The Time I Sold A Blog To Pay Off Mortgage And Didn’t

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In December 2007 things felt gloomy. The economy was rocky and if you looked around closely enough signs of an impending slow-down were there.

No one can predict the exact moment when the balloon will burst, but the sense of foreboding was palpable.

I sat down at my laptop one night, while trying to help my son fall asleep, and began writing about the importance of living a frugal life.

At the time I wrote mostly for cathartic reasons, and I continued to do so for the next few months.

My wife and mother were my only reader.  In the spring of 2008 something changed.

I started getting traffic to my little frugal blog. A few popular blogs picked up an article I wrote about a Square Foot Gardening project I did with my kids.

I knew nothing at the time about analytics or monetization or social media (in fact, I think Twitter was just getting started and Facebook was still something only college students used).

Google Adsense was my only form of monetization, and up to that point had barely covered the cost of hosting the blog. At the time I was just happy to break even.

A Year of Explosive Growth and Personal Sadness

From Spring 2008 until Fall 2009 a lot happened in my life:

  • My blog experienced explosive growth
  • I received hundreds of thousands of page views
  • I (sort of)  figured out monetization
  • My subscriber count climbed above 20,000
  • My blog appeared in national print magazines and newspapers
  • I was interviewed by a couple of radio stations

It was surreal. Other than close family nobody else knew what I was doing. I didn’t share any of my success at work or with friends. back in February 2008

I enjoyed the anonymity of it, but I knew eventually word would get out. Interviewers asked for my real name. Eventually someone would make the connection.

But that time was not all good. I battled some serious personal sadness. I lost my mom in 2009, and my dad in 2010, both after year-long illnesses.

My mother had an aneurysm and stroke at 52 years-old and was wheelchair-bound the final year of her life. My grandfather (and father-figure, mentor and best man at my wedding) developed lung cancer and died six months after diagnosis.

Watching my mentor, a former Marine fighter pilot and one of the toughest men I knew, wither away devastated me.  Losing my mom, my best friend, and one of the strongest single mothers I’ve known was especially hard.

In less than 12 months I felt like I had lost my entire personal “fan club.” I had no brothers or sisters to help shoulder the burden. I did have an incredibly supportive wife and children which helped me through that time, but the depression that set in was overwhelming.

In hindsight, I did not handle it well.

Getting Back Up On the Horse

I eventually got around to blogging again, but my heart was not into it.  At least not in the way it had been before.

Thanks to some fellow bloggers I was never short on content; they submitted over two dozen guest posts to give me time to get my feet back under me.

I always appreciated the kindness people, strangers in that we had never met in person, showed to me in such a time of grief.  I still find the personal finance blogging community to be made up by great people!

An Offer To Buy

Things were never the same. I floundered for another six months when out of the blue I received an email about someone interested in buying my blog.

I had received offers before, but nothing ever materialized and if I’m honest, I never really wanted to sell.

This time I entertained an offer.

After some negotiation I had a long talk with my wife, we prayed about it, and ultimately we decided to let it go. We would take the proceeds from our blog sale and pay off the mortgage.

The process of selling the blog was not particularly easy, and part of the deal was that I would stay on and continue to write for another year.

I did not want to continue writing at the time, but could not convince the buyer to do the deal without me continuing to write. I understand they wanted continuity in the blog’s voice.  I just wanted out.

Parking the Money

The money from the sale was parked in a money market fund. Beyond paying off credit card debt, and adding a little to savings, I did not really know what to do with it.

Paying off the mortgage seemed like a good idea, but now that I had this cash buffer I didn’t want to draw it all down at once; even to be mortgage debt free.

I agonized over the decision. Not having a monthly mortgage payment sounded awfully nice, but so did having a giant emergency fund, particularly since I no longer had an income from side hustling.

For the next year I suffered from a bad case of “paralysis by analysis.” We did use the money for some fun stuff, including our first trip to Disney World.  But for the most part it sat.

Beware Lifestyle Creep

Over the next couple of years life continued to happen. Broken arms, illnesses, various emergencies and broken vehicles and air conditioners put a dent in our savings.

Looking back the biggest mistake we made was beginning to supplement our income by pulling from savings.

“Lifestyle creep is a funny thing; it overtakes you slowly.”

You start to use credit cards again.

You start to eat our more and at nicer restaurants.

You shop for a new sofa and things for your house that you have neglected for years while paying off debt.

You stop being hungry and start growing content.

Eventually, the “giant” emergency fund was whittled down to a very modest one.

Spending continued.

Sleepless nights resumed.

I could not believe where we were, financially. If you think being in debt is bad, imagine getting out only to go back in.  It is soul-crushing.

The good news to this cautionary tale is we recognized what was happening before our finances again became a total disaster.

We are now more mindful of our money, and though we have given up budgeting, we have not given up things like planning meals and looking for cash back deals.

I got the blogging bug again and decided to restart Debt Reckoning, a blog I started just after selling Frugal Dad, but never really put the proper effort into growing.

Lessons Learned from Selling My Blog

So what lessons can I share from my experience? Plenty.

1. Always have an exit strategy. If you are in business for yourself always have an exit strategy. Don’t ever be caught off guard by an offer to buy your business.

Keep a number in mind, maybe a multiple of monthly or annual revenues with which you could live if offered up for your business.

2. Negotiate for as much money up front. Often times those looking to buy a blog want to spread out the transaction in installments hoping to offset future costs of the sale by reaping revenues from their newly acquired business.

I get that, but it doesn’t help your bottom line in the near future.  Gordon Gekko always seemed to get what he wanted.  Be Gordon Gekko.

3. Get tax advice and save enough to cover taxes in a separate account. After meeting with a tax advisor and agreeing on an estimated amount I would owe I parked that money in a “Tax” sinking fund at our online savings account until it was time to pay the IRS.

4. Have clear goals for the proceeds and follow them. Those of us who work for a living are not accustomed to receiving anything larger than a biweekly paycheck and we tend to panic when we see a larger amount of money.

Immediately, you feel like you should be doing something with it. But then almost just as quickly you don’t want to do anything with it.

Have a plan and stick to it.

5. Invest some of the money in a passive income vehicle. The sale of my blog meant an end to monthly side income. I underestimated how impactful that would be to our monthly cash flow.

I wish I had taken some of the proceeds and invested in rental real estate, or even bought other web properties to manage which continued to generate an income. Recurring side hustle income is very powerful.

6. Ask yourself if you will be happy after the sale. Remove finances from the equation. Will you miss doing what it is you do now? I thought I never would, but I did.

My decision was heavily influenced by timing. Had it not been for the death of my parents, and the resulting lack of motivation, perhaps I would have held on.

Who knows if that would have been the right decision. I am where I am because of those decisions and I try to live with no regrets.

The Time I Sold a Blog to Pay Off My Mortgage (But Didn't) - lots of lessons learned here!

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