Passive Income Update 2019

Passive income 2019Whoa, 2019 is over! Another year is in the book. 2019 was a tough year for our passive income. I tried to consolidate our rental properties, but wasn’t entirely successful. As a result, our rental income decreased tremendously from last year. We also spent quite a bit on repair and maintenance. However, our cost of living also dropped so it worked out. In addition, Q4 was a great quarter for us. One of our real estate crowdfunding investments wrapped and paid out over $1,700. The annual ROI for that project was about 65%. Wow, it’d be great if all investments work out like that. Anyway, Q4 was a good quarter for us.

*FI ratio = passive income / expense

2019 passive income quarterly

Passive Income is Key

Passive income is one of the keys to a successful early retirement. Once you generate enough passive income to cover your cost of living, then you’re financially independent. I retired before our passive income was there, but I had an alternate source of income – blogging. Luckily, early retirement worked out very well for me over the last 7 years. However, we are still struggling to reach 100% FI ratio consistently. I’m sure we’ll get there at some point, but it will take time.

Currently, we support our moderate lifestyle with the combination of these income streams:

  • Mrs. RB40 works full-time. She plans to retire in 2020.
  • I blog a few hours per day and make a few bucks online.
  • Passive Income – We have passive income from the stock market, rental properties, and other investments.

FI Ratio

The FI ratio is a simple way to measure progress toward total financial independence. Personally, I think 100% FI ratio is overkill because nobody stops working completely after early retirement. But it’s better to err on the side of caution.

Our FI ratio was incredible in 2019. Our expense is lower than in previous years because our housing expenses decreased. As a result, our FI ratio finished the year at 118%. That’s the highest it has ever been. If all goes well, we should be able to improve it even more in 2020.

Real Estate Crowdfunding Income: 2019 target $3,000

I started investing in real estate crowdfunding in 2017. My experience has been mostly positive. There were some problems, but I still think it’s a good way to invest in real estate. However, this is a new way to invest and it is risky. I plan to cap our asset allocation to 5% for this class of investment.

This year, I’m primarily investing with CrowdStreet and PeerStreet. They both have a very good track record. I like CrowdStreet more because there are fewer turnovers. PeerStreet is good, but you have to keep reinvesting. It takes more time than I’d like.

Real estate crowdfunding is great because you can diversify to different areas of the country. Portland’s real estate market is slowing down tremendously and there are too many new landlord-tenant rules.

Here are the projects I invested in.

2019 real estate crowdfunding income

Real estate projects I invested in

  1. CrowdStreet – Earlier this year, I signed up with CrowdStreet and invested $40,000 in an apartment complex in Texas. This project is doing well. We received payment in Q4 and we should see another one next quarter. CrowdStreet is the best RE crowdfunding company on the market right now. Their commercial projects are first class and should weather the downturn pretty well. I’ll keep you updated on this. Check out their project by signing up for a free account at CrowdStreet.
  2. PeerStreet – PeerStreet is really good too. This is strictly hard money lending so the income potential is not as high as equity deals. I invested in 12 properties so far and it’s working out pretty well. (6 already closed.) However, you have to keep looking for new deals to invest in. That takes a lot of time and I prefer longer-term investments. That’s why I like CrowdStreet. PeerStreet has a very good reputation so check them out.
  3. A strip mall in Arizona ($8,000.) This was an equity investment. The estimated cash on cash return is 7% per year. After 3 years, the property will be sold. The estimated total rate of return is about 17% per year. The payments have been on time so far.
  4. A fast-food restaurant in Florida ($5,000) This one is a senior debt loan and the payments have been on time. The interest rate is a flat 9.5% per year. This project is in trouble. The borrower has run out of funds to complete the project. *Good news!* The developer agreed to pay investors back 100%. We’ll have to wait and see if it will really work out. We won’t make much money from this deal, but at least we’ll get our money back. This is why RE crowdfunding is much better than P2P lending.
  5. An apartment in Texas ($5,000.) This equity deal is going well so far. The estimated cash on cash return is 10% per year. After 3 years, the property will be sold. The estimated total rate of return is about 16% per year. This project closed out in Q4. The total return is $2,784 in 14 months. That’s about 65% per year. Wow, that’s amazing.
  6. An apartment in Arizona ($10,000.) This equity deal is going well so far. The estimated cash on cash return is 10% per year. After 5 years, the property will be sold. The estimated total rate of return is about 16% per year.
  7. An apartment in North Carolina ($10,000.) This equity deal is going well. The estimated cash on cash return is 8% per year. After 4 years, the property will be sold. The estimated total rate of return is about 17% per year.

