Automating Passive Income

In The Passive-preneure I talk a lot about automation, and you’d know that if you’d picked up your extremely inexpensive copy today. One of the ways I’ve gone about automating my own passive income streams is by using one to fund another, automatically. I’ve discussed ShareBuilder in the past, and how I utilize their automatic investing options to “set and forget” my investing plan. Well, I also utilize their direct deposit option to help this along.

In my Kindle Direct account I have directed all income to my ShareBuilder account VIA direct deposit. This lets me move all my money into investing, and never have to worry about accidentally spending it. Then, once the threshold is reached my automatic investments kick in. Then I’m able to keep track, and get my dividend reinvestments from these. Thus, one passive income stream (my eBooks) funds another passive income stream (my Dividend investing) which I’m also utilizing to build up the capital to purchase yet another passive income stream (my rental properties).

You can see from this that it’s a domino effect, and if you have multiple streams, such as eBooks and membership fees on a website, for instance, you can direct multiple streams into the same account, and build those streams faster. Turning them from a passive stream, to a passive river.

Pictured: Your income

Pictured: Your income


On Bitcoin



If you follow the world of Bitcoin you probably know that Mt. Gox is gone. For about 4 years they were the name in Bitcoin, and in a spectacular show of incompetence and mismanagement, they lost about $700 million in bitcoins, and closed shop. I’ll be honest, though, I don’t think it’s a bad thing.

For years Mt. Gox has been a blight in the bitcoin world, and I’m not just saying that because they screwed me over, mainly because they didn’t. I’ve never lost a dime because of Mt. Gox, in fact I bought $10 worth of Bitcoin in 2011, and by early 2013 the price had jumped so that $10 was worth $100. I sold, and withdrew all of my cash from Mt. Gox right before they had so many issues and had to shut down US withdrawals.

I do still own bitcoin, about $3 worth–I know, it’s amazing, right? I didn’t spend anything for these, I built tools to help Peerbet gamblers play, and for a 1% fee of their winnings they could use it. It worked, and I ended up with almost $500 worth of bitcoins…which I promptly gambled away, because fuck it yes I did. They were free, and the system took me a night to put together. I like to gamble, but I’m not stupid. I’ll gamble with free money any day of the week, but if I have to invest my cold hard cash, I’m being responsible about it.

But this is more of a rant than anything, I’m not even sure what I wanted to accomplish with this post, if I’m being honest. There has been some questions since Mt. Gox went down as to the capabilities of Bitcoins to ever be a “real” currency. I have some concerns with this idea, and it all goes back to infrastructure.

I love bitcoin. I love the idea of unregulated currency, and market rate pricing. I love the idea of it. I do not currently trust it. If Fallout 3 taught us anything, it’s that even bottle caps can be considered currency. But they can also be considered bottle caps. Currency is only a promise of value, and if what you’re using is considered to have value, you’re good. It’s bartering, only we’re bartering notes that have a promise of value to them.

But Bitcoins can’t promise that, because they don’t have the infrastructure. Bitcoins still rely on the banks of the world to convert their money from Bitcoins to actual currency. It’s for this reason that Bitcoins have such a hard time. They want to call themselves a currency, but don’t want to be regulated like a currency. It scares the banks. It scares the governments. It lowers the value.

Or it should.

But people are insane, and the value of Bitcoin has become hyper inflated as of late, and as such is not a good investment. The fact that there are a limited amount of Bitcoins sounds like a good idea, it really does. But if you really think about it, is it really a good idea?

How many times have you had a computer crash with a bitcoin wallet on it? Those bitcoins are gone. Forever. If you can’t recover the wallet file, you can’t recover the bitcoins. Think about that. There are a limited number of coins, once they’re minted, they’re minted, no more.

I’m not saying all eCurrencies are a bad idea, but I think there are things about Bitcoin that on the surface appear to be good ideas, but after a quick brush away of the veneer, you realize that they’re rookie mistakes. I’m still interested in seeing the future of eCurrencies, but I doubt that it will be Bitcoin.

