It's Time to Think About Income

I was reading a post recently, where a blogger was telling the world not to monetise their blogs or sites from the very start.  Instead, he suggested, take the time to build an audience first and then worry about that later.

It sounds like smart advice?

You've got to make a decision right here and now - am I creating a blog just as a personal diary. Or am I looking to build an income?

What are the exact steps I'm going to take to build my income.

If you're building an income, you simply can't ignore the fact that you will actually need to make money (sounds obvious huh!).  You can close your eyes and bury your head in the sand or you can act like a real entrepreneur and figure out a way to make money.

Money Isn't a Dirty Word

For some strange reason, it seems "money" is a dirty word among bloggers.

Unfortunately (or fortunately, depending on your outlook), money is an essential part of lifestyle design.

If you want to succeed, you need to have a plan.  Building a blog, posting everyday and trying to build an audience isn't a plan.  What is the end goal?

A monetart goal is a solid and sensible approach to lifestyle design.  Why?  A feedburner count of 5000 is useless unless you're using it.  Where as  a income of $5000 a month is very useful.  What would you rather aim to achieve; an income or subscribers.  I think setting an RSS goal without concerning yourself with how you plan on living is a bit of a cop out.

Target Monthly Income

Tim Ferriss popularised the idea of setting up a TMI or Target Monthly Income.  I've been using this method for a couple of years.  Setting up a TMI is as simple as figuring out how much money is required to live your "dream" lifestyle.

Once you figure out how much you need to make, all thats left to do, is come up with ways to reach that target.

Break it Down

How many info products do you need to sell in a month to make your TMI?  How many adverts will you need to sell?  How many affiliate sales do I need to make?

I find the easiest way to keep track of this is using a spreadsheet.  Evey sale I make, every dollar I spend is currently accounted for.  Im not saying you need to be as anal as me when i comes to recording income, but only having a vauge idea is useless.

When you break down your income, the path to the end goal suddenly becomes clearer.

Hustle

Nearing the end of the month, I often get a much need wakeup call when I see my TMI is off.  I realise I've been slacking off a bit.

Knowing exactly what state your business is in, allows you to get down and hustle.

I haven't buried my head in the sand, I'm well aware of the situation and can respond appropriately.

Now comes the time to hustle.  Put out an extra blog post, push the info products, set up a promotion, write some guest posts.

Listen to the Right People

If you want some great advice, go out and grab a copy of Getting Real.   Although the book is skewed towards building an app, the advice on when to monetise and how to go about can apply to so many businesses.  I used it in my startup (profitable) and it comes from the guys behind the uber successful 37siganls.

Coming up with a TMI is relatively simple.  I find it involves two steps:

1) Work out exactly how much money your "dream lifestyle" Costs

What do you want to do?  Where do you want to live?  What goals do you want to achieve.  If you're stuck answering these questions, the exercises in The Four Hour Workweek will help.

The trick with this process is to be specific.  Work out accommodation,  food, utilities, entertainment and even gadget costs.  A quick search for "average expat living expenses [insert dream destination here]" will throw up plenty of results and guides to living costs.  This step will involve research, but its well worth the effort.

2) Transfer the Goal into a Spreadsheet

I find a spreadsheet is the ideal way to keep track of income I've earned and how far off of my TMI I am.

Download the Sample Target Monthly Income Spreadsheet

This spreadsheet is a very rough and simple example.  Use it as a starting point for your own tracking efforts.

Photo by - Vanessa Pike-Russell

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