In Q4 of this year, we brought in over $100,000 from our YouTube channel and other related income streams! Yes, that feels as crazy for me to type as it does for you to read. However, it hasn’t always been this way. If this is your first time ever reading one of our income and expense reports, I suggest starting with the first one we ever published in July of 2016 (our total income was $603.26)
Now that we’re making what feels like a crazy amount of money from this business, I feel like it’s important to tell you why we started writing these reports in the first place and why I am continuing to write them (at least until we hit our goal of 100 countries).
When we first made these reports in our 6th month of full-time travel, the goal was to make enough money to cover our travel expenses so we could continue traveling. The purpose was to document that journey. We thought that if we were successful, maybe we could inspire some other people along the way to go after a crazy dream of their own.
When Kara and I used to tell people we traveled full-time, we’d almost always get the same response: “I wish I could do that.” At that point in the conversation, I would usually just bite my tongue. I realize that for some, full-time travel truly isn’t possible. But for most of the people who say “I wish I could do that,” they could if they really wanted to. Yes, some people would have to work harder than others, but most people could make it happen if they were willing to make travel a priority.
One of the selfish reasons we started these reports was to show people that we weren’t trust fund kids and to prove to them that travel doesn’t have to be expensive. We were sharing the exact numbers behind how 2 people could travel the world for a year for $35,000. The hope was that, down the road, we could also show how it was possible to start a business while traveling that would continue to fund our travels, but it was just a dream at that point.
Fast forward 3 years, and we can’t believe where that dream has taken us!
And because of this path we’ve found ourselves on, I feel like the purpose of these income and expense reports have shifted. When we started, I felt like the numbers we were sharing were very relatable to the average person who wanted to go and travel. We were writing as 2 broke newlyweds, and the reports proved that you didn’t need a lot of money to go travel.
Now, I feel like these reports have become much less relatable from a travel expense standpoint, and they aren’t serving their original purpose. I’ve been going back and forth on whether or not to continue publishing, and I’ve almost quit a couple of times. However, I’ve recently realized that these reports are now serving a different purpose that I never intended them to serve.
Based on the feedback I’ve received from the last few reports, these reports are inspiring others outside of the realm of travel to pursue whatever they’re passionate about. This is really special to me. I’ve known from the beginning that it’s not everyone’s dream to travel (I have family and friends who would hate living a week in our shoes). That’s why I’ve never wanted to preach “everyone should travel full-time or you aren’t living life to the fullest.”
I don’t believe that, but I do believe far too many people get swept up in the current of life and just end up wherever it takes them. Then, they look up one day and wonder how they got there. If I can inspire people to at least think about what they really want in life and encourage them to start pursuing it some way, I consider that a success.
So I am going to continue writing these reports (at least until we hit 100 countries) to show people a real-life case study about two people who went against the grain to pursue something they were really passionate about, and it worked out better than they ever could have imagined.
I think most people think you have to make a choice between pursuing your passion or making money. We’re proof that it doesn’t have to be one or the other. We didn’t go into this thinking we were going to start a successful business. We just wanted to have enough money to continue traveling. But because we started doing what we really enjoyed, and worked really hard at it, we’ve found ourselves somewhere we never dreamed of being.
This introduction has become much longer than I intended. So, in summary, I now hope these reports inspire people to work hard at pursuing their passion because you never know where it will lead.
So without further ado, let’s jump into the Q4 Income and Expense Report.
Thoughts on Quarter 4 of 2018
Wow! Last quarter we made really good money from our Vespa Tour, and I didn’t think we’d get anywhere close to our Q3 profit numbers any time soon. But somehow our Q4 profits got dangerously close to the profits we posted in Q3. Chalk this one up as another report that I write in disbelief.
This quarter we made more money from YouTube ad revenue than I ever dreamed possible. To put it into perspective for you, we had never made more than $5,000 in one month from ad revenue. In the month of December, we made over $20,000. It was a crazy feeling watching our ad revenue skyrocket when it felt like we were doing the exact same thing we always do… uploading videos.
It really was the perfect storm in the best sense of the phrase. Ad rates drastically increased around the holidays because all of the advertisers are competing for your attention. At the same time, our channel was growing faster than ever due to a semi-viral video of us riding a train. These two things collided at the perfect time to quadruple our ad revenue.