The Passive-preneure Released

The Passive-preneur

The Passive-preneur

The Passive-preneure was released today, and will soon be available world wide (only in English) on Kindle. It’s priced at $2.99, and is easily worth every penny. We’ve discussed what it is in the past, but basically it’s an indepth look at passive income, and how to make a living using it. It’s no-nonsense, and no bullshit, you’re not going to “get rich quick” or “make millions online in just 6 short weeks” because those are called scams, and they don’t work.

No, what The Passive-preneure does is teach you the true, sustainable, methods of making money both on and off line, in a passive way. It shows you some methods, and gives you an idea of how risky or difficult they are to setup. If you’ve ever considered making money passively, you need this book. So go, now, go buy it. I’ll wait.

Pick Up Your Copy of The Passive-preneure on Amazon right now!

Getting Serious About Credit

For the longest time I haven’t cared about my credit. This is stupid, a very stupid mistake, that I have made. Not that my credit is irreparable, it’s simply bad. What happened was simple. I moved out on my own as soon as possible, at 18 years old. I had no practical experience handling my own finances, and didn’t know how to save money. Worse yet, I didn’t know how to keep up on bills. So, I defaulted to just not paying anything. As you can imagine, this became bad really quickly. I became very far in debt, and I am still digging myself out of that a little at a time.

But it’s time to get serious.

Here I am nearly 10 years older, a wife, 2 kids, and dreams of owning my own home one day. Initially I had hoped to pay for that home with cash. And if I wanted to wait another 10 years to buy a house, I probably could. Thing is, I don’t want to wait. Neither does my wife. Nor my children.

So over the course of the next year I’m getting extremely serious about paying off all of my debts, including both my wife and I’s student loans, totaling approximately $78,000 on their own. Can we pay them all off in a year? No. But we can get the rest of our debts paid off, and get current on student loans, and hopefully improve our credit scores to the level that we can get a mortgage, thus saving ourselves even more money per month which we can devote towards our student loans.

It’s time to start focusing on the future.

This year we’re set to receive approximately $8,500 in tax returns. A large portion of this will be used to completely pay down my wife’s credit card, as well as my own, which we will then strategically use to transfer past due debts to current debts. The trick is to not transfer too much at once, and pay it off quickly. This way we can improve our credit by maintaining a good standing with our credit card company, while at the same time removing previous debts from our history. It’s my assumption that we can not only pay off all of our past due debts within the next year, but by doing so this way we can begin down the path towards credit score recovery.

Another part of the process is going to be growing my investments. As you’ve seen from my previous pasts, my portfolio is not that large. I plan to use this tax return to increase my holdings ten-fold, all with my dividend investing plans for 3 months to profit. The plan for my stock portfolio at this point is to develop it into the down payment for our mortgage. Allowing the dividends to work for us, and collect gradually while we improve our credit, so once our credit is to the level that we can potentially get the approval, we’ll have the down payment ready to go.

Obviously this is the start down a path which I have not yet completed. I bring it here so you can see how I do, and see if this strategy works for me, or maybe even if it doesn’t, it might work for you. I’m not an expert–if I was, I wouldn’t be so far in debt–I just have been forced to teach myself ground-up the financial world, and enjoy spreading my self-learned lessons when I can.

If you have any suggestions on how to quickly pay off past due debts without incurring even worse results, leave them in the comments.

State of the Stock – January

So I decided to do a run down of my current situation with my stock portfolio, where I have decided to change how I buy my stocks. Since I made that decision, I have purchased no new stocks outside of the automatic dividend reinvestment. I can already see growth, and potential with this method of investing, in a short period of time.

Some of you may wonder how I get my figures, and I have explained this in the past. In short, I do not consider dividends to have a dollar value, simply because they are free to me, and cost no commission to reinvest, thus they are a zero dollar amount stock share. For this reason, the value of the Average Price Per Share can, and will, creep closer to $0. This allows me to build up a portfolio of solid dividend shares, sell off all of the shares that I have purchased to that point, a piece at a time, and eventually leave myself with a dividend of $0 share stocks.

This is akin to a gambler walking into a casino with a $100 bill, winning at roulette for $500, and then depositing that $100 into his account and playing with the $500. Is it really losing money if you lose it all? Of course, it is. But it hurts much less, because you’re not actually at the negatives, you’re at the break even point.

