What Do You Spend Your Money On?

December 5, 2008 Posted by Tyler Cruz

A few days ago, a commenter left a question on one of my posts asking what I spend my money on. I thought it was a good question, especially since my income has seen a nice little increase during the past couple months.

While it would be fun to say that I spend it on expensive cars, Rolex’s, and other forms of bling, the truth is that the number one thing I spend my money is on is taxes. I’m a very honest and by-the-book person and therefore declare every penny I earn online. Since my income is high enough to be in the highest income tax brackets, I’m penalized with the highest tax rates. This eats up a lot of my income (nearly half) right off the bat.

When you start to earn more, the IRS or the CRA (Canadian Revenue Agency) in my case, will start wanting you to pay quarterly… in ADVANCE. They do this by basing your estimated tax income for the current year on how much you paid last year. So, I actually have to pay income tax before I even claim the money (or even receive anything!).

1. Income Tax

So, as anti-climatic as it sounds, the #1 thing my money goes towards to is income tax.

2. Mortgage & Strata

I bought a brand new condo in 2007 for $214,500 (+6% GST since it was brand new) and took an accelerated bi-weekly mortgage on it. The mortgage includes insurance and property taxes and works out to around $1,300 a month.

Now that I’m starting to make more, I’ll probably be putting some lump payments to pay off the principal (since mortgages are always interest-heavy).

In addition to my DSCR mortgage, I have to pay a strata fee since I live in a condo. That’s another $215 a month which is quite pricey. It’s fairly high because I have underground secure heated parking, a recreation room, and just generally a nice building which in turn has a higher strata cost.

Electricity is only about $25/month.

3. Hosting & Investment into My Sites

I don’t want to really mix up my corporation and personal income, but since I’m the sole shareholder of the company I thought it would make sense to mention this.

With Merendi Networks Inc., I pay hosting costs each month which is around $450-$500, and invest a lot of money into new projects such as a new one I’m working on right now when I expect to put $5,000 to $6,000 into the development of.

Then there’s license purchases such as vBulletin, domain renewing, logos/design upgrades for existing sites, etc. In fact, this might be #2 instead of #3.

I like to reinvest what I earn back into my work. It only makes sense to me and I’m never scared to spend money on things that could make me more money.

4. Necessities

I spend a fair bit on food. I love food (which you may have noticed from my growing belly) and always buy name brands and the more expensive items such as sandwiches from the deli.

I also order in on occasion and pick up food (there’s a fantastic Vietnamese Pho restaurant just a few blocks away that I always get the #36 and #36 at) and eat out at restaurants with Lisa. We used to eat out at nice restaurants a TON last year, but really cut down this year which is good. I think last year there was a point in which we were eating out at restaurants almost every second day…

In addition to food there’s medical care (who said healthcare in Canada was free?!), dentist, optometrist (contacts ain’t cheap), car insurance, gas, cable TV, cable Internet, electricity and my cell bill.

One area where it can be tempting to skimp on expenses is dental care, but that can be a mistake in the long run. Neglecting dental health can lead to costly procedures down the road, not to mention the discomfort that comes with dental problems. That’s why it’s important to find a dentist who offers affordable and quality care. One option could be Dental Made Easy Little Caribbean, which offers a variety of services at reasonable prices. By prioritizing dental care now, it can save you money and headaches in the future.

This stuff really adds up. You can easily overpay on your electricity bill if you don’t choose an electric utility provider that offers low cost electricity rates Calgary.

5. The Fun Stuff

Finally, the fun stuff. I bet some of you were expecting this to be much higher on the list, but the truth is that on average it’s much lower and usually makes up the least amount of spend distribution.

I used to play a lot more poker than I do now, and earlier this year played a lot of high-limit private home games – some of which were $500-$1,000 buy-in’s. And I used to play online a ton as well, but now I play very little poker, playing maybe 2 days a month on average. I used to play for the money, but now play more for the fun. The thing with poker, apart from the wild swings and deviation, is that it takes SO much time. You have to grind out playing hours upon hours upon hours. I can make a lot more by working on Merendi Networks Inc. which is the main reason I stopped playing and i switched to a trusted gambling site called Super88bet.

I’ll go on the occasional trip, but don’t go on all that many. This year Lisa and I went to the River Rock Casino Resort and then to Las Vegas in September for BlogWorld. Next summer I’ll be going to the Philippines and I expect that to be a bit expensive (the plane ride isn’t cheap).

As for toys, I don’t go too wild but when I get something I usually get something nice. I just bought a beast of a new computer a little while ago as well as two 24-inch monitors. Then, even more recently, I bought a nice new bed. I’m now eyeing a 60-inch HDTV/Plasma for my living room and a 40-inch wall-mounted HDTV for my bedroom.



I’ve also been looking at upgrading my Blackberry Pearl. I’m waiting for the Blackberry Storm to come to Canada and might consider switching over then.

