How do you make money.

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Originally Posted by Greyblades

Well yeah I'm not saying I have to live off 500 a month, what I would like is to use what I get to learn, I basically am at a practice stage, living off my parents dime in my parents house with a generous allowance with which to pay for transport to university and the leftovers with which to experiment, I don't need to to live off the profits right now but I would like to use said leftovers productively and learning to use money to earn more money seems pretty productive and even appealing.

Sometimes I wish I had better communication skills so the misunderstandings wouldn't take several posts to explain.

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Well, the first and most important step is to learn how to budget. You need to categorize your income into three separate areas. First, determine how much money you need to pay for essentials, such as food, housing, transportation, etc. Do not include any luxuries in here, only the bare minimum necessary. Second, set yourself a specific level of savings to put away for the future. More on this later, but a good rule of thumb is 10% of your income. So, with an income of 500 GBP per month, this would be 50 GBP. Third, everything else left over is your disposable income. If you do not already have them, open two bank accounts, a checking account and a savings account. Every month, deposit 450 GBP into the checking account and 50 GBP into the savings account. Ignore the savings account for now; pretend it doesn't exist. Pay your bills exclusively from checking. Your disposable income will remain in checking and will slowly accumulate. You can do multiple things with your disposable income. First, you can spend it on luxuries, like entertainment, a good meal, or some nice item or piece of clothing which is not covered by your essentials. Second, you can save it for bigger luxuries. For example, you might want to buy a new computer which costs 1000 GBP. Obviously one month's of disposable income is not enough to pay for this. So, don't spend your disposable income for several months and instead save it up. When you've got enough got the computer, then you buy it. Third, make larger than normal deposits into savings.

Do not run up debt. Credit cards are good things, and I recommend using them. They are easier than carrying around cash, will build a credit record for you (which is important in future years), and you can even save money with them if you've got a card that gives you some kind of cash-back or reward system. The important thing, though, is to NEVER run a balance on the card. Always pay the balance of the card in full every month. If you do this, the credit card costs you nothing (avoid annual fee cards like AMEX, you don't need them). If you cannot afford something based on the amount of money in your checking account, you just don't buy it.

Continue this way until your savings account has enough money in it to allow you to live off of that account with no other source of income for six months. That money is now your emergency fund, and you will never touch it. It exists to bail you out of bad situations, such as unemployment or unexpected medical expenses. It is a safety net for your financial life, and you should always keep it safe in a savings account and never invest it or put it someplace where you cannot access it immediately and in full. From this point on, your monthly savings can instead be diverted into investments. These are the stocks and bonds that you hear so much about. There is a lot to learn about this stuff, but you're still at the beginning of the process so you don't need to worry about it yet. When you get there, find someone who's knowledgeable about it and pick their brains. As your income level increases, your lifestyle will increase as well and you should regularly rebalance the 'essentials' and the savings to ensure that they keep up with your means and your needs. Also make sure that your six-month emergency fund remains a six-month fund. If your lifestyle has changed such that your emergency fund will now only cover four months of living, you need to spend some time topping it up again. You also want to immediately top it up if you ever have to take money out of it.

Above all, do not go into debt for unnecessary things. You will probably need a loan to buy a house or a car, but those are special cases and worthy of their own discussion. Other than that, if you cannot pay for the item in full, do not buy it.

Just blow it all on booze and women...

Or save it all up 'til you get married and your wife will blow it all on shoes and slimming...

Ah, but 'tis my curse to be adverse to that sweet liquor you sup,
Booze, that elder sap that some do tap to fill thier wanting cup...

Drat. I try to write drunkenly and I end up getting poetic.
I dont like the taste of alcohol and the brothels in the area are bloody well hidden, why else would I be taking economic advice?

What Uni course are you studying? (Helps to understand your mathematical ability)

Use your local library and indeed your Uni library. Just like a physical fitness program use your libraries to build up knowledge in what are stocks, bonds and other investment vehicles.

Use the Internet. I've seen self learning modules produced by stock exchanges ie: http://www.asx.com.au/resources/shares-courses.htm

Once you understand the vehicle then understand the company and what it produces or services. Easiest way is to invest in things that you use on a day to day basis that you like. If you buy it in a supermarket and you don't like it then don't buy it. Essentially buy shares that would make up your personal preferred CPI. This does require you to do the shopping, also you can look at getting up early and going to farmers markets and buying fresh bulk produce. Just make sure you don't waste it.

Read up about great investors and entrepreneurs particle focus on how they got started.

Start with Warren Buffet for instance.