Real estate crowdfunding is relatively new and it can be risky. I like it because the diversification it offers, but it won’t work out if there are too many defaults. It looks like our first default will work out well, but we’ll have to wait and see. I’ll keep you updated.

*Estimated ROI is just that, an estimate. There are risks with any investments including real estate. If you’re not comfortable with real estate crowdfunding, I recommend REITs. They are more established and also have good returns. We have some REITs in our dividend portfolio.

If you’re interested in real estate crowdfunding, sign up with these companies below and check out their projects. You don’t have to invest if you don’t see something you like. Some of those projects are quite impressive.

  • CrowdStreet – CrowdStreet focuses on commercial properties across the USA. They have apartments, hotels, self-storage units, strip malls, office buildings, and more. The minimum investment here starts at $25,000 which is a bit higher than other companies. They have some great projects lined up, though. Sign up for free with CrowdStreet and check them out.
  • PeerStreet – PeerStreet has a very good reputation. Investors can invest in private lending with real estate backing. The only issue I’ve had is the early completion. Some projects finished very quickly and I had to spend time to find a new project to invest in. PeerStreet only accepts investment from accredited investors*.
  • RealtyMogul – All investors can invest in REIT deals at RealtyMogul. In addition, accredited investors can invest in private projects and do a 1031 exchange.
  • Fundrise – Non-accredited investors can invest in iREIT here.

 *Accredited investor needs to have over $200,000 of income over the last 2 years or a net worth of over $1,000,000.

Rental Property Income: 2019 target $2,000

We are going through some changes this year. Last year, we had a rental duplex and a rental condo. This year, we tried to consolidate down to just one unit. We moved into one unit in the duplex and the rest went up for sale. This reduced our passive income, but our cost of living dropped too.

The main reason for consolidation is personal. I need to spend more time in Thailand to help my mom and Mrs. RB40 doesn’t want to deal with the tenants while I’m gone. The real estate in Portland is also softening. I think it’s a good time to get out.

Unfortunately, we couldn’t sell our 1 bedroom condo. We’ll have to rent it out for a few years until the market recovers. It’s rented now so our rental income should improve in 2020.

2019 YTD rental income: $724

The YTD rental income is not good. It was on track until we replaced a balcony door at one unit (-$1,322.) That put a huge dent into our rental income. I’m looking forward to a better year in 2020.

Passive Income2016201720182019

Dividend Income: 2019 target $15,000

Dividend is my favorite form of passive income. Investors own a small part of these public companies and they work for you. These days, I focus on companies that consistently grow their dividend income over the years. This strategy will ensure that our dividend income keeps growing even if we don’t add new money. Currently, we reinvest all the income from this portfolio, but we may use it to pay our expenses once Mrs. RB40 retires. If you’re a new investor, here is a helpful post – How to Start Investing in Dividend Stocks.

As for reinvestment, I don’t DRIP in this portfolio. I just accumulate the dividend and invest in a stock or real estate crowdfunding whenever I see good value. Currently, we have quite a bit of cash in our dividend portfolio. I sold some stocks last year and haven’t reinvested everything yet.

For 2019, I hoped to generate $15,000 from our dividend portfolio. We had a tremendous Q4, but we still missed the mark by a few hundred dollars. Oh well, next year will be better.

For new investors, I highly recommend Firstrade. Firstrade is a great discount brokerage that I used for many years. Recently, they lowered their trading fees to $0. That’s great news! Young investors can buy stock without having to worry about the fees. Other discount brokerages are following suit and offer no trading fee now.

YTD dividend income = $14,791

dividend quarterly

Tax-advantaged Income: 2019 target $35,000

New investors should read these posts first.

The money in these retirement accounts isn’t easily accessible at this time (I’m 45), but they still count as passive income. Once we both retire full time, we’ll build a Roth IRA ladder to access our traditional IRAs so we don’t have to pay the 10% early withdrawal penalty. All of the investments in these accounts are invested in low-cost Vanguard funds. The dividend income here will be reinvested via DRIP (back into the funds). You can see our YTD income in the spreadsheet below.

tax advantaged accounts

Oh man, I didn’t reach my target here either. Oh well, let’s try again in 2020.