Lastly, I spend money on online games from njnodeposit.com and DVD rentals. I have a Wii (traded in my XBox360) but don’t play it anymore although I’m considering getting Rock Band II when it comes out, but primarily play PC games. I actually don’t spend a whole lot on games because I get a scary amount of gameplay time out of them. I still play Starcraft which is nearly 11 year old now.

Nothing Fancy

So that’s what I spend my money on. It’s nothing too fancy, and I still have a mortgage to pay.

However, I expect 2009’s income continue to climb just as well as each year did before. For example, even if we’re conservative and assume that 2009 averages what this month of December will most likely bring in, we would expect for Merendi Networks Inc. to bring in $180,000 since it’s currently doing around $15,000/month.

So, what do YOU spend the money you make online on? Whether you make $40, $400, or $4,000 a month you must spend it on something. Do you save it? Reinvest it online? Put it in the bank and save it? Pay the bills? Or do you buy all the bling you can get your hands on?

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Posted: December 5th, 2008 under Miscellaneous  

47 Responses to “What Do You Spend Your Money On?”

  1. Ryan McLean says:

    I spend my money on rent firstly. Internet connection and blog hosting fees.
    Then I love to spend my money upgrading my blog. About to get a custom theme for my blog which should see me through the next year or two at least.
    Love to spend my money on food…and alcohol…hehe
    Thats about all

  2. Monetize Pro says:

    Most of my money goes to girls and beer

  3. shy blogger says:

    My internet money just can go to pay bill..
    I’ve not earn much money…

  4. CD8137 “The Tortoise” says:

    I just save my money in the bank. I’ll probably spend it when I get older on a house, etc. I’d rather have a large down payment, rather than paying a mortgage for 30 years.

  5. All the money I make online alternates from paying off bills and debt to being put back into my blog.

    I think it’s funny when alot of people think bloggers that are making money online spend it only on fun things.

    It’s those that invest in themselves that will be successful in the end.

  6. browie says:

    Down payment blah… I’m on my 2nd house before the age of 30. We have more money in the bank than ever because we bought early not worrying about a DP and sold our house for more than what we had it. Use that for DP on our 2nd house and keep the rest.

    I think if you wait and wait for $$ for a down pay then you’re wasting time. Remember, if you are trying to save for something, retirement or whatever, you should have started yesterday.

    I don’t make that much online to do the whole what do I spend it on. I bought myself some diamond earrings when i hit a mark and that’s about it. Now I’m just putting it all back into more profits

  7. Paul B says:

    We only pay a top rate of 18% income tax, nothing on the first £9000, 10% up to £19000 and the 18% above that. I make a nice wedge online and once all the bills are paid (12 years down the line we only have a tiny mortgage) the rest gets invested into my sites, put in the bank to earn interest (which isn’t so good these days) or blown on the good stuff.

    At least one LCD TV in each room, a couple of x-boxes, PS3s, Wii’s. A have a couple of laptops lying around the house in case I get any brain farts. Desktop PC’s in 3 rooms. Robot hoovers, clever clother driers, e-book readers, basically anything gadgety I’ll buy. I love tech.

    Of course every now and then I’ll go and have a day on the booze with my mates which can cost a fortune!

    That’s pretty much it, probably 80% of my money goes on either making me more money or the good stuff in life. If I was John Chow I’d probably be talking about the Dot Com lifestyle about now 😉

  8. Chris M says:

    Good on you Tyler, I would say that we’re very alike in terms of our earnings and spendings, and as much as people think our blogs scream ferrari, it’s not really the case.

    Let’s hope that one day it will be 🙂

  9. Blog Expert says:

    I spend money on anything I need. I travel quite a bit so I don’t not have a longtime at home. So I guess you can say I spent most than money on trips. That is why I love being a full-time blogger.

  10. acai diet says:

    Pay off debt every month 🙁

  11. starbort says:

    Seriously…what a complete yawn of a post. We ALL have living expenses. There’s nothing even remotely interesting or unique in this waste of a post.

  12. If I was making $15,000/month then I’d probably buy every single PC game I could get my hands on!

  13. Walt says:

    I might reconsider the Blackberry Storm if I were you: http://blog.wired.com/gadgets/2008/12/the-votes-are-i.html

  14. […] next year? Tyler Cruz offers us a glimpse into the world of an Internet professional, describing where he spends his money. Seeing how we live in Canada, it really shouldn’t be all that surprising that the biggest […]

  15. BusinessX says:

    Nice to see I have plenty of company when I say living expenses. Try to put more into business, but life has been eating it up of late.

  16. My wife and I have no money and we’re in a slight debt, but it doesn’t stop us from purchasing and dining at the best restaurants in our area. We love food and taking care of your health is much better than saving money.


    p.s. We dine more at home, but with expensive food.

  17. zemg says:

    I write off almost everything. EVERYTHING. My cars (Benz and G35), partial mortgage, computer supply, advertising & development cost, out to eat (as business meetings), EVERYTHING.
    oh yea, I’m 19.

  18. Hussein says:

    Wow. You’ll be going here in the Philippines. I am from the Philippines. 🙂 Hope to see you. What will you do here? Hop you enjoy in our country.