Well I was told to do what I like doing and not what I think others think is good for me, so I'm on a creative writing course (irony in 3..2..1..), not sure what I was thinking there but it could have been worse, before that I was doing a mathematics A-level.

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Originally Posted by Greyblades

...and the brothels in the area are bloody well hidden, why else would I be taking economic advice?

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I gather because you want to be screwed any way you can get it. ~D ~:pat:

Well turn your passion into an income stream before you leave Uni.

Start writing and aim for magazines to publish in. Just be prepared to be rejected.

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Originally Posted by Greyblades

Did you get sick of people telling you the same thing, over and over again, too?

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Yep - and now I live in a room that's about 12 x 12 feet and doesn't have double glazing, and between the PhD I need for my career and work I have no free time.

I was, however, smart enough to save the money my parents gave me - and walk to Uni.

It went in an ISA, after 3 years £3,000 was £4,000

I worked 50 hours a week during and school and managed to come out nearly debt free

That's really all I got

I drank allot and cut up allot of cows, piggies, and chickens

I also had some very regertable sex

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Originally Posted by Philipvs Vallindervs Calicvla

Yep - and now I live in a room that's about 12 x 12 feet and doesn't have double glazing, and between the PhD I need for my career and work I have no free time.

I was, however, smart enough to save the money my parents gave me - and walk to Uni.

It went in an ISA, after 3 years £3,000 was £4,000

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Um... I've got it better than you now, and I couldn't walk to university from my home if I wanted to, add that to the impression I'm getting that you are set on a career and have no alternatives I doubt that I have much to take from your posts besides restating the info I've been given for the last 12 years.

Brosideon, are you having another midlife crisis?

You posted earlier musing about how a wife and kids would be a lackluster pinnacle to your exsistance. You should take a step back and be reminded of your position in the world, of course this is not to say "think of all the starving brown people" that's a lazy, tired cliche and I bloody well hate it. It is however a reminder that life is not some sort of hollywood adventure and even Churchill had his share of boring family dinners and drab days under the hellscape otherwise known as English weather

Money is not an escape from this. Of course being financially secure is very,very important. I don't mean not to stress that but I do mean to tell you that thinking you'll play some stocks, make money hand over fist and spend your 20s living some sort of playboy lifestyle is a pipe dream.

Now speaking as a simple man with simple tastes I can say money is not overly important to me. I want enough to provide for my family and not worry about lifes little curveballs. I don't care for flash. Granted I realize not everyone is like this and I certainly don't consider it a fault if you want the oppisite kind of lifestyle. I only mean to say that should not be the fulcrum on which your life tunrs wether you end up poor or rich. Your passions should be that fulcrum. Money is an abberation and fleeting, granted it is a powerful abberation but a lot of money is just that a lot of money. It's not happiness or comfort, success or intellegince, it's just money.

Feeling insecure at this time in your life is normal. I know you posted about money but the underlying thought in all your posts is fear and insecurity, completly normal things for a young man. I see someone who respects his parents and at least has an eye towards the future and his place in the world. I say you're not doing half bad.

You have your whole life to make a fortune and lose a fortune, I suggest you start pouring your efforts into things that matter. Money is an unfortunate prerequisite for life, not the other way around

I dont have midlife crisises, I have one big life long crisis where I have basically all I want right now, food, water, shelter, company, the internet etc, and there's a time limit to how long it lasts, either the bread winner kicks me out or dies and I go from the lower middle class life of mild comfort and the freedom to persue my interests freely, to having to make something out of myself in the real world... and I've had enough bad experiences during my life that the only thing I am certain I either want or dont want; is that wherever I end up I dont want to be where my compulsory education seemed to want me to be.

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Originally Posted by Greyblades

I dont like the taste of alcohol and the brothels in the area are bloody well hidden, why else would I be taking economic advice?

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Then you have no money problems......?

(and btw I wasn't suggesting brothels)

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Originally Posted by Greyblades

Um... I've got it better than you now, and I couldn't walk to university from my home if I wanted to, add that to the impression I'm getting that you are set on a career and have no alternatives I doubt that I have much to take from your posts besides restating the info I've been given for the last 12 years.

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When I was your age I was buying tailored suits from Hong Kong - I wasted the money I had, just not as much as most people, that's what you should be taking from me. I also wasted the opportunity to get ahead. If you want to be a writer, fair enough, but you won't money at it for a long time and that degree won't get you a lot of other places other than journalism.

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Originally Posted by Strike For The South

Brosideon, are you having another midlife crisis?