Somewhat Passive Income – Blogging

Blogging isn’t very passive for me at this point. Usually, I spend 20-30 hours per week writing, networking, responding to comments, and maintaining Retire by 40. Someday, I’d like to cut it down to around 10 hours per week. That goal is a few years off, but I am cutting way back on work in the summer. In Q3 and Q4, I worked just 10-15 hours per week. Being a stay-at-home dad was job 1 during the summer break. I kept the summer schedule until the end of the year because I had too many things on my to-do list. We’re back to 2 new posts per week again.

Anyway, the blog income is a huge bonus. When I started Retire by 40 in 2010, my goal was to generate about $500/month. After 9 years, the blog income has grown tremendously. I’m very grateful for your support. Thank you!

2019 YTD Blog Income: $40,618 YTD

My blog income slowed significantly in 2019. This is probably due to market saturation. A lot of people already signed up for Personal Capital so we don’t see as many conversions this year. That’s okay. I’ve always expected that income to drop. I’ll have to work with some new partners to bring it back up. I’ll probably make about half of what I made last year.

Here is how we generated online income in 2019.

Revenue: $47,338

  • Banner ads: $27,085. These are the banner ads you see on Retire by 40. I hope to make about $2,000 per month with these ads. This worked out very well in 2019.
  • Affiliates: $18,652. These are referral fees from affiliate links. If a reader signs up for a service through our affiliate links, then we may receive a referral fee. Affiliate income slowed down significantly in 2019. I’ll have to work on this one. I’d like to bring it up to $2,000/month. Currently, the average is around $1,740/month.
  • Private ads: $1,600. Occasionally, we worked with a company to advertise their products. I rarely do this anymore. This income will be very small in 2019.

Expense: $13,124

  • Business: -$4,179. Business equipment, internet, hosting, email service, CDN, cell phone, etc…
  • Travel and meals: -$890
  • Employee: -$1,666. This year, RB40Jr is our part-time photographer/model. I’ll pay him $25 for each image I use in a blog post and $4 per image on social media. This income will go straight to his Roth IRA. I’m excited to see how this experiment will turn out.
  • Taxes: $6,397.

Here is the graph of our 2019 revenue, expenses, and net income.

2019 blog income

2019 Wrap Up

Here is our passive income spreadsheet since 2016.

passive income

Whew! 2019 turned out well after all. Our passive income dropped a bit, but that was mostly due to money not working. It took a long time to sell our condo and the money was just sitting around. Once that money was invested, our passive income increased. Next year should be much better.

Also, our FI ratio was excellent in 2019. Our living expenses dropped quite a bit. Our housing cost is less because we live in a duplex and share some expenses. Also, we didn’t pay much for our travel last year. Travel hacking worked out very well.

For 2020, I expect our passive income to increase a bit and our expenses to stay relatively stable. We’ll continue to reinvest and keep at it. Our FI ratio should improve to 120%. That’s really the measure of our progress. Who knows what’s going to happen, though? There are many variables. Happy New Year and good luck in 2020!

What about you? How was your passive income in 2019?

*Sign up for a free account at Personal Capital to help manage your net worth and investment accounts. I log in almost every day to check on our accounts. It’s a great site for DIY investors.

The following two tabs change content below.
Joe started Retire by 40 in 2010 to figure out how to retire early. After 16 years of investing and saving, he achieved financial independence and retired at 38.

Passive income is the key to early retirement. This year, Joe is investing in commercial real estate with CrowdStreet. They have many projects across the USA so check them out!

Joe also highly recommends Personal Capital for DIY investors. They have many useful tools that will help you reach financial independence.
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76 thoughts on “Passive Income Update 2019”

  1. Congratulations on last year’s passive income — that is amazing! I would love to get to that level. In the meantime, it is really nice building up savings. I’ve been at it for ~7 years and am finally feeling like I see some progress. I’m glad to see that investment income can help my numbers rise even in years where I can’t contribute as large a % of my salary.

    As for your renter with the heels . . . hmm. Can’t explain that one! I’m a renter, but I never even wear heels outside and can’t imagine walking around my apartment in something other than socks or slippers. Seems very strange.

