small change toward a rich life

Make Money Online Fast (Not): an ethical dilemma

I don’t usually talk about the money-making aspect of blogging, but I’m going to make an exception, by way of explaining a few changes taking place around here.

Late last year I decided that I want two things from Pocketmint.

One, I want to help people and make a positive difference in their lives. I’m seeing some evidence these days that I’m doing that, which makes me happy.

And two, I want to make a living. A very small living. Maybe even just part of a living, if I can successfully leverage some of my other skills as well.

But zero is no good, not if I want to stay off the corporate treadmill. And I do, desperately. I don’t want to go back to the life where I need anti-anxiety pills just to get through a workday.

The reality is that I can’t keep writing Pocketmint indefinitely if it doesn’t contribute some income. The research, writing, and editing takes a lot of time, time that I’ll need to spend on some other endeavor that will help pay the bills.

•   •   •

If you read many personal finance blogs, and certainly if you have one, you probably can guess how most pf bloggers make their money: advertising.

But you might be surprised to learn that the ubiquitous Google Adsense blocks bring in only a few dollars per month for most people — at best, a few hundred.

pile of Chase credit card offersNo, by far the most lucrative way to advertise, if you have a personal finance web site, is to become a megabank affiliate and start driving people to sign up for credit cards. Each new customer means a hundred bucks in the blogger’s pocket.

For example, look at this graph from Mr. Money Mustache: the moment he put credit card offers on his site, his revenue shot up. He started pulling in around $4000 per month just from credit card signups: around 90% of his total blog profit.

Or go to a commercial personal finance site like Get Rich Slowly and look at the ads in the sidebar. No AdSense in sight. Two savings products from different megabanks, some auto insurance, and a crapload of credit card offers. So many that they don’t even fit them all on the page but have an animation to rotate through them. You can bet that QuinStreet, which owns GRS and several other properties, is maximizing its advertising revenue.

Credit cards are where the big pf blogging money is at.

•   •   •

Last week, the utterly awesome Consumer Financial Protection Bureau showed its teeth for the first time, forcing megabank Capital One to pay $140 million to its credit card holders in restitution for its deceptive marketing tactics.

Capital One bank signCapital One had been pushing add-on products — credit monitoring and ‘payment protection’ services — to its cardholders. Services which are of little or no value to any consumer, ever, and cost between $120 and $300 a year.

But making billions of dollars selling useless services wasn’t enough. Greedy Capital One was also:

  • collecting fees from people who weren’t eligible for the services and so would never see any kind of benefit, however paltry,
  • telling some cardholders that these fees and services were required for everyone,
  • telling others that the services were free (and then billing them anyway),
  • signing up some people without their knowledge at all, and
  • giving the runaround to anyone who tried to cancel the services.

Capital One is not alone in this; they’re merely the first to be called out on a national scale. The entire banking and credit industry is built upon similar practices, and many more unethical tactics besides. (See also: LIBOR manipulation.)

It’s not just about credit cards, either. I’ve come to realize that almost all of the financial products and services on the market are toxic. They don’t just fail to help people, but they actively seek to trap them and bleed them dry.

If marketing were honest, the selling point for the best financial products would be ‘Will Only Hurt a Little’.

•   •   •

Here’s the problem: I cannot seem to bring myself to advertise credit cards and other financial moneymakers that I believe harm the very people I’m trying to help.*

Don’t think I didn’t seriously consider it: I mean, $4000 a month? That would support my entire family in one of America’s most expensive cities. With some savings included. In a few years, when we’re no longer locked into Seattle, Jak and I together could live extremely well on half that much.

But I have an ethical streak that’s a mile wide. I can’t even post Amazon affiliate links on my book recommendations without reminding people that they should really use their public library instead. (And as you might expect, I’m not exactly raking in the Amazon income.)

girl with Kick Me! sign on her backThis is arguably a flaw — it’s one of the main reasons I repeatedly get chewed up by corporate cultures, where exhibiting ethics is effectively like taping a ‘Kick Me’ sign to your own back.

Believe me, I am not bringing this up to brag. It may in fact be stone-stupid of me. And it’s not a condemnation of other bloggers who’ve made a different choice.