You posted earlier musing about how a wife and kids would be a lackluster pinnacle to your exsistance. You should take a step back and be reminded of your position in the world, of course this is not to say "think of all the starving brown people" that's a lazy, tired cliche and I bloody well hate it. It is however a reminder that life is not some sort of hollywood adventure and even Churchill had his share of boring family dinners and drab days under the hellscape otherwise known as English weather

Money is not an escape from this. Of course being financially secure is very,very important. I don't mean not to stress that but I do mean to tell you that thinking you'll play some stocks, make money hand over fist and spend your 20s living some sort of playboy lifestyle is a pipe dream.

Now speaking as a simple man with simple tastes I can say money is not overly important to me. I want enough to provide for my family and not worry about lifes little curveballs. I don't care for flash. Granted I realize not everyone is like this and I certainly don't consider it a fault if you want the oppisite kind of lifestyle. I only mean to say that should not be the fulcrum on which your life tunrs wether you end up poor or rich. Your passions should be that fulcrum. Money is an abberation and fleeting, granted it is a powerful abberation but a lot of money is just that a lot of money. It's not happiness or comfort, success or intellegince, it's just money.

Feeling insecure at this time in your life is normal. I know you posted about money but the underlying thought in all your posts is fear and insecurity, completly normal things for a young man. I see someone who respects his parents and at least has an eye towards the future and his place in the world. I say you're not doing half bad.

You have your whole life to make a fortune and lose a fortune, I suggest you start pouring your efforts into things that matter. Money is an unfortunate prerequisite for life, not the other way around

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If you make a point about not having a midlife-crisis you probably have one. Just relax, have fun. Question everything and destroy anything. Path to mercifull oblivion.

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Originally Posted by Philipvs Vallindervs Calicvla

When I was your age I was buying tailored suits from Hong Kong - I wasted the money I had, just not as much as most people, that's what you should be taking from me. I also wasted the opportunity to get ahead. If you want to be a writer, fair enough, but you won't money at it for a long time and that degree won't get you a lot of other places other than journalism.

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You are restating the advice I've been given for the last 12 years, advice I've already taken partially to heart otherwise I wouldn't be asking for advice and explanations on how to make the most of my money.

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Originally Posted by caravel

Then you have no money problems......?

(and btw I wasn't suggesting brothels)

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No I don't, but I have a sword hanging over my head that tells me that the good times will not last and I find myself less than all knowing on what I can do before it falls.
(I was joking.)

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Originally Posted by Greyblades

No I don't, but I have a sword hanging over my head that tells me that the good times will not last and I find myself less than all knowing on what I can do before it falls.

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Pfft, that's ridiculous. Being an adult is far better than being a child, juvenile, or even a young adult.

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Originally Posted by TinCow

Pfft, that's ridiculous. Being an adult is far better than being a child, juvenile, or even a young adult.

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Depends on your point of view. I certainly would like to carry on in my life not having to worry about my future and what I'm going to do with myself, but life sucks and time is impatient.

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Originally Posted by Greyblades

Depends on your point of view. I certainly would like to carry on in my life not having to worry about my future and what I'm going to do with myself, but life sucks and time is impatient.

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But that's not even true now because you're already worrying about your future. You can't avoid it because right now your future is not under your own control. You live off of the generosity of others and are not self-sufficient. That is unpleasant. Once you become self-sufficient, you'll find yourself empowered and free in a way that you never were as a dependent.

Life does not suck, it is superb; you just need to enjoy it while you've got it. There's never enough time to do everything you want, but there's time to do enough to make your satisfied.

All you can do really is follow the sound advice: Budget/Save; you will be amazed at how much flexibility those tiny measures will give you in life.

That flexibility may pay-off big someday (that's everyone's hope) or it might just allow you to cruise through some storms, which can feel like winning the lottery all on its own :)

Ride the waves.

Enjoy the little things, that way you won't be spending on the (empty) big things to fill an emotional void.

Write down the bad things, use those as grit for writing stories. Afterall a happy story isn't a dramatic one.

Budget, not only money which comes and goes but budget your time. Don't be a miser with your time, students tend to be money poor and time rich. As a writer you will get ideas from experiences. You don't need to travel the world and do extreme sports, shoot wild animals or fish for marlin to either. You do need to observe and even sometimes interact.

You want to be a creative writer so write. Write about your money worries, I'm sure there is a huge amount of equally worried people in the UK who could be your potential audience. Write about the hurdles of getting published, the downfalls of pithy rejection letters. If you have gonads of steel make a blog about your trials and tribulations.