    • I tried P2P lending for a few years. It just didn’t work out. There were too many defaults, took too much work, and the ROI was too low. I think I only made around 6%. Unsecured lending is too risky for me.
      on the other hand, real estate crowdfunding has been much better. The loans are secured with real properties and the ROI is very good.

  2. My experience with PeerStreet is the exact opposite of yours. Of my 5 active investments 4 are in default with one $2,000 position supposed to have closed over 1 year ago. The pace of trying to collect anything is at a glacial pace consisting of multiple notices of the same type (“The originating lender is contacting the borrower regarding the late payment.”) followed by legal maneuvering. Very unfortunate as I wished to diversify my portfolio but lending to eventual deadbeats is a total waste of money.

    • I’m sorry to hear that. How long have you invested with them?
      We invested in 12 projects. 6 exited without any issue. Actually, they excited too fast. I don’t want to spend a lot of time trying to find new investments. 5 is current and 1 is 30 days late.

      It’s going pretty well right now, but they are relatively new projects. From my experience, older projects have more chance to default. Your rate of success is pretty bad. I think most people have a better experience with PeerStreet.

      I suggest you invest in something else. Lending might not be a good option for you.
      REITs are much easier and they have a long track record. Good luck!

      • I have been invested with PeerStreet for 2 years. 8 investments have closed on time. I utilized the criteria of borrower credit score > 650, LTV (capital stack) < 65%, lender – NO defaulted or REO loans, loan duration – 12 months or less, & interest rate 8-9% so my overall default rate is 5/13 or 31% which is completely ridiculous. I am done with PeerStreet (& all real estate deals) but who knows how long or if I will get any money back from the defaults.

  3. Awesome Joe on your annual passive income numbers. The key is that it already surpasses your expenses and thus you are not draining your nest egg.

    Keep up the good work. I agree that blogging is not passive at all. Still very impressive numbers and something I would love to hit one day if the hard work I put eventually pays off.

  4. Great numbers Joe! Congratulations! Still, I always keep wondering about the meaningfulness of “FI ratio” and “passive income”. Tracking those as main metrics pushes the investments to dividend stocks, rental appartments and other instruments that generate cashflow. I personally prefer ETFs that reinvest all dividents, and thus the passive income stays low.

    • FI ratio is more relevant when you’re retired or close to retirement. If you’re in the wealth-building phase, you probably should just look at net worth. As long as your net worth increases, you’re doing well. Good luck!

  5. I sold a property I bought in 2012 for 2.5x the purchase price. I moved every penny out of the stock market and into T-bills in September 2018 right before the crash , which hurts more each day as T-bill rates continue to fall.

  6. I’ve been looking at rentals lately but still feel hesitant. While the benefits are so clearly laid out in books/podcasts, almost all my friends with rentals have had issues with their tenants or maintenance costing too much. So far my only exposure to real estate is a small amount in real estate crowdfunding and things might remain that way for some time.

  7. Nicely done!

    Alas, I have no passive income right now, except for a little from blogging. But I put enough effort into that that I don’t consider it “passive.” And I don’t count growth in my IRAs because my accessing them will be so far off. So for now my passive income is $0. But I hope to get to a point where I can start investing outside of my IRAs in the next couple of years. Time will tell.

  8. Hi Joe,

    Thanks for the blog post, super interesting!

    A quick question about the set up of the blog more broadly. Do you simply add the income from the blog to your personal income? Or have you set up an LLC/corporation and run the income through that?



  9. Nice update. Crazy to hear about the borrower problem in FL, that’s most of my concern investing in those real estate lending programs, it only takes one event/ downturn for the risk to come out. Must have had you on edge for some time as things were worked out. Glad the issue was resolved though!

    • I hope the check comes in soon. It’s still iffy until then.
      At least with RE crowdfunding, there is collateral. You’ll get some money back. That’s way better than lending just on credit score, P2P lending.

  10. Thank you for the update. It’s nice to see your honesty with bog income. Some bloggers boast about 7 figure blog incomes. While it may be possible that must be few and far between. At least blogging is fun, I enjoy learning new topics and sharing with others. The few extra bucks are icing on the cake.

  11. At the end of this month I should know a lot better about my 3rd quarter status. A lot of my real estate syndications do not send out distributions at the end of the quarter but rather the month after.

