Thursday, December 30, 2004

Managing Passive Income

Yesterday, I went back over last months "Brain Dump". I made a few additional notes, but overall was pleased that my wants/needs/goals were still the same, and that everything is moving in the right direction. It helped me to confirm the current task list and short-term goals, and was very motivating.

I'm ready to buckle down, streamline, and take things to a new level. I'm locating my "money leaks" and also looking hard at expanding the potential on current streams of income.

One of the first things that I am doing is to pause all of my current PPC (pay-per-click) campaigns on Google Adwords. Admittedly, they need some work and I know that I have a few money leaks there, for sure. For example, one of my favorite merchants changed from a CPA model to a CPS several months ago. What this means is that I no longer get paid "per lead", but now only "per sale" - meaning that a visitor converts to a paid customer.

I went from spending $300 to make over a thousand in a month's time, to spending $300 and barely making ANY commission. It was worth testing - now it's time to dump it. I paused ALL of my Campaigns, and began by replacing this one with an offer from another merchant. More options, more keyword potential, much higher payout.

I am starting this campaign on a small scale - adding new Ad Groups one at a time, after exhaustive keyword digging. Very focused, very specific ads... and with my fingers crossed ;)

The other Campaigns that I have paused, I'd like to sit down and go over. Since I dont have the time to do that right this minute, they will just remain paused until I get to them - one at a time. Some are decent money-makers, but could stand some tweaking... and some have a lot of potential, and would just require putting a bit more time into them.

I've also been thinking about promoting my new affiliate site via PPC. Not the site in general, but specific categories or pages. It will give me an opportunity to test conversions on the traffic - from a variety of sources. One keyword may convert better than the other, obviously - so I plan to test them one at a time, and then adjust my optimization for that page if necessary.

It will also give me a good idea of "what's hot" now that the holidays are behind us - as keyword research tools, at this point, only tell us what people were searching for during the month of December...

While I am analyzing all of this data, and tweaking my PPC Campaigns to maximize their potential, I will continue to work towards gaining new Inbound Links... updating RSS Feeds... building the Mailing Lists... etc.

I am finding that it works best for me to set aside ONE HOUR each day to work on maintaining my income sources. It only takes a few minutes to update a feed, submit several articles, tweak a marketing campaign, sign up for a new affiliate program, gain a couple of inbound links, etc. In one hour, I can generally maintain all of these things - and also spend some time on additional research.

It's a good rule for consistent growth.

Even "Passive Income" requires maintenance. Some people mistakenly believe that it means you "work once" and then never have to work again. Not true. While I can generally spend a day or a week setting up a source of income, and then enjoy a profit from it for 6+ months... there comes a time when you have to change it, add to it, or replace it.

And it stands to reason that the more you put into it, the more you get out of it. Obviously, you can extend the life of a "stream of income" by continuing to feed it ;)

The people who enjoy a nice, fat Passive Income will tell you straight out that they worked hard to achieve it. And the majority of them will tell you that they still work. Most not out of necessity, but out of passion - continuously increasing their gross income in the process.

It's a good lifestyle - freedom, flexibility, security, and more. You work because you want to. You completely control your environment. Limitations and boundaries disappear altogether.

For anyone interested in Passive Income, I would highly recommend:

The Myth of Passive Income $39

I read this book earlier this year, and the words and the stories really stuck with me. Passive Income has been a personal goal of mine for some time now. While I did meet my financial goals for 2004, in the process I realized that if I could double or triple my income once... I could certainly do it again. And again.

This is not about earning a ridiculous income. Or being frivolous with money. This is about one single mother to two growing kids that is setting out to secure the future for her family.

I have lived paycheck-to-paycheck. I have lived without a paycheck. I know what it's like to struggle, and I've worked HARD to get to a place that is comfortable - both financially and emotionally.

... And I dont plan to move backwards from here ;) There are things to consider, such as: emergency funds, college tuition, retirement and more. I think life has proven to most of us that we cannot take anything for granted.