How do I know this? It's in bold type in the top right-hand corner of his Web log, MyMoneyBlog.com, where Ping keeps a daily tally of his progress. He's one of more than 150 bloggers, mostly 22 to 35, who have adopted an open-source approach to personal finance. Most keep their names secret, but that's about all they hide. In stark contrast to their parents' generation, for whom comparing incomes can be awkward, if not downright taboo, bloggers list financial information down to the dollar in retirement, brokerage, and savings accounts. They recommend investments, decry credit-card debt, and wallow together over high taxes, commenting on one another's postings and leaving behind a road map for financial voyeurs. Ping writes: "If I mess up, you'll know. If I come across a neat way to make or save money, you'll read about it here...hopefully we'll learn from each other and meet up in the Caymans some day."
I admit, I'm really into monetary voyeurism right now. I'm 30, and from what I hear, my generation is financially hamstrung. Books such as Tamara Draut's Strapped and Anya Kamenetz' Generation Debt: Why Now is a Terrible Time to be Young and articles like BusinessWeek's "Thirty and Broke" (Special Report, Nov. 14, 2005) call attention to financial problems that plague us: sizable student loans, credit-card debt, a tight job market, and skyrocketing housing prices. Everyone from money doyenne Suze Orman (The Money Book for the Young, Fabulous, & Broke) to humorist Dave Barry (Dave Barry's Money Secrets) has weighed in. Yet a growing number of young professionals are bypassing pros in favor of Ping and his merry band of bloggers.
It's an approach to financial advice that appeals to a do-it-yourself generation steeped in content we have created ourselves. We enjoy reality TV as much as scripted dramas. We are as likely to watch our friends' video clips as we are music videos. We trust bloggers as much as, and sometimes more than, journalists. So when it comes to financial advice, why rely on experts when we can sift through the blogosphere to find folks roughly our age making roughly the same choices we make and let them be our guides?AT YOUR OWN RISK
Money bloggers range from the Chicago couple chronicling their climb out of $98,615.39 in debt on Makelovenotdebt.com to wealthy NYC Money, 26, who posts about a $743k nest egg on nycmoney.iblogs.com.
To be sure, they get things wrong sometimes, and unlike the experts, they aren't required to disclose conflicts of interest. But most put forth some variation of the caveat offered by Madame X of myopenwallet.blogspot.com: "If you take any of my advice, do so at your own risk, as I am not really qualified to give it."
Ping started MyMoneyBlog.com in December, 2004. Having finished a master's in engineering at the University of California at Berkeley and taken an insurance company job, he finally had more than $500 in the bank. He first used the blog to ask advice about where to invest his 401(k). Managing money became an addictive hobby. Over 14 months of daily posts he has amassed a readership that relies on his personal research about which online savings accounts offer the best promotions (check out HSBC's (HBC
) fine print for a 4.8% interest rate) and what credit cards offer the best incentives (Citi (C
) Professional MasterCard throws in a $100 gift card).
He has become an informal advice columnist as folks e-mail him scenarios like this: "I finally got a stable job. I have $9,000 in credit-card debt, half at 12.99% and half at 8.99% APR. I have no emergency funds at all. Should I pay down the credit cards, or should I build a backup money fund?" Ping often posts the question along with his suggestions and invites readers to add their thoughts. After 16 readers commented on this Feb. 6 entry, the consensus was that the inquirer should get rid of high-interest debt first.
While Ping sticks to the numbers, Boston blogger Jane Dough weaves more of her personal life into the chronicles on Bostongalsopenwallet.blogspot.com: "Speaking publicly about your personal finances has always been a no-no in my family," Dough writes in a three-part essay tracing her beliefs about money to a middle-class childhood growing up as the youngest of five children of divorced parents. A single woman of 35, Dough figures she needs $3,376,500 to provide her 25 times what she'll need to live on annually ($135,060, adjusting for inflation) in retirement. She's at $366,111.12. Readers enjoy her musings on women and real estate, fabulous online sales, and why it makes sense to give a kid $30 to shovel a snowy driveway.
An open-source money trail also allows you to avoid mistakes by watching fellow bloggers make them. Take 2million, a 29-year-old IBM (IBM
) engineer in Raleigh, N.C., who played arbitrage with cash advances on credit cards offering 0% annual rates. He took out large sums on four cards and invested the money in high-yield savings accounts. His idea was to profit from the interest and return the cash when the 0% offers expired. He estimated he could make $700 off the interest over the course of a year. Good idea, until he discovered his credit score fell to 687 from 780, disqualifying him from the best mortgage rates.
After keeping tabs on these bloggers, you may want in on the game yourself. That's why a group of Web developers in Portland, Ore., recently launched Networthiq.com, a social networking Web site still in beta that is for money fanatics what MySpace (NWS
) has become for the music-obsessed. Users sign up and create profiles based on their net worth. They can then compare themselves with others by age, income, job, or geographic location, link to other users, and track their progress on a blog.
Meanwhile, what began as a hobby and a tool for Ping has become a profitable enterprise. He now makes more than $1,000 a month off the Google (GOOG
) AdSense ads that bloggers can install for free, and he gets some income from referrals. Recently he picked up a $10 bonus for directing me to my new savings account with ING (with an interest rate of 4.75%). I got a $25 signing bonus for accepting his referral. I'll use it to buy him a drink when we all get to the Caymans. By Jessi Hempel