    This is where the bulk of my passive income lies.

    I think you will be much happier consolidating your direct real estate down and putting the proceeds in a REIT will still give you good returns but far more passive.

  12. Looks like you’re continuing to do fantastic Joe! The fact your passive income exceeds your expenses is great, then add all that juicy blog income and you are killing it!

    My dividend income might be higher than yours, but I’m stuck with higher expenses until my youngest gets out of preschool. Childcare is expensive! That’ll be a great day!

  13. Hi Joe! I’m an Asian sister living the post-FI life, before 40. (Sorry to be slightly racist there, just how I actually feel!)

    I wanted to ask, have you found any good resources for what happens after FIRE? We’ve been through all the emotions, and had some major life revelations, and I’m wondering if there’s some kind of support out there, for what’s next.

    [And to those working towards it, I know it sounds like a silly problem, but after a few years you realize there isn’t really a sunset to ride off into. 🙂 And that can lead into all kinds of existential questions!]

    We travel full time with our kids, so I’d love to find some regular community rhythm, even if it’s online! Anyhow, thank you for your contributions! Paying your Jr has given me ideas as well – my teenager will thank you later. 😉

    • I don’t have any good resource for life after FIRE. It seems to be scattered all over the internet.
      Maybe I can start a forum with that focus.
      Enjoy your travel. It sounds like fun. We’d love to do that for a year or so.

  14. Hi Joe—even though your blog income has slowed this year, it’s still an awesomely huge number! You’re an inspiration to me in many ways, and I hope to be just 1/4 as successful as you one day.

    I love how you weave in little snippets of your life as a SAHD in all your posts. I find it really interesting, being a stay-at-home parent myself.

    I’ve also had to cut way back on blogging activities over the summer. I’m not sure how you’re able to write and publish one article a week with a kid at home full-time! I need to learn to write faster!

    Anyway, thanks for sharing this update. As always, it’s inspiring and entertaining. 😉

    • Thanks for the encouragement!
      Being a stay-at-home parent is great. I think it gets easier as the kids get older. We’ll see if that’s true.
      I usually write on Sunday. Our son can spend more time with Mrs. RB40 that day.

  15. Hey Joe,

    Net net would you still advise a person to go down the landlord path? We are thinking about a duplex potentially in the future. Would you still go that way or do something else? Thanks!


    • Definitely, I think you should try it and see. Some people can make it work really well and it will be worth it.
      Even if you can’t make it work, you can sell and probably won’t lose too much money. It’s a great way to invest.
      I really like living in one unit in the duplex. Having a tenant really helps.

  16. Wow, that’s a lot of passive income! I think it’s great that the blog makes so much money (even if it’s less than in previous years). I hope to make even a fraction of that amount one day. I’ll just have to work on growing the blog and going from there.

    I hope the real estate crowdfunding turns out okay. The default and repairs must have you a little nervous.

    • Thanks! I’m pretty happy with our passive income too. Overall, it is looking good.
      The default is problem. We’ll have to wait and see how much we recover. I hope at least 60%…

  17. Great progress!! I find it very interesting to read and see the dirty details about investing and managing rental properties. They offer an enormous potential but with the unavoidable hassle.

    How have you streamlined the process in case of repairs etc.? Do you arrange everything yourself or have you agreed a certain amount (e.g. below $100) with tenants so they can call a plumber/repair guy themselves?

    I’m looking at rental properties as well. But in the Netherlands the Real Estate market is on fire… not really the best time to put money to work in the RE market.

    Good luck!

    • I did everything myself because I had time. But now I have to spend more time in Thailand and Mrs. RB40 doesn’t want to deal with the rentals. That’s the main reason we’re consolidating. Nothing is below $100 these days…
      Good luck with the rentals.

  18. Nice 1Q update! Rentals can indeed be a headache but also offer a nice return. Income for 1Q for us was about $30k: 11k real estate, 8k dividends, 5k private equity, and 6k consulting (semi passive).

  19. I am not a fan on dealing with rental property issues. They also inevitably come at the worse possible time such as when I’m on vacation in Disney with my kids. But I also realize that I have to take the good with the bad. Overall, I am very high on rental properties. As long as I am cash flowing on them, I tend to be more tolerant of issues which pop up.

