Frank Talk on Finances
Laying bare their money secrets, bloggers trade strategies for retirement. Many are young. A few even make a buck
It isn't easy to talk about money. When Jonathan Ping graduated from college and married, he finally achieved a steady stream of income. But his head became filled with questions like, "Should I open a Roth IRA? Which broker is best? What funds should I buy? Should I pay down my student loans first?"-topics he didn't feel comfortable discussing over dinner or at work. So, Ping, a 28-year-old computer science student and part-time research assistant in Portland, Ore., started My Money Blog to converse with like-minded people about one of his favorite subjects-financial planning for retirement.
Like Ping, baby boomers and generation X-ers-many of them still decades away from retiring-are finding that articulating retirement goals online helps them organize and stick to their retirement plans. "I think most bloggers started doing so because they didn't get the information and/or interaction they needed from their coworkers or friends," says Ping, who has been blogging for two years. "Online I can ask for additional details or why someone chose one investment over another."
Worth. Some bloggers regularly calculate their net worth and their attempts to make it grow. "Just the virtue of documenting my journey and recording my success and failures along the way helps me," says Brian Jaeger, 30, a Raleigh, N.C., engineer who writes 2 Million, a blog named for his goal of amassing a net worth of $2 million. "I record monthly my net worth, and the process ... has really helped me tune my actions toward making progress toward my goals. I have no excuses. It's all out there, and it really helps me own up to my mistakes."
For his part, Ping is actively increasing his net worth as well. "The blog helps with motivation," Ping says. "Some months, if I spend too much money and didn't save enough, then I have to blog about it and explain myself."
By having an open and honest conversation about money, many bloggers are earning dollars, too. John Nardini, the 42-year-old author of the popular Free Money Finance blog, says he makes from $20,000 to $30,000 a year by hosting advertising on his site. He donates the proceeds to charity. However, most bloggers make only a few hundred dollars or less each month from paid advertisements on their blogs. It's not big money, but it's extra cash for which they don't have to commute to earn.
And the perks aren't bad either. Some companies promote their books, DVDs, and products by sending them to well-known bloggers in hopes they will write about them online. "Sometimes when a company comes out with a new product, they'll actually tell bloggers ahead of time and use buzz marketing to promote their products," says Ping. "A lot of book publishers have contacted me so I can review" works about to be published.
Starting a blog just for a little cash and free stuff might be a mistake, though. Blogging daily is a big commitment. Only about 55 percent of all blogs have been updated even once in the past three months, according to Technorati, a company that tracks 63 million blogs. The rest are either neglected or abandoned. Many people write enthusiastically for the first several weeks. Then their posts become more and more infrequent. "Finding the time to really make a commitment to it can be a challenge," says Lori Woehrle, 48, the Washington, D.C.-based author of Tuna on Rye, a blog about "the sandwich generation" of people who are struggling to raise their own children, care for elders, and plan for retirement at the same time. Woehrle faithfully sets aside an hour each night to blog after her daughter is in bed.
Freshness. "Typically, the bloggers who post very regularly and every day are the ones who have the most loyal and consistent audiences and are therefore most attractive to advertisers," says Derek Gordon, Technorati's vice president of marketing. But even if you don't have time to blog every day, you can maintain an audience. "If you don't post anything on a weekly basis, you're still OK," says Esteban Kolsky, an analyst for the technology research firm Gartner. "But once you get into the 10-days-to-two-weeks time frame [without posting], people stop paying attention to your blog."
Picking the right topic is key. "Find a subject that you feel passionately about, and don't focus as much on making money," advises Jeff Hanson, 42, a partner with Ohio Innovation Fund in Omaha and the author of the blog Your Way Ahead. "I think if you go into it with the intention of making money, people will see that."
Spoils from blogging might not seem so lucrative once you consider the time a blog requires. "I once sat down and added up how many hours I have put into the blog, and it's basically less than minimum wage," says Ping, who estimates he makes over $1,000 a month from his blog. "But if you have a passion for it and would do it anyway, why not?"