If I told you how I make money the Secret Service and the FBI would come crashing in. But let's just say that it involves dye, paper, Chinese refugees and Chris Tucker always chasing me around saying funny black guy stuff

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Originally Posted by TinCow

Well, the first and most important step is to learn how to budget. You need to categorize your income into three separate areas. First, determine how much money you need to pay for essentials, such as food, housing, transportation, etc. Do not include any luxuries in here, only the bare minimum necessary. Second, set yourself a specific level of savings to put away for the future. More on this later, but a good rule of thumb is 10% of your income. So, with an income of 500 GBP per month, this would be 50 GBP. Third, everything else left over is your disposable income. If you do not already have them, open two bank accounts, a checking account and a savings account. Every month, deposit 450 GBP into the checking account and 50 GBP into the savings account. Ignore the savings account for now; pretend it doesn't exist. Pay your bills exclusively from checking. Your disposable income will remain in checking and will slowly accumulate. You can do multiple things with your disposable income. First, you can spend it on luxuries, like entertainment, a good meal, or some nice item or piece of clothing which is not covered by your essentials. Second, you can save it for bigger luxuries. For example, you might want to buy a new computer which costs 1000 GBP. Obviously one month's of disposable income is not enough to pay for this. So, don't spend your disposable income for several months and instead save it up. When you've got enough got the computer, then you buy it. Third, make larger than normal deposits into savings.

Do not run up debt. Credit cards are good things, and I recommend using them. They are easier than carrying around cash, will build a credit record for you (which is important in future years), and you can even save money with them if you've got a card that gives you some kind of cash-back or reward system. The important thing, though, is to NEVER run a balance on the card. Always pay the balance of the card in full every month. If you do this, the credit card costs you nothing (avoid annual fee cards like AMEX, you don't need them). If you cannot afford something based on the amount of money in your checking account, you just don't buy it.

Continue this way until your savings account has enough money in it to allow you to live off of that account with no other source of income for six months. That money is now your emergency fund, and you will never touch it. It exists to bail you out of bad situations, such as unemployment or unexpected medical expenses. It is a safety net for your financial life, and you should always keep it safe in a savings account and never invest it or put it someplace where you cannot access it immediately and in full. From this point on, your monthly savings can instead be diverted into investments. These are the stocks and bonds that you hear so much about. There is a lot to learn about this stuff, but you're still at the beginning of the process so you don't need to worry about it yet. When you get there, find someone who's knowledgeable about it and pick their brains. As your income level increases, your lifestyle will increase as well and you should regularly rebalance the 'essentials' and the savings to ensure that they keep up with your means and your needs. Also make sure that your six-month emergency fund remains a six-month fund. If your lifestyle has changed such that your emergency fund will now only cover four months of living, you need to spend some time topping it up again. You also want to immediately top it up if you ever have to take money out of it.

Above all, do not go into debt for unnecessary things. You will probably need a loan to buy a house or a car, but those are special cases and worthy of their own discussion. Other than that, if you cannot pay for the item in full, do not buy it.

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This exactly the advice I wanted to give, but I was too lazy to type it. Excellent post :bow:

The six month rule is golden and very important to keep in mind for the rest of your life. Living as if you don't have a savings account is another golden rule.

Next to stocks and bonds, you may also want to look if your country gives fiscal stimuli for certain types of investments. In Belgium, for instance, you get an important fiscal stimulus if you put money into a pension fund/life insurance. There's a stimulus for acquiring a house and from time to time, there are stimuli for certain investments to improve your home. You also always have to look out for taxes; the profits you make on some products are taxed, others are not. Once you're going to get into it, it'll feel like a whole new world opening for you.

I wouldn't put too much trust in professionals though, certainly not when they are busy trying to sell you products or when they themselves are working for a financial organisation. Listen to them, pick up a few things but educate yourself on the subject as well; never decide on the spot, but go back home first, look a few things up and then decide if you're going to follow the advice they gave you.

For instance: some banks will try to talk you into funds organised by themselves. They promise you an expected return of investment of 5 to 6 % which is good nowadays, certainly if you don't have to do anything yourself but transferring money. However, what they sometimes don't tell you, is that there's an annual fee to pay when you step into the fund and you return goes down with a percentage. Then there's also a cost to step into the fund; again 1,5 % gone. Etc. Read everything before you sign into something.

