In my affiliate marketing income report from a few days ago, I touched on the fact that despite my recent success in affiliate marketing, that I actually live a very middle-class lifestyle.
In fact, I would argue that I may even currently live slightly below the average middle-class lifestyle.
This may seem a bit odd. After all, I profited over $40,000 in May, and my monthly average from the past 5-months is $32,500. It’s slightly higher when you factor in my other income sources and not just my affiliate marketing campaigns.
That means that I’m on pace, based on the past 5-months of income, to net at least $390,000 in 2013. But if you came over to visit right now, you’d never know it.
My Luxury Car
Which of the following cars do you think I own?:
- 2012 Infiniti G37
- 2013 Acura TL
- 2011 Audi A4
- 2010 Lexus ES 350
If you answered any of the above you’d be wrong, because I actually drive a 2004 Toyota Corolla CE. Talk about true baller status, amirite?
Clothes & Bling
I buy $9 T-shirts and $35 shoes from Wal-Mart, and I don’t wear a watch anymore because it broke and I just use my phone now. The watch I did used to wear was a cheap $30 Timex watch.
You should come over and check out my 4,000 square foot house. Its 6 bedrooms/4 bathrooms and has a pool with a slide.
Oh wait, I still live in the same 2-bedroom condo I bought back in 2007.
Vacations Left and Right
Thailand, Bahamas, Mexico, Japan… what do these places have in common? Oh, they’re all places I haven’t been to yet (but would like to).
In fact, that last trip I went on was to Orlando, Florida back in 2011, when I met up with PeerFly and AmpedMedia.
That was before I decided to give affiliate marketing another shot again. That means that I haven’t gone on a single vacation since I’ve been focusing primarily on affiliate marketing.
While I’m currently making a lot more than the average middle-class 29-year-old male, my lifestyle doesn’t reflect it.
Everywhere I look, it seems that everyone is driving a new (or newish) car, or at least a much better make and model than what I drive. It also seems that people are going on vacation or taking a trip at least once a year.
It kind of bugs me sometimes, because I’m working hard and trying to be responsible with my money, and then I see others getting new cars and going to Hawaii for a week while my weekend plans are to work.
But that’s not really the whole picture. Behind the scenes, there’s a very different story being told.
The truth is that most people with new cars don’t actually own their cars. They’re leasing them or are on some long-term financial plan for 84 months (7 years).
They struggle to meet their car payments each month because they couldn’t really afford it in the first place, but that doesn’t stop them from buying a new pair of designer jeans, which they can’t really afford either.
They don’t own a home or even an apartment. They’re renting, and even then they’re only 2 paychecks away from not being able to pay their landlord.
They do go on vacation, but usually only stay for a few days, and rush everything and stay at the cheapest motel they can find. They can’t stay too long because they need to make their car payment.
Oh, and I almost forgot. They just bought a brand new 55-inch TV. That’s on credit. In fact, they’re $6,000 in debt spread across 2 credit cards. The same credit cards that the vacation was paid with.
I am a firm believer in delayed gratification. That is, only spending money on luxury items (cars, vacations, etc.) when you can afford to do so.
The average person does not practice this. This is why the average person is in debt.
While I am not living in luxury at the moment, my plan is to work and be reasonable with my money now so that I can reap the rewards and benefits later.
The middle-class will stay in the middle-class, as long as they don’t get laid off or fired, and even so, their debt will eventually catch up to them and they will have to cut back.
Meanwhile, one day, hopefully, my hard work and sensible spending will have paid off and I’ll jump to the 1% and live in luxury while everyone else will whine and complain how life isn’t fair.
I don’t make $40,000 a month. I make a middle-class wage. My corporation makes $40,000 a month.
From 2011 through to March 2013, I was paying myself a salary of $2,847.03 net a month. That’s only $34,164.36 a year.
In March and April, I increased that to $3,395 since I saw a big jump in my income throughout the year which proved to be consistent.
Then, my latest payroll sent to me on June 1st, 2013, was increased again to $3,853.35. That means that I increased my salary by $1,000/month since February 2013.
This is my "reward" for continuing to bring in high numbers, and actually increase my corporate earnings.
I will not be increasing my salary again anytime soon though, even if my affiliate campaigns skyrocket. If I manage to net an average of over $40K/month over the next 6 months or so, then I’ll probably reward myself with another increase, but until then I’m going to sit tight on my extra $1,000 a month.
Since I’ve been living off of $2,847/month for around 2 years or so now, the extra $1,000/month is actually a dramatic increase for me.
Roller Coaster Industry
Affiliate marketing is such a volatile industry that you can be making $300,000/month profit one month, and literally $0 the next.
Offers can go down, traffic sources can ban you, and competition can change at the blink of an eye.
That is why it is so important to scale things up and make as much as you can as fast as you can.
It’s also why I am being so frugal with my money. My campaigns have been doing well lately – so well that I could be buying a brand new car every month if I wanted to. But that would be incredibly irresponsible.
Since I’ve sold off a lot of my website portfolio, especially my largest money maker, my income now comes primarily from affiliate marketing. It’s my bread and butter currently. It takes a lot of time, effort, and MONEY to find a winning campaign, and so I need to make sure I have enough money in the bank that will let me stay afloat should all my campaigns die tomorrow.
As it is now, all my campaigns could die tomorrow leaving me earning $0, and I’d still be able to keep paying myself my current salary for years, and that’s factoring in taxes and everything.
The Rewards Will Come
I won’t be living my current lifestyle forever. In fact, it will be changing soon.
I’ve actually been actively selling my condo for a very long time now, but the condo market here is insanely dead. Once it sells, I’ll be buying a nice house. I’ll be sure to post photos and give you guys a video tour when I get it.
After I have a house and have bought some new furniture and all the stuff that goes along with upgrading from a condo to a house (lawn/gardening equipment, for example), my next toy will be a new car.
I don’t plan for anything too fancy though, as I’m definitely not a car guy, so there’s no point in getting anything real special. I just have a car to drive from point A to B. I’m thinking of possibly a 2012 Camry or maybe a 2012 RAV4 if I get a dog or two. You may notice that I said 2012 and not 2013 or 2014 – I’ll never buy a brand new car. Don’t feel like losing 11%+ of the value once I drive it off the lot (check out these (car depreciation reports).
I’ll be paying for it all in cash too – no finance plan for me.
And once I’m settled in my house, the vacations will come. My house mortgage will be my only debt, so it’s important I put as much down as I can.
I Need To Get to the Next Level
So there you have it. This is why I keep talking about how I need to up my game and get to the next level.
I’ve been working hard and have been fairly responsible with my money, so I want to enjoy some of the fruits of my labours soon.
Hopefully I can continue to increase my revenue so that I can do exactly that.