Income Report Nov 2018 – Winter is coming

Welcome to my income report for November 2018

In November I earned only $68, a small increment over the previous month, and a new all-time high, but still far under $100; hence I didn't achieve my goal of earning $100 of side income per month on average yet.

November is a month when everything slows down

First, winter is coming. Lack of sunlight makes you sick and depressed.

Second, slaving in 9-5 jobs for the past 10 months is becoming tiresome and it takes a toll on you.

Third, Christmas is just around the corner so you stop giving a fuck.

But not me, I took a week-long vacation in Egypt so I can catch some sunlight, relax a bit and bust my ass coding at nights.

It paid off. I made significant progress on my secret project and I am optimistic I can finish it in two or three months.

Income Breakdown

Sell Items Online

This category groups all my efforts of selling physical stuff online.

I accounted for zero sales in November.

There could be many reasons for that.

First, people saved their money for new Christmas gifts, not for used crap.

Second, I am running out of things to sell.

Eventually, this income stream will die out and the only way to make it sustainable is to build a regular e-commerce business.

But this would require enormous effort, time, money, and with no guarantee of business being profitable.

E-Commerce space in the Czech Republic is one of the most saturated markets in the world.

More than 50000 e-shops are serving only a 10 million population so logically the majority of e-shops are not profitable or worse are operating at loss.

But I will try it in the future if I find a product I like.

The first step would be to incorporate me which I plan to do in the second quarter next year.

Savings Accounts

This category groups all interest income earned on money deposited in savings accounts, checking accounts, and saving construction plans.

Saving accounts became my only reliable source of passive income.

At the end of November, I had 3 savings accounts in total and 1 construction saving plan. All utilized to the max.

In the environment of rising interest rates, savings accounts are the best place to park your money.

You can withdraw your money anytime you want and move it somewhere else if needed.

As National bank hike repo rates, most of the small banks will do the same to grow their balance sheets.

And the rising interest rate is the best way to attract more capital.

There are rumors, that the Czech National Bank will hike the repo rate two times next year, so my strategy is to be liquid and keep the maximum duration at 3 months top.

So I am always ready to move my capital away into a more profitable financial product.

I am still using my google spreadsheet to calculate optimal allocation.

But next month I would like to code a prototype of an allocation algorithm in python.

Let me know if you are interested in sharing the algorithm in the comment section below.

P2P Lending

This category groups all my income from investing in P2P loans.

Currently, I use 2 P2P lending platforms in total.

First is a traditional P2P lending platform, where you lend money to regular folks who need quick cash to live by.

This platform is very popular and has a good scoring process.

My goal is to invest in at least 500 loans by end of the 1st quarter of 2019.

So far, my P2P bot, which I created last month, catches all attractive loans as they appear on the platform, and thanks to this, my portfolio grows at a rate of 40 new loans a week.

I like how repayments are deposited each working day on my investor account.

It's a great feeling to wake up in the morning, check my P2P account, and see how much interest I earned.

THE second P2P lending platform is a middleman that allows you to invest in already invested loans owned by third party Personal loan providers.

They guarantee zero cost buyback if loans are not repaid after 60 days and an instant money withdrawal for a 1-2% fee.

The downside is a low-interest rate of 3.9% per loan and a high 1% monthly fee on invested capital.

I don't plan to risk more money on this platform because there is no room for portfolio diversification.

Why I didn't reach my goal yet.

A free time limited to only nights after work and weekends.

I spent 1-week blogging and 3 weeks of coding.

My fixed income portfolio is not optimal yet. So there is a lot of room for improvement.

What can be improved next month?

Allocate more capital in P2P Lending. My fixed income framework tells me to risk more to reach my goal.

My maximum duration threshold has decreased to 3 months so it will be tough to increase my passive income.

Business development

In December I will maintain my focus mainly on product development and less on finance or content development.

I thought a lot about freelancing and I will try to establish a new income stream from freelancing gigs.

Being a freelancer gives you more freedom and the ability to work remotely.

It also pushes out of your comfort zone, because you will lose your steady paycheck.

You will have to bust your ass to get new gigs, over and over again.

You will also have to manage taxes and accounting by yourself.

Despite the many cons, the pros are much more valuable so I will give it a shot.

Unfortunately, my first attempt at being a freelancer failed miserably.

I created an Upwork profile where I wanted to advertise my superior SQL skills. Spent 2 hours polishing each part of my profile, hit the submit button, and anticipated the approval process.

I was wrong. The day after I got a rejection mail stating, that my skills are not adding any value into an existing database of freelancers.

What a bummer.

Anyway, I won't give up easily and I will try other less restrictive freelancing portals next month.

Content development

1 paragraph a day was too optimistic. Instead, from now on I will write at least one paragraph every second day.

My thinking in English became much more fluent. I feel I can articulate my thoughts more easily than ever before.

I can argue in English using facts and common sentences.

Writing a blog starts to pay off.

Project development

I finally finished the design of my secret project and now I can fully focus on coding functional logic.

After reading a free book on React JS, I am not afraid of coding in React anymore. Now I understand the meaning of props, states, and component cycles.

I am very happy, that I chose to React stack. If I tried to stick with PHP and WordPress, I would be lost in my code after the first commit.

In December I would like to finish my first minimum viable product and launch it on Producthunt next year.

That would be all for this month. See ya in the next income report!