Power Ball is up to $550 million: http://www.powerball.com/pb_home.asp

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Originally Posted by Gelatinous Cube

I would literally poop myself if I won that kind of money. :bounce:

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I won the PowerBall! Literally! I only got the PowerBall number, none of the rest match. :shame:

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Originally Posted by Vladimir

I won the PowerBall! Literally! I only got the PowerBall number, none of the rest match. :shame:

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That's what Hitler said. :smoking:

invest it in gambling.

Well... I've been thinking over the last 2 days, there was this chinese buffet that had recently closed near me, maybe I should get a loan; buy it, open a restraunt. It's a really good area: it's part of the bus station across the road from the rail station, 15 minutes from the mainstreet and there's a mini tesco right next to it. high traffic and easy access to food if we run out some nights, I could see it paying itself off in a year or two.
Worth thinking about, I guess, though it will probably require loads of night classes on management.

Spoiler Alert, click show to read: 

well, I do anything really: jobs, commissions, writing blogs, being a youtube partner (yes, I am one), etc. Not that anything ever pays off is this age.

of course, I never get to enjoy what little money I make, since all of it goes to fill the "crater"--my now closed bank account. closed on account of me bailing out my mom, who cannot plan her flights (or anything really) properly, so makes me pay for her final leg of the journey home--with money I was supposed to save to move to a place where I can find some sort of decent work. brilliant. And to cover her rear, she blames me for it all, because I accidentally opened the courtesy payment option on my old account, even though had I not done so, she wouldn't have returned home in the first place. And she seems to be just fine leaving me to rot with no ability to open a new account (the banks are jerks that way). She cites her financial problems, though really, half her problems would be over if she just payed the darn thing off for me.

And of course, having little experience, I can't get a job as a geologist/mud-logger/anything (even though a BSc would have been enough just a year ago), and with no bank account, I can't even receive money for any other line of work, making matters even worse (since my bank account is closed, and no one wants to hire a person with that issue--I suspect).

so my total income is nowadays about 1,500-3,000 dollars a year. Not exactly enough to go by with. or pay for graduate school (which is a must if I'm to be guaranteed work), or even to begin paying off the 30,000 dollars of debt incurred wasting my time in University for a worthless sheet of paper telling people I can do Geology...

unsurprisingly, I feel like I want to wrap my lips round a glock. Not that I do, as some part of me tells me not to give up: even though every logical part of my brain says I'm screwed.

so, basically, don't live in the US, and if you do, don't waste your time on college, kill off anyone close to you before they start sucking the money off of you, and start your own business if you can. Oh, and don't go into debt. ever. And don't vote for any clown from either party.

So now you know why I haven't been posting much lately at the EB forums, or here.

EDIT@ greyblades: my advice for you, since things are working out better for you, is just be careful with what you spend, don't use gas when you can walk (bicycles are fine, but walking is best for short distances), and see if you can find work as an intern or something (what is your major by the way?). I'd throw out your TV, any but the smallest fridges, and make do with no heating/AC (I hope your place has curtains and not blinds?). Internet should be basic, and your phone plan minimal, and with the cheapest company. don't listen to those get rich quick adverts, especially online, and avoid having to use credit cards.

and work hard in school, that way more scholarships come* (in theory), and you won't have to take out as big a loan. Finally, make sure that you gradually phase out having to get paid from your parents--even if you are still in college. It'll come back to haunt you, if my experience is a clue (I did for one year, then the last two years didn't have parental support, but that one year meant my mom is now on my head to pay her off). Also invest in things that won't lose value (better yet, something whose value will go up)--and it had best be physical, and not stocks. with the currency situation in Europe and the Americas, it's a good idea in the long run.

finally, keep looking for more and better work. I'm sure you'll find something (hey, everyone I know ends up doing well: I'm the only one left. maybe I'm a good luck charm-thingy to people around me?)

*to make that possible while having good work, set yourself at a slow pace: in the US, it's by credit-hour, so over here, I'd recommend 12-15 hours maximum (lowermost full-time: you're more likely to get scholarships). I don't know how it works in the UK, but do the equivalent.

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Originally Posted by Greyblades

I dont have a reluctance to work (well, yes I do due to being a lazy little sod but that's besides the point) I have a reluctance to talk about work because I already know all I want or need to about jobs due to being brought up in an education system aimed at sticking me in a career, I had my life almost derailed through them devoting 3 weeks sticking me into work experience.
I'm young! I think careers will be soul destroying and I still have delusions of getting rich, and noone makes a billion dollars on a career. I want to know about the alternatives I didn't even think existed 3 years ago.

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don't kid yourself, you will be working if you want to be eating.

first, don't think about the money. think about the work. what is it you would enjoy doing. do that. then do it for the most money you can and learn to live within your means.