely isn't a coincidence. While the poor money managers are blowing money on retarded shit the smart guys are saving their money and waiting for opportunities. When those opportunities come up it's the people with cash that benefit the most. Even if the smart money guys aren't the first to see the deal/opportunity they still usually end up being a part of it. Why? Because if the poor money managers find that deal/opportunity they end up bringing the deal to the guys with money anyhow.

I resemble this statement. I have started working hard on changing it in the last couple of months... but for a long time I just blew my cash on dumb shit.

[IllTestYourGirls]

I have the exact opposite problem. I never spend my money. You couldnt tell how much I make by the type of cars I drive or the clothes I wear.

I hate that it spreads to my business. I force myself to buy ads/traffic. I pinch my pennies too much. I know if I invested more I would make more but I always have a hard time bringing myself to do it!

But I do love the life I live. Living way under your means makes for a very easy enjoyable life.

[american pervert]

I've blown pretty much every cent I have made. However, I was smart enough to buy equipment when I had the loot.

[StuartD]

that's true Rich Dad

[Shap]

Originally Posted by IllTestYourGirls

I have the exact opposite problem. I never spend my money. You couldnt tell how much I make by the type of cars I drive or the clothes I wear.

I hate that it spreads to my business. I force myself to buy ads/traffic. I pinch my pennies too much. I know if I invested more I would make more but I always have a hard time bringing myself to do it!

But I do love the life I live. Living way under your means makes for a very easy enjoyable life.

You don't have to always spend it on your business. That's a choice each person has to make. At the end of the day the fact you are able to save a high percentage of what you make is the key

[Shap]

Originally Posted by nation-x

I resemble this statement. I have started working hard on changing it in the last couple of months... but for a long time I just blew my cash on dumb shit.

It's always a good time to start saving. The thing to beware of is since you've been spending and enjoying dumb shit for so long it will be really hard to avoid falling back into that trap.

[baddog]

Too many people here never had a job before, so budgeting is not something they ever learned.

[Sebastian Sands]

is this a Twistys newsletter?.. Bet all the smaller affiliates will love you tons now..lol

[Barefootsies]

Originally Posted by Justin

good points

True dat

[Shap]

Originally Posted by Sebastian Sands

is this a Twistys newsletter?.. Bet all the smaller affiliates will love you tons now..lol

Nope. Just something I've had on my mind.

Why would this bother a smaller affiliate?

[Supz]

Good post. This is true with most people in general. I see just as many people in other industries doing the same thing. Everyone wants to be a baller. If you are out busy spending all your money on bling. Then you can't re-invest it. And one thing we all know is, it takes money to make money.

P.S. Shap, it took me 30 minutes to read your post because I could only concentrate on your signature gif.

[Shap]

Originally Posted by Supz

P.S. Shap, it took me 30 minutes to read your post because I could only concentrate on your signature gif.

LOL Sorry about that.

[FrozenJag]

Excellent post.

Also try and make sure your partner in life is on the same page as you are.

I feel im above average at money management, sometimes I reinvest too much into my business though. Right now im working on building up a larger emergency fund before investing too much more into business.

Why?

Well its smart to have a 6 month emergency fund anyway, but if your in business for yourself your business needs its own (especially if you have employees) emergency fund aswell. Especially those of us that are pretty dependent on search engine traffic. It can all go away very quickly and leave you with a big dent in your income.

[CDSmith]

I posted a similar thread about money management several years ago here. A few people seemed to indicate that they got the gist of it, while several others scoffed at the idea of worrying about the future. I wonder how many of them are still around today, biz-wise?

Myself - from the first year I started I knew that there was going to be no more kushy retirement fund or benefits package to look after me like I had at the career I had just retired from back then. So I hired someone to set up several investment and retirement funds for me, and ever since then I've put money into those funds, every month. It's set up to automatically come out of my business account, I don't even see it.

When you're in business for yourself, no one's going to look after you but YOU.