    I am trying to get my (semi) passive income high enough to cover all my expenses. My biggest income outside of a paycheck from my company is my rental income. I would like to increase my rental income by at least 80% over the next two years. Tall goal but I already outlined a pathway to get there.

  20. Hi Joe,
    In your post you say that you believe 100% FI ratio is overkill. Is this because, in addition to income, people can withdraw some of the capital to meet their expenses (and assuming the capital withdrawal is sensible their investments will still provide for them throughout their retirement)?

  21. Joe, go ahead and put the unit up for rent. Tell tenants that the custom closet door is coming.
    So very sorry to see the floor marked up from high heels. Friends had this happen to their gorgeous floors after a party. Really bad news. Sure you can’t go back to this tenant and get the full repair price??
    I would put it in the new lease-NO high heels on the wood floors! And, I would take extensive, detailed photos before renting to new tenants. Looking out for #1-you!

    • Actually, we are going to put it up for sale. We’ll just leave a sign saying the closet door is on the way.
      Yeah, I was mad about the flooring too. But I don’t want to go to court. They paid a good chunk so I’m okay with that.

  22. I can’t believe you made your tenant pay for the floor. This is not Japan; this is America – many people walk around the house with shoes on. That must be some pretty soft (i.e. cheap) wood to produce divots in the first place.

    • The floor is red oak. That’s standard flooring. You can’t walk around with high heels on the hardwood floor. It will damage it especially when the heels are worn out. I already told them not to do that. It’s in the lease.

  23. Hi Joe, wow, someone walks at home with those high heels. I totally gave up the high heels 22 years ago, and never missed it. It was so uncomfortable to me.

    It looks you did a lot of those rental repairs by yourself. Good for you. Not many people including me have the skills or patience to handle it. Hope you have a great Q2!

  24. Whew that’s a lot of blogging income. I haven’t made $80,000 from my blog as a whole in 11 years, let alone in one year. So admittedly a tad jealous. But I also haven’t been able to put in as much time as you have, I think, so that definitely explains some of it. The other is that I just haven’t found any good affiliates that I feel like hyping. Which makes sense since I don’t talk about investing, so things like Personal Capital just don’t fit into my blog right now. And of course I suspect the saturation you mentioned is going to play a factor even when I do start that kind of stuff. But that’s my own fault for not jumping on the bandwagon more quickly!

    Glad you’re doing so well this year, even if blog income is down and the rentals are causing some short-term expenses. Soon the repairs will be done, the sting of them will fade, and you can enjoy the simplicity of having just one unit to rent!

    • I’m not too optimistic about blogging income. It will probably continue to decrease unless I can find new affiliates.
      The affiliate income from Personal Capital is about 50% compare to last year at this time. It’s not looking too good. A lot of people already signed up.
      Life should be much simpler with just the duplex. I hope…

  25. Hi Joe, I had fist-sized holes on the doors in my rental properties that looked kind of like your closet door. I repaired it just like drywall. It’s barely noticeable after sanding and painting, and I am no professional. You might want to consider that rather than replacing the doors, it’s much cheaper and faster to repair.

    • The hole is much worse on the other side. There is a big crack that runs all the way to the edge. The closet pivot foot is also broken and can’t be repaired. At this point, it’s better to just replace it. Thanks for the input.

  26. Sorry to hear about the issues you’re seeing with the condo. That must be a major headache for you. 🙁 That’s one of the reasons why we haven’t invested in a rental property…we don’t want to have to deal with these headaches. (Plus BC rental laws side with renters… some of our friends that are landlord have had really bad renter experience).

    FI ratio over 100% is really impressive! We got almost $6k in dividend income in Q1 but we’re not quite at 100% FI ratio yet.

    • Last week was very stressful for me. I’m feeling a bit better this week. I got the ball rolling and it will fix soon. Once these condos sold off, life would be much smoother. Good job with your dividend. I’m sure you’ll be there soon. Your dividend is growing very rapidly.

  27. We did our floors in December. It was a nightmare to clear out all the furniture and live in only part of the house. I don’t blame you for wanting to wait on that.

    It sounds like this is the time of the year that real estate isn’t so passive. Fortunately if you are getting out it will be better.

    I’m thinking about start adding a FI Ratio to my reports. The problem is that I do a lot of estimating and averaging because I’m too lazy to track the numbers to the dollar. Because of that the ratio would probably not change month to month much.