Spoiler Alert: I’m writing this in February 2019, and I can tell you that the phrase “easy come, easy go” is very accurate when describing our future ad revenue after this quarter 🙁
The other biggest contributor to this quarter’s financial success was Black Friday. We almost let it go by without a thought, but I had some free time on Friday morning so I decided to send out an email offering a discount on both of our online courses. A couple of hours later, I opened my inbox in disbelief. We had sold more courses than we had in months in a couple of hours. It seemed like every time I refreshed my inbox, there would be another sell. By the end of the weekend when the sale ended, we had sold over $16,000 in courses in 4 days making Black Friday my new favorite holiday.
In all seriousness, thank you so much to everyone who trusted us enough to purchase one of our courses. We worked really hard putting them together, and we hope you’re getting a ton of value out of them.
Those were the two biggest factors that led to the big growth in our income. Everything pretty much increased proportionally with our channel growth. That tends to be how it goes. When our channel is growing, so do our other income streams. When our channel growth is slow, all of our other income streams go down.
It’s a bit of a scary position to be in with YouTube. They have so much control, but we’re very thankful that they’ve liked us a lot over the last 3 months.
Ok, let’s dive into the details of the Q4 report!
1. YouTube Ad Revenue – $45,649 (Change from Q3 +31,701.41)
As I said in the intro, there was a perfect storm that took our ad revenue to levels we never expected. As you can see from the spike in the chart, we had a video go semi-viral in early November. That video led to a lot of overall channel growth which allowed us to maintain ad revenue above $500 per day for most of November. Part of this was due to our channel growth, and part was due to advertisers increasing their ad rates around the holidays. It was a fun ride, but as you can see these rates weren’t sustainable. You can already see them dropping off as soon as the Christmas season ended.
2. Patreon & PayPal – $11,570.66 (Change from Q3 +$5,997.14)
Our Patreon revenue is directly tied to the number of videos we upload. When you set up a page on Patreon, you can choose to charge your patrons monthly or per video. We choose “per video” for this very reason. We didn’t want our patrons to pay us anything if we weren’t creating new content. For example, we didn’t upload a video in July, so we didn’t make any money from Patreon that month.
It’s scary to build a business on top of a platform that you don’t own. So much of our success/failure is tied to the growth of our YouTube channel, and we have very little control over that growth. This is why we’re so grateful for our patrons! Thanks to their support, we know that no matter what YouTube decides, this is one consistent source of income that we can count on every month!
For those of you who aren’t familiar with Patreon, it’s an online platform that allows you to support the work of your favorite creators giving them a chance to continue working on their creations without having to worry about where their next meal is going to come from!
3. Course Sales – $22,911 (Change from Q3 +$11,453)
Without looking at the dates at the bottom, can you guess when we launched our Black Friday sale? (Haha).
I didn’t expect it to go so well, but looking back I think I know why we were able to sell so many. Our channel was going through a big growth period, and I think we had a lot of new subscribers who had never heard of our courses before. We don’t talk about these very often, so I think people learning that they exist + a generous Black Friday discount ended up being the perfect combination.
If you don’t know what I’m talking about… We’ve each created an online course to teach others the subjects where we have the most expertise. For me, that’s travel hacking, and for Kara, it’s video editing.
- 30 Days to Becoming a Travel hacker is a course I created to teach others the strategies I use to save thousands of dollars on flights and hotels.
- Kara’s Behind the Scenes Guide to Creating a Vlog is the course Kara created to let you watch over her shoulder and learn the exact methods she uses to create one of our travel vlogs.
4. Affiliate Income – $14,751.59 (Change from Q3 +$78.41)
- Amazon – $1,159.61
- Epidemic Sound – $3,000
- Creditcards.com – $10,110.85
- Audible – $210
- ConvertKit – $44.10
- Adobe – $227.03
The majority of our affiliate income comes from the ongoing promotion of companies we love such as Amazon, banks with awesome travel credit cards, and Epidemic Sound. It’s an awesome feeling to get rewarded for doing something we are already doing for free, recommending products we use and love.
The really exciting part about our affiliate income this quarter is that it should all be reoccurring. We didn’t do any special promotion this quarter. We just went about business as usual using the systems we already have in place, and we earned over $14,000. This income isn’t completely passive, but it’s really close.
I’m personally really excited about how well the credit card affiliate program is going. I have been teaching people how to use credit cards to travel for less for years now, and it’s awesome to be making good money from something I was already doing for free!
If you’d like help figuring out which travel credit card(s) to sign up for to maximize your rewards and savings, you can request a FREE consultation by clicking the button below!
Or you can check out our Top 10 Travel Credit Cards post that we update every month!