  19. randy bragg says:

    You can write off a house you rent as well….

  20. skiper says:

    to pay my bills like Internet connection, blog hosting fees, some gadgets, going forward I’ll reinvest what I earn back into my work like site redesign.

    Hope to see you here in the Philippines, do we have EB here =)

  21. David Risley says:

    Well done, Tyler. I make pretty close to the same amount of money you do online, and it is easy to assume from the outside that that means we’re floating on cash. Well, not really. My mortgage is $1,600/mo. I have one employee who likes his paycheck. I pay around $700/mo on hosting. I recently picked up a new car and, while I got a fantastic deal on it, I do have a monthly payment on it. I can still afford some bling (I jut purchased a 50″ plasma TV yesterday), but still, my money goes out almost as fast as it comes in.

    Oh, did I mention I have a kid, too? Yeah, like I said. 🙂

  22. Most of the extra money I make goes directly back into advertising. I leverage the traffic I already get with Google Adwords. It doesn’t exactly double the sales I am getting through organic traffic but there are days it gets close. So as I write more content, get more sales and track all of my keywords, I take the money and bid on those keywords to hold my position in the search engines as others may start ranking higher than me with their natural listings.

  23. Problogineer says:

    I spend a lot on taxes too..
    Nice computer there 😀

  24. wisdom says:

    I would say food and healthcare.

  25. arnold says:

    “Next summer I’ll be going to the Philippines and I expect that to be a bit expensive (the plane ride isn’t cheap).”

    Really? Inform me when you are arriving, we could a rrange a meet-up with Filipino bloggers if you are interested. =)

    As for me, I have a separate income for my day job which practically pays the bill. For my blogging income, I usually save it up until I’ve got enough to splurge on a gizmo I want. In fact, I’m hoping to finally get a MacBook in a few days from now. =)

  26. Mike Collins says:

    Bills, bills, bills…but I reinvest as much as possible back into my business to help it grow faster.

  27. Most of my money goes to rent right now since it’s pretty expensive. Other than that, I have plenty of bills to pay!

  28. […] What Do You Spend Your Money On? – Tyler Cruz […]

  29. ; ) I see you pretty real estate savvy too. Bi-monthly mortgage payments. Most people don’t have a clue about this. Smart. That computer set up looks sweet too.

  30. […] What Do You Spend Your Money On? – Tyler tells his readers what he spends all his hard earning money on. […]

  31. Amanda says:

    Hi Tyler – quick question for you, from a Montrealer. :). Do you have any links to good info on taxes and making money online in Canada? I want to make sure I’m above the board in terms of declaring everything I earn online, but in the past have had a hard time knowing how to refer to that type of income, etc.

    • Tyler Cruz says:

      The best way it to simply hire a tax accountant. It’s not very expensive for personal tax (like $80-$100) and you’ll have the comfort of knowing a professional did it correctly and legitimately for you.

      All you have to do is give them all your paperwork and receipts and they’ll do the rest.

      • Amanda says:

        Thanks Tyler 🙂

        I think I assumed that your average accountant wouldn’t know how to handle affiliate income, etc. on a return, but I guess that’s what they’re trained for!

        • Tyler Cruz says:

          I’ll admit, most don’t really know how to do it, but I always figure that they know much better than me.

          Really though it’s not all that complicated. Basically whatever money you make (reglardless of the source) you have to declare… and pay on in most cases.

  32. […] last weekend, I saw a post by Tyler Cruz where he talked about where his money goes. Like myself, Tyler makes his money online and his blog […]

  33. Blogangry says:

    You got to treat yourself sometimes.

  34. SEO blog says:

    I spent most on buying things over the internet, rapidshares, softwaress, scripts, ebooks, accounts etc.

  35. I have always felt that the corporate tax rate in the US and Canada has been too high.

    It’s not always politically acceptable (when most American’s think of corporations they think of the huge, multinational ones) but I think we should move to lower corporate tax rates similar to Europe I think Ireland’s corporate tax is around 12% right now).

  36. Is that pic for real? You have a 80’s TV ?

  37. Wow man…taht’s a great breakdown. It makes you much more personable as a blogger. For the 2cents I make online, I end up just paying hosting fees and saving the rest. It’s only recently that I’ve been able to accumulate a little (talking about hundreds not thousands) and am looking for other investment opportunities, such as affiliate marketing.

  38. Oh yea…I’m also a big fan of starcraft. But I’ve lost the disc a while ago and haven’t been able to play it…though with the whole 4/5 underwater internet cables being sliced open, I’m not sure how many people are able to get onto those servers these days.

  39. All my blog earnings are being put back into the blog right now to help it grow.

    Meanwhile if I was making coin like you, I’d upgrade the bedside TV 😛

  40. lisa says:

    At least one LCD TV in each room, a couple of x-boxes, PS3s, Wii’s. A have a couple of laptops lying around the house in case I get any brain farts. Desktop PC’s in 3 rooms. Robot hoovers, clever clother driers, e-book readers, basically anything gadgety I’ll buy. I love tech.


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