My golden rule for IM: Never spend more than half of what you have made so far

16 replies
This has been my policy since I started in IM a couple months ago and it has served me well. It helps me avoid buying every pretty website I see on Flippa and every WSO I see here with good reviews.

I keep track of how much money I have made by doing things online, and never spend more than half of what I have made so far. This method has been great for me, so I thought I'd share some of the nuances with you guys!

But wait, how do you get started by spending $0?

I started on Fiverr. After doing about 10 Fiverr jobs (editing papers, photoshopping, etc.) I had earned $40. I then used half of that money to pay for my first domain and hosting - and the other half I kept!

During this time on Fiverr, I browsed WF a lot and learned more about what to do once I actually had earned enough money to start making IM-related purchases without breaking my golden rule.

How do you keep track of money?

I just keep a spreadsheet in Excel. I have one column for expenditures and one for revenues. At the bottom I have the sum of all my expenditures/revenues so far. If my next purchase is going to make my total expenditures go over half of my total revenues, I don't make that purchase. It's pretty straightforward, and even if you don't update it every day, you can use your PayPal/Credit Card history to bring it up to date whenever you want to make a purchase.

What about when you find something great and really worth buying?

Most of the time, even if it seems like it can't, it can wait. Is it a WSO, eBook, or similar? Bookmark it and come back to it when you have the money. Who knows, you might not even want it anymore at that time. I have multiple WSOs bookmarked in my browser to come back to when I have made enough money to afford them without breaking my golden rule.

If it's something that is time-sensitive, like a website on Flippa or something, I usually just let it slide. There will be other good websites for sale. If this one is BestKeywordEver.com for $5, then sure, go for it. But if you have any doubts that it will make you all your money back quickly, let it slide until you can afford it without breaking my golden rule.

But I'm a newbie, don't I need to be paying for advice from those guru guys?

Honestly, I have gotten way more (and better!) advice from Warriors right here in this forum than I have from "gurus". Browse around, ask your questions here, and learn the basics before getting started - then when you do encounter "gurus" you will be better equipped to tell if their products/services will actually benefit you.

Take all this advice as you will.. as I said, it has served me well! It is an easy way to manage your funds for IM and make sure you don't go overboard with your purchases. It also helps you focus on one or two sites in the beginning (because you can't "afford" more), which is great because many newbies have problems with spreading themselves too thin.
#golden #half #made #rule #spend
  • Profile picture of the author HostWind
    This is a rule to live by So many people get excited by all the tools out there and they think "If I only had that tool I would be rich and successful, then their Internet Marketing turns into a hobby instead of a business
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  • Profile picture of the author John Romaine
    Dude, care to share your spreadsheet?
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  • Profile picture of the author mandark
    I'm not comfortable sharing my real spreadsheet (it has some sensitive financial information) but I am happy to provide a template!

    I uploaded a basic version to my site: www.grammarcrusader.com/expensesheet_WF.xlsx (when you visit this, it will immediately start the download of the excel spreadsheet. If you don't want to download it, don't click this link )

    Basically you put revenue items on the left and expenses on the right, and if the bottom right number is green, you're staying within the golden rule! It turns red once the sum of the expenses is more than half the sum of the revenues. Feel free to play around with it.
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  • Profile picture of the author BridgetSielicki
    This is a great post! I wish I had followed this rule when I had started! It definitely helps to have some sort of rule / system for yourself otherwise it is just so easy to spend money for products that you don't need.
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  • Profile picture of the author BenoitT
    Your idea is awesome dude. This is a real lesson on budgeting. Put how much money (or % of income) you want to spend on advertising, buying products, buying articles, ... is a way more healthy way to do it.
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    Benoit Tremblay

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  • Profile picture of the author John Romaine
    You got this in a standard xls format???
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  • Profile picture of the author social saint
    Yes that's definitely a great rule to multiply your income and profit. What matters more is where and how you invest the "50%" money.
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    • Profile picture of the author colie3188
      That would be awesome if you could share! thanks man
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  • Profile picture of the author BenoitT
    Here is the .xls version: http://www.keywords-sniper.com/expensesheet_WF.xls

    All the credit still goes to mandark. Everything is in the mindset and that one is a must for any entrepreneur.
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    Benoit Tremblay

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  • Profile picture of the author wulaishiwo
    It seems great. But the difficult thing for me is where to find a free or cheap but worthy starting point like yours. Internet money ads flood over many sites. I can hardly trust one to devote myself in. As we are always being told, there is no such thing as FREE.
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  • Profile picture of the author Andrea Wilson
    It is a nice rule to implement in order not to be penniless in the end of the day. Its more of becoming a responsible person, with the golden rule in mind you will be sure that you are really more on profits.

    Andrea
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  • Profile picture of the author pappyy3
    Excellent Post & Commonsense advice - Thankyou
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    Tonster

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  • Profile picture of the author jazbo
    Good common sense. I read too many people on here advocating you invest everything all the time until you have upscaled to the point where you have "made it". I wonder how many ever do using a 100% reinvestment model.
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  • Profile picture of the author mandark
    It seems great. But the difficult thing for me is where to find a free or cheap but worthy starting point like yours. Internet money ads flood over many sites. I can hardly trust one to devote myself in. As we are always being told, there is no such thing as FREE.
    There is no such thing as truly free (anyone with even an elementary study of economics can back me up on that!), but there are always tasks (typically in the freelance domain) which cost only your time and effort, two things you should have in abundance when starting off in IM!

    It is a nice rule to implement in order not to be penniless in the end of the day. Its more of becoming a responsible person, with the golden rule in mind you will be sure that you are really more on profits.
    This is very true. This is just another easy way to promote fiscal responsibility.. you don't have to keep to the golden rule to the dollar if you don't want to, but it's a good thing to help you keep your head out of the clouds in terms of your IM spending.
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  • Profile picture of the author Steve Faber
    Analyze every capital outlay in terms of ROI. If I spend money on this, will I get a positive return on the investment? If so, what is the timeline for that return? That is how "real" businesses look at capital expenditures, and if you're really looking to have a real business it is how you should also.

    It is so easy to get caught up in all the hype and just spend, spend, spend. I typically only buy products if they address a specific need, and no, "making more money right now" doesn't count. If I need information on a specific technique, tactic or procedure, then I'll look at what is out there that addresses it and has great feedback. I try to stay away from the general stuff. It helps cut back on wasted time and other resources. Remember, not only are you spending money on everything you buy, if you're to get anything out of it, you also have to read, watch, or listen to it (sometimes all of the above). If you can't commit to that too, you've wasted your money.
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  • Profile picture of the author PVReymond
    It is a great post...

    Getting started with $0 is not easy so you have to offer
    some kind of service, as you said, to make some money and
    then reinvest it.

    Reinvesting half of your profit is not a bad idea.
    Personally I like to reinvest 80% of my profit this way I
    can grow faster.

    You should buy just what you need right now and don't waste
    time, money and effort in things you are not going to use...

    It is true that there are lot of great tools and courses out
    there but, if you can't use them immediately why should you
    buy them?

    Thanks,
    ^PV Reymond
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