Our second largest source of affiliate income is Epidemic Sound. We get all the music for our YouTube videos through this service. It’s hard to find good music for YouTube videos. Kara used to waste hours of her life searching for music, and now she has a huge library of royalty-free songs to choose from! She loves this service, promotes it at the end of all of our videos, and we get paid anytime someone signs up for a free trial.
If you need music for YouTube videos, click here to check out Epidemic Sound!
Last but not least, Amazon also brought in a decent amount of affiliate income. The majority of our Amazon affiliate income is generated by people who visit the following pages where we recommend gear we use and love.
5. Sponsored Content – $9,000 (Change from Q3 +$500)
As our channel grows, we’re getting more and more opportunities to include sponsors in our videos. It seems like every day someone sends me an email asking us to review their product on our channel. We turn down the majority of these offers, but if the product/company meets our 3 criteria, then we entertain the idea of adding them as a sponsor.
- Can we get genuinely excited about the product/company?
- Is this something we think our viewers would be interested in knowing more about?
- Does the company value our platform, and are they willing to pay us enough money?
This quarter we published 37 vlogs, and only 4 of those videos were sponsored. We included one advertisement for Trade at the beginning of a video and one advertisement for Quip at the beginning of a video. The other 2 videos that were sponsored by PADI. The great thing about the PADI videos is that we would have filmed those anyway, and partnering with them allowed us to make even better content (at least that’s our opinion).
Total Q3 Income – $103,882.25 (Change from Q3 -64,450.56)
The pie chart above gives you a quick breakdown of how each revenue stream is contributing to our total income.
Transportation Expenses – $2,822.39
Normally, we save money on our transportation expenses using miles and points that we’ve saved up by applying for the best travel credit cards. However, this quarter we ended up paying for a lot of flights out of pocket for a couple different reasons.
First, I got a little lazy with the planning and ended up having to book a couple of last-minute flights around the holidays. At this point, award flights weren’t available, and flights were expensive, so it was a double whammy.
Second, we are normally flexible with our travel plans. We can choose to fly when award flights are available or when the flights are really cheap. However, there were a few times this month where we had to be certain places on exact days. So if award flights weren’t available, we just had to suck it up and pay for the flights that were available that day.
With that said, we did spend 5 weeks in Chiang Mai, so we didn’t move as much as usual. This helped keep our transportation costs around what we normally spend in quarter.
Accommodation Expenses – $2,977.38
For the past 2 quarters, our accommodation expenses haven’t been over $500 which is crazy! This has mainly been due to Airbnb credits that we had accumulated through people signing up for the service through our link. Unfortunately, about halfway through the year, we stopped receiving credits from Airbnb and they eventually dried, which is one of the reasons our accommodation expenses are higher than normal. We reached out to Airbnb about our links not working, but they said everything looked fine. I just have a hard time believing that we went from getting multiple referrals per week to 0 referrals ever. I digress.
If you’ve never signed up for Airbnb, and you want to help me test my theory, you can sign-up at the link below.
Another thing that increased the expense of our accommodations was the 5 weeks we took off to work in Chaing Mai and another 3 weeks in Mexico. Normally, if we’re going to take this much time off we go home, but we couldn’t this year for tax reasons.
|Canmore||Cabin||7||$0||Thank you Mark and Brian|
|Singapore||Hotel||1||$0||IHG Free Night Certificate|
|Chiang Mai||Airbnb||5||$0||Airbnb Credit|
|Chiang Mai||Apartment Rental||30||$913.95|
|Dominican Republic||Resort||2||$273.20||Project with PADI|
|Tulum||Airbnb||17||$841.28||Partial Airbnb Credit|
|Nashville||Home||5||$0||Stayed with Family|
Destination Expenses – $3,572.89
This category is the money we spent while on the ground at each destination. This includes things like food, local transportation, and entertainment.
|Canada||October 1 - 18||$777.10|
|Chiang Mai||Oct. 20 - Nov. 25||$1293.71|
|Dominican Republic||Nov. 26 - Dec. 4||$107.99|
|Tulum||December 4 - 22||$545.85|
|Nashville||December 22 - 27||$570.82|
|Cancun||December 27 - 31||$208.91|
Business Expenses – $8,806.56
Each month we pay for several online subscriptions and other things to keep the vlog, blog, online courses, and email list running smoothly. I look at most of these expenses as “investments” instead of expenses because most of them are tools that enable us to make money. With that said, I may have gotten a little over zealous this quarter. Having 8 work weeks gave me plenty of time to brain storm new ideas and new strategies, and I bought online courses and softwares with the hope of implementing a few new things in the future.
Travel Hacking Wingman -$2,002