Leave yourself nothing and that's what you'll end up with.

[Shap]

Originally Posted by FrozenJag

Excellent post.

Also try and make sure your partner in life is on the same page as you are.

I feel im above average at money management, sometimes I reinvest too much into my business though. Right now im working on building up a larger emergency fund before investing too much more into business.

Why?

Well its smart to have a 6 month emergency fund anyway, but if your in business for yourself your business needs its own (especially if you have employees) emergency fund aswell. Especially those of us that are pretty dependent on search engine traffic. It can all go away very quickly and leave you with a big dent in your income.

I agree 100%. I think it's always important to have a base (or emergency fund). Things can change quickly in business. You don't want to be left empty handed.

[Shap]

Originally Posted by CDSmith

When you're in business for yourself, no one's going to look after you but YOU.

Leave yourself nothing and that's what you'll end up with.

Quoted (and bolded) for the Truth!

[Barefootsies]

[woj]

very well said

[Sebastian Sands]

Originally Posted by Shap

Nope. Just something I've had on my mind.

Why would this bother a smaller affiliate?

Could be me just waking up and not having enough coffee n my system, but it comes a little bit "holier then thou" across.

Like I said could be me..

[WiredGuy]

I couldn't agree more, although I think its part of the adult lifestyle. We're surrounded by vices everywhere you look that it doesn't surprise me to see people blowing cash as fast as they get it. Thankfully I always run my business under the assumption it could end tomorrow.
WG

[Shap]

Originally Posted by Sebastian Sands

Could be me just waking up and not having enough coffee n my system, but it comes a little bit "holier then thou" across.

Like I said could be me..

I have seen far too many friends piss away what could have been money that would set them for life. All for very short term gratification.

How would you have written the post to not come across as holier than thou?

[Shap]

Originally Posted by WiredGuy

I couldn't agree more, although I think its part of the adult lifestyle. We're surrounded by vices everywhere you look that it doesn't surprise me to see people blowing cash as fast as they get it. Thankfully I always run my business under the assumption it could end tomorrow.
WG

You are the poster child of how someone should manage their finances.

[James124]

Originally Posted by Barefootsies

kissing ass and taking names...

[Slappin Fish]

Yes but without forgetting that managing and saving are two different things.

How you spend your money is what makes you rich, not how you save it.

[seeandsee]

i must agree!

[fuzebox]

It took me a couple of years of paycheck-to-paycheck to really understand the importance of saving and managing money, especially when the size of my affiliate payouts vary wildly month to month...

Thanks to my wife I've changed a lot over the last couple of years and now manage to save and invest a good 80% of what I make instead of blowing it as fast as I can

Funny how people don't realize that spending less is easier than making more.

[Shap]

Originally Posted by fuzebox

It took me a couple of years of paycheck-to-paycheck to really understand the importance of saving and managing money, especially when the size of my affiliate payouts vary wildly month to month...

Thanks to my wife I've changed a lot over the last couple of years and now manage to save and invest a good 80% of what I make instead of blowing it as fast as I can

Funny how people don't realize that spending less is easier than making more.

Well Said!

[Shap]

A great example of how smart money management can lead to huge success is one of the biggest (if not the biggest) affiliate programs and companies around today. Without naming them (because who they are doesn't matter) this company started with almost no money and started by submitting galleries to tgps. They took that money re-invested 100% of it. They expanded their gallery operations and decided to build free sites to control the traffic themselves. That worked, they re-invested 100% again and decided to control the paysites they send the traffic to. That worked and they continued to re-invest almost 100% of what they made and built themselves into one of the biggest most impressive companies in our industry today. All with almost no money to start. Not to mention these guys came into the market almost 5 years after most of us. These guys are at the top of the industry and they don't drive bentley's or ferrari's or live in $15 million mansions. They could but they don't.