The bloggers who stick with it often find themselves to be part of a new kind of Internet community. "People think of bloggers as being these lonely people in pajamas who toil away at their computers all day long, but they are engaged and connected and really conducting two-way dialogues," says Gordon. Many personal-finance bloggers link to one another's websites and regularly comment on other blogs. Some even talk on the phone, although none of those interviewed have met a fellow retirement blogger in person. "I try to make it interactive and make people want to come and share ideas," says Jeffrey Pritchard, 37, a financial planner in Beaumont, Texas, and author of the All Financial Matters blog. "Some topics will get 20 or 30 comments from different people weighing in."
As bloggers discuss investment decisions they are considering, commentators aren't usually shy about giving a thumbs down to what they think is a bad move. "If you get something wrong, people will let you know," says Nardini, who is part of a six-member group of blogs called the Money Blog Network. They have banded together to share ideas and market their blogs to advertisers, so far attracting national sponsorships from H&R Block and Nationwide.
Jaeger actively seeks comments and criticisms from people all over the world about financial quandaries, like his recent $3,500 investment in an emerging market fund. One commentator called it a "wise investment," while others posed questions about the fund, offered their own international picks, or reminded him to diversify his assets. "I certainly wasn't an expert when I started this, and I'm not an expert now," Jaeger says, "but I get a lot of feedback about whether something is a good idea."
Secrets. Not all bloggers are keen to expose their finances using their real names. For some, part of the mystique of blogging is keeping their identity secret as they share details about their salaries, investments, and personal money decisions. The author of Tired But Happy, a 30-year-old Philadelphia librarian who asked that her name not be used, enjoys reading about the financial decisions of other bloggers, comparing herself with them, and writing on her blog about money matters that are confusing or scary. But she prefers to do so anonymously. "My blog is a family finance blog where I write about what it's like to be in a relationship with someone who relates to money in a different way than I do," she says. "I couldn't write as honestly about this stuff as I do if I knew my grandmother was going to read it."
Ping's blog, on the other hand, is regularly read by his wife and relatives. "Now that my parents know about it, they read it as a way to keep in touch with my life," says Ping. His parents tell him, "You never call, so all we really know about you is what you write in your blog."
Other bloggers are worried that what they write might hurt them at work. "There's a lot of personal information I put up there," says the 30-year-old author of Consumerism Commentary, who works for a financial services company in central New Jersey and likes to be known by his nickname, Flexo. "In the past, I've written about looking for jobs. I wouldn't feel terribly comfortable if the people I work with knew about it."
But Nardini, the executive vice president of Denali Flavors, a Wayland, Mich., company that invents and markets specialty ice cream, found his employer to be blog-friendly. He even blogs from work with his boss's OK. "My company makes Moose Tracks ice cream, something totally unrelated to personal finance," Nardini says. "But it has allowed me to blog in exchange for the primary sponsorship position on the blog."
All Money Talk, All the Time
AllFinancialMatters.com. A financial planner discusses 401(k)'s, IRAs, asset allocation, and portfolio management.
ConsumerismCommentary.com. To hold himself accountable for spending money, a man keeps a public record of his net worth.
FreeMoneyFinance.com. This blogger dispenses practical advice on maximizing income, curbing expenses, and amassing wealth.
2MillionBlog.com. Pledging to save $2 million by age 45, a 30-year-old chronicles his journey toward financial freedom.
MoneyBlogNetwork.com. Six popular personal finance bloggers join forces in trying to improve their bottom lines.
MyMoneyBlog.com. This 20-something strives to make more money, spend less, and manage his finances.
TiredButHappy.blogspot.com. A librarian muses about money matters within relationships and families.
seniorcare-dc.blogspot.com. Child rearing, elder care, and retirement planning have Tuna on Rye's author "sandwiched."
YourWayAhead.com/blog. A baby boomer discusses ideas and plans for a financially sound retirement.
This story appears in the February 12, 2007 print edition of U.S. News & World Report.