TEU 65.0221 65.0221 $6.84
BAB 4.0772 4.0772 (-$17.40)
INTC 3.0778 3.0778 $13.24
O 4.9486 1.5408 (-$40.69)

A Change in the Publishing Air

Some of you that know me know I own a small independent publishing company. Those of you that didn’t, now you do. By small I mean small, less than 10 published works, and all from a single author. Myself. That said, I’ve been seeing a change in the air lately. There is a big draw to become indie published, which is exactly why I started the company–so I could be indie, without being indie. I wanted a publisher’s name in the credits, but didn’t want the stress of finding a publisher.

I’ve started considering how I could use this changing paradigm to make profit. With the expansion of print-on-demand, and the increasing quality of such services, not to mention the expansion of eBooks as a competitive reading medium, and the inexpensiveness of eBook production, I really do see us on the precipice of a new age in publishing.

It’s for that reason I’ve started planning out a new publishing contract, one that is weighted in favor of the author, and not the publishing house. Costs can be cut by utilizing freelancers on a project-by-project basis, and maintaining a vastly online presence–all of which I have experience with, and can setup without much effort. As always, I’m looking for no-hassle, passive income, so I’d be hiring a single full-time assistant, an editor who would be able to sift through the submissions for the cream of the crop. We’d then submit those for editing to one of the stable freelance editors, sending back the results to the author.

I’m aiming for the middle ground between Vanity Publisher and Traditional Publisher. I won’t take anything and everything, but I don’t want to have to invest so much work that the financial side of it requires a bigger cut. I’d also be looking for a very non-traditional, free flowing contract. Contracts would focus on works as works, not works as a means of enslaving the author. Authors need to be free. They cannot thrive in a relationship that requires they be leashed to you.

I’m considering this: A high royalty (50%) on earnings until the expenses are paid off, or until 1 year of publication has elapsed (meaning if the book takes 6 months to edit, and is released on June 1st of 2014, June 1st of 2015 the royalty would switch), whichever happens sooner. During that first year all editing, typesetting, and marketing costs would be covered by us, with the author and / or their representative having an equal seat at the discussion table for all of it. Once everything is agreed upon, the publishing will happen. Once the expenses are covered, or a year has elapsed (again, whichever happens sooner), the royalty would then convert to 15%. Again, this is the publisher side. That means that we (the publisher) would sell the book, and if it made $1.00, we would pocket $0.15, the rest going to the author.

Obviously, due to the cost paradigm, the marketing efforts for that work would dry up after the first year. The author would need to cover a larger portion of advertising themselves, etc. And we would not be able to cover major events, such as book signings, but these are all things the author would have the time to focus on.

The important thing is getting a professional book to market, without the hassle of funding it yourself, and if you want someone else to handle all of the decisions and just get to the writing, we could make that happen to.

What do you think of this type of publisher plan? Could it work? Would you use it? Am I crazy for even considering it? Let me know in the comments!

The Capitalist Cares Stock Portfolio

So I decided that, since I talk about it so often, I might as well show you my portfolio. The link I’ll post below is a direct link to the Google Doc that I use for my own stocks. I buy / sell through ShareBuilder, but I found that they don’t figure in sale commission into their own profit calculations, and once you sell it removes the stock from all equations entirely. I didn’t like that. So I started putting together my own system. This system keeps track of all profit / loss, portfolio-wide, and as long as you never delete a sheet, you can track the total profit / loss forever, and use one investment to cover the losses of another, and get an idea of total portfolio value.

Currently you’ll see that my value is in the negatives. This may appear bad for someone who’s sitting here with the hubris to talk about finances, but it’s actually just plain math. I spent money to purchase stock, and in those instances you are starting in the negatives, not at 0. The first step to profit is finding your break even point, the next step is finding the point where you can cash out with shares left over. From there, you can get your risk out, and let the rest build up as much as you want.


One major thing you’ll notice is that I’m heavily invested in only a single stock. That goes against all the advice on diversification, and I’m well aware of that. I have faith in the stock, though. It has a proven track record. I also have a back up plan, which includes BAB and INTC, which you’ll also see in my portfolio. Will I be revisiting TEU? I haven’t decided yet. It’s a very volatile stock, which has quite a bit of risk associated with it, but I can fit it into a 6 months to profit formula fairly cheaply, so I might consider it again.