[Biggy]

good advice. although it will have little impact. i find people are who they are - those that will listen already know this - those that won't, will never take this advice. its just not in their blood or personality.

also, companies overspend too. you can find out a lot about a company by seeing their office, how many employees they have, how nice and re-modelled it is, etc. against company's offices who may not look as nice. a lot of ppl tend to be prideful of having so many people work for them as if that in itself is an accomplishment, i personally see it as one huge expense and liability if a lot of the people are unnecessary.

[Joshua G]

good stuff. hey shap since your watching this thread can you please help with with a little question. should a rookie webmaster go with CCBill or NATS for an affiliate backend? i saw your thread years back about how dedicated affiliate software helped launch your sales vs a processors program. What would be your advice to a newb today. Thanks in advance.

[Shap]

Originally Posted by Biggy

good advice. although it will have little impact. i find people are who they are - those that will listen already know this - those that won't, will never take this advice. its just not in their blood or personality.

also, companies overspend too. you can find out a lot about a company by seeing their office, how many employees they have, how nice and re-modelled it is, etc. against company's offices who may not look as nice. a lot of ppl tend to be prideful of having so many people work for them as if that in itself is an accomplishment, i personally see it as one huge expense and liability if a lot of the people are unnecessary.

I know what you mean. The overspending helps you and I. We can sit back and then jump all over the juicy opportunities they leave behind for us

[Socks]

I'm still spending money from '88! -- Jay Z. ;)

One that stuck with me was this:

$72 saved and left alone, at 6% interest, over 36 years turns into $586.
$7,200, into $58,600.

[Shap]

Originally Posted by joshgirls

good stuff. hey shap since your watching this thread can you please help with with a little question. should a rookie webmaster go with CCBill or NATS for an affiliate backend? i saw your thread years back about how dedicated affiliate software helped launch your sales vs a processors program. What would be your advice to a newb today. Thanks in advance.

Email me at mrshap at twistys. There are a number of factors that come into play. My personal preference will always be Nats. There are a number of reasons for it. That may not be the right answer for you. Your situation, business plan, outlook etc factor into the decision making.

[Shap]

With the economy the way it is there are so many people needing to dump valuable commodities, properties, entities etc and bargain basement prices. The people who are wise with money will be able to exploit other people's poor money management and make a fortune (small or large) in doing so.

[Socks]

Originally Posted by Shap

I know what you mean. The overspending helps you and I. We can sit back and then jump all over the juicy opportunities they leave behind for us

Carlos Slim turned that concept into top spot as world's wealthiest man for a while these past years. And as a MEXICAN!

Basically when the country endured a horrible recession, his scrimping and saving had left him in a great cash position. He was able to buy some of the biggest companies in firesales, and then grew them.

People joke that you can be sitting in his restaurant, in his mall, watching TV through his cable company, talking on a cellphone on his network... It goes on.

[MetaMan]

Totally agreed i am young enough and working towards changing this, i think sometimes for people it is a process including me, now i have reached a maturity where i care less about the party lifestyle and now i am focusing more on the future.

i look back and i def "blew" alot of money in places but those were good years when i was younger and i was still looking towards building a business at that time which most early 20yos do not.

but those are done and now ive turned serious about my business. i figure i am only a couple years away of "sacrifice" to live the lifestyle that i have always dreamed of.

[tony286]

I think a problem is they treat the money likes its all theirs. What I have found is best is setting up a llc and llc bank accounts. Having pay periods just like a real job. Those checks dont involve emptying out the account each pay period. Decide the bank account needs a base to anyways be there be 5k, 10 k , 200k whatever works for income and expenses.
We always had a rainy day fund since we started maybe it comes from me being in commission sales and my boss used to say for a salesman its best to live like its low tide. If it was fornt that fund we would went out of business when ibill fell apart. For 3 months we had zero money coming in and were buying a house and moving an office. That fund was a lifesaver.