But it’s who I am, who I’ve always been. And after much thought I’ve concluded that the emotional cost of failing to uphold my values would be greater than any amount of income could compensate for.

So okay. I’ve considered advertising, and discarded it. No credit card affiliate links, not even AdSense — because what shows up in AdSense is mostly toxic crap as well. What are my other options?

* Yes, it is possible to use a credit card, dance around the many traps, and come out ahead. But it’s not easy. Statistically, nearly everyone loses except the banks — the game is as rigged as any casino. And the fact that it’s possible doesn’t mean I should push people to go out and try it, any more than I would recommend that everyone quit their jobs and go play blackjack for a living.

•   •   •

tip mug with text: Tipping isn't just for cows!Well, first of all, there are donations. Earlier this month I added tip buttons to my site. Tip the Web is a nonprofit, with a business model that itself runs off tips, so (unlike, say, Paypal) they’re not out to screw either the giver or the receiver. You can donate a dime or a dollar — anything you want, really. (You have to chip in at least five dollars total, but you can spread that out among a hundred different sites if you prefer.) If something I write inspires you, or helps you save some money, you can throw me a bone. If you feel like it.

I may even remind you from time to time that tipping is an option. Call it the public radio model of blogging. Hey, I send NPR money every year.

•   •   •

Second, there are a few — very, very few — products and services that I can honestly recommend. I’ve started up a ‘resources’ page, which will list stuff that I firmly believe is both a) useful and b) not harmful. Possibly with extra caveat emptors, as required. A tiny percentage of those things will also c) make me a infinitesimal amount of money.

Infinitesimal because, not coincidentally, companies that are not screwing their customers right and left rarely offer large bounties to people bringing them new suckers customers, so I’m not expecting this to improve my bottom line much. However, I’m including it on the principle of ‘every little bit helps’.

•   •   •

Finally, there’s charging for my writing.

That was a stupidly difficult sentence to write. I feel like I’ve broken some sort of unspoken personal finance blogging taboo.

Shilling for predatory banks? Totally acceptable! Getting paid to write about interesting stories and helpful ideas? Not Done!*

I have to remind myself that the going rate for professional non-fiction is between 25 cents and a dollar per word. If I were paid for Pocketmint directly, I’d be making at least several hundred and possibly over a thousand dollars per week.

No, I’m not going to put Pocketmint behind a paywall. That would be counterproductive.

library display of personal finance booksHowever, what I have decided to do is write a personal finance book. And then another one. And maybe even another one after that.

And I’m going to sell those books for actual money.

* Well, it is occasionally done. Leo Babuta did it, and Chris Guillebeau, to name two. But they’re ‘lifestyle design’ bloggers, not personal finance bloggers. Still, their examples give me some hope that I can support myself without selling out.

•   •   •

Back in January and February I wrote a series of four lengthy posts explaining the Conflict-Free Family Budget that I had developed for our own household. Nearly six months later, I’ve started to get a few emails from people who’ve tried it — ones where they say ‘thank you, this changed my life’. This makes me — well, first of all, thrilled — but also leads me to think the CFFB might be worthy of a larger audience. And valuable enough to charge for.

So the expanded version of The Conflict-Free Family Budget will be my first full-length book project. I want to go into some of the background and details that I previously glossed over because I was already pushing the limits of blog-post length.

I started working on the outline and additional research two weeks ago. I am aiming to be done with the text by (…deep breath…) January and release the completed book in Spring 2013.

If you’d like to be notified when the book is available, sign up here. I can promise that mailing list members will get first crack and a nice discount off the public price.

Oh, and if you’ve enjoyed Pocketmint for a while now and want to drop a dollar in my hat, hit that little green Tip button below.

And thank you all for your support — financial and otherwise. I hope to keep writing here for a long time.


11 responses

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  1. Rosie says

    I think a book is a fabulous idea! Can’t wait to hear more about it.

  2. Abby says

    Awesome idea!!

  3. Cindy says


  4. Karawynn says

    Thanks for the support! :)

  5. karina says

    I think its easier to have a book in conjunction with a blog cause then the blog would serve as a platform for promotion

    Good luck and thanks for your honesty!

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