    • Right, I didn’t notice the divots until after we moved in. I guess if you don’t know they’re there you won’t notice them much. We’ll wait to fix the flooring. Being a landlord can be a headache sometimes.

  28. FI ratio is the key here. If you are able to keep it above 100 percent, I think it is more than enough.
    I am still in early stages of starting to build passive income streams.

    Just a question on blog income Joe, you say that market is saturated. Is it the Vlog effect? I see lot of viewership shifting to videos than reading out. Did you consider writing a post on this topic?

    • Vlog and podcast are probably part of the issue. I might have to diversify into that space at some point. But I’m not good at that, though. I don’t think I’m going to write a post on the topic. It’s not my specialty.

  29. Oh man, that leak looks like a b*tch. May I ask how you’re going to get your tenants to pay for the fixes? Did they cause the leak?

    I ask b/c I had a leak in my light well one time. that leaked through my dining room ceiling. But I fixed it and didn’t charge them b/c they didn’t cause the leak.

    I’ll be able to help you with your private ads this quarter whoo hoo!


    • No, it’s not their fault. They should have notified me when they see an issue, though. I guess they just didn’t really notice it. The leak is from the upstairs neighbor. They need to fix the leak and pay for the damages. Their homeowner insurance should cover it.
      Thanks for your help. I appreciate it.

  30. once you hear our renovation story about our attic you will feel a certain kinship. it’s coming in way over budget. i love that you’re funding a roth with junior’s income. i’m going to write a post soon about how and why families ought to do that if they can afford it. are you going to issue him a 1099 or just file him a tax return. best i can tell a kid has to file a 1040 like it was income from something like mowing lawns or babysitting that an older kid might do.

    • That’s why I dislike remodeling. It’s always more expensive than you think.
      I’ll file tax for him this year. Also, issue a W2. There is not much information on this. I think either 1099 or W2 would be fine.

  31. Feeling very far behind on the retirement income covering expenses percentage after reading your post. I am only at 36% and I know I am older than you. If I count the first Canadian pension that I can start collecting at age 60 then I guess I am at 60% but I really don’t want to work another minute let alone until age 60.

    It seems I started my journey to financial independence too late. Perhaps you could consider writing about what people like me can do to improve our chances of retiring before the traditional retirement age.

    • I will work on a post for you. If you’re in your 50s, then you should go for the 4% rule. So aim for a net worth that’s 25x your annual expense. That should work out fine for most people.
      For younger people, the FI ratio is better because it’s more conservative. If someone retires at 40, they can have 50 years of retirement left.
      I’ll get in touch with you to get a bit more detail.

  32. Sorry about the issues with the condos. I had a pair of condos I lost in the divorce and they were the two assets I was happy to do so. I was not cut out to be a landlord and as I am not as handy as you, I had to pay someone to solve the things that cropped up (and they always did crop up).

    Very impressive about the blog income and overall history of blog income. Blogging definitely is not passive but it is a nice diversion/past time for me. My #s are miniscule compared to yours but of course you have had many more years doing it and built up quite a following. You are right that the market is saturating and I doubt the type of income the long time bloggers have garnered is available anymore.

    • I’ll be glad when these condos are gone too. That’s too much work for me at this point in life.
      You’re right about blogging. I think it’s much more difficult now to get started. But some people still can do it.
      It’s a crapshoot.

  33. Way to go Joe, still killin’ it. I have a hole from an old roof leak that looks similar to yours but it’s in a closet that I never use. I got the roof fixed a while ago but have been lazy in fixing the hole. I’m a good procrastinator.

  34. Hey Joe, glad to see you’re making progress consolidating and making life simpler for yourself and your wife. Why in the world would someone strut around their house in high heels? I’d be quite annoyed too… speaking of which, we have hardwood floors in one of our rentals and I’m sure I’ll be aghast when I see it someday in the after renter’s condition.

    Nice job with the passive income in 2018. It’s okay if 2019 is slower given your focus is shifted. You’ve created a great site with a lot more potential when you’re ready.

    • I don’t have a specific post on that. I use Amazon, Commission Junction, Personal Capital, and Siteground. Those are the main affiliates for me. You should try Commission Junction and see what kind of products will work for your readers. It can be tough to find the right affiliate.


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