[Shap]

Originally Posted by tony404

I think a problem is they treat the money likes its all theirs. What I have found is best is setting up a llc and llc bank accounts. Having pay periods just like a real job. Those checks dont involve emptying out the account each pay period. Decide the bank account needs a base to anyways be there be 5k, 10 k , 200k whatever works for income and expenses.
We always had a rainy day fund since we started maybe it comes from me being in commission sales and my boss used to say for a salesman its best to live like its low tide. If it was fornt that fund we would went out of business when ibill fell apart. For 3 months we had zero money coming in and were buying a house and moving an office. That fund was a lifesaver.

Smart. I know you and I both took a huge hit with iBill. Hits like that can be the end of a business if you haven't properly planned and managed your money.

[TheAmericanCannibal]

so true Shap.
I know so many webmasters and company owners who are in dire straits right now.

Guys like me don't live on credit cards, don't own huge houses, I pay cash for almost everything - and yet people can never figure out why I am so flush.

I am frugal but not cheap.
I save my money, and make wise decisions on where to invest it.

I never played the market big- didn't invest in mutual funds or a 401K.

IRA's are great for saving money, but it's money that is out of sight and out of mind for retirement, also a great tax break.

So I feel bad for some people who pissed their shit away- but I have to tell you there ain't THAT many I truly feel sorry for.

They make their own beds that they have to sleep in.
Even if their new beds may be cardboard boxes.



PS- The Aaliyah Love pics Dean took this week were AMAZING!!!!
We loved them

[Miguel T]

So very true... sadly.

[FrozenJag]

Originally Posted by fuzebox

It took me a couple of years of paycheck-to-paycheck to really understand the importance of saving and managing money, especially when the size of my affiliate payouts vary wildly month to month...

Thanks to my wife I've changed a lot over the last couple of years and now manage to save and invest a good 80% of what I make instead of blowing it as fast as I can

Funny how people don't realize that spending less is easier than making more.

haha yep exactly. The easiest way to make more money is to spend less.

[Angry Jew Cat - Banned for Life]

ya, no secret that i'd be making a lot more money if i quite spending all my monies on booze and whores... i eat out every night, buy new electronics far more often than i need to. i just have zero fucking money management skills. i need to date a sexy accountant girly who'll whip my finances into shape for me...

[EscortBiz]

Originally Posted by Shap

A great example of how smart money management can lead to huge success is one of the biggest (if not the biggest) affiliate programs and companies around today. Without naming them (because who they are doesn't matter) this company started with almost no money and started by submitting galleries to tgps. They took that money re-invested 100% of it. They expanded their gallery operations and decided to build free sites to control the traffic themselves. That worked, they re-invested 100% again and decided to control the paysites they send the traffic to. That worked and they continued to re-invest almost 100% of what they made and built themselves into one of the biggest most impressive companies in our industry today. All with almost no money to start. Not to mention these guys came into the market almost 5 years after most of us. These guys are at the top of the industry and they don't drive bentley's or ferrari's or live in $15 million mansions. They could but they don't.

they also robbed so many surfers abused peoples credit cards (most will never buy a membership again) and then robbed peoples content too for their next venture

they started very good very impressive but their ending is a different story

[V_RocKs]

I definitely look back and go... WTF?

I am just barely now starting to use the method described above where I pay myself a set amount.

[stever]

Originally Posted by EscortBiz

they also robbed so many surfers abused peoples credit cards (most will never buy a membership again) and then robbed peoples content too for their next venture

they started very good very impressive but their ending is a different story

he was referring to another company not the one you might be thinking of

[stever]

money, clothes, hoes!
all a brotha knows

[Spunky]

I'll just cut back to Hookers and reefer

[Shap]

Originally Posted by EscortBiz

they also robbed so many surfers abused peoples credit cards (most will never buy a membership again) and then robbed peoples content too for their next venture

they started very good very impressive but their ending is a different story

We must be talking about a different company. Because the one I'm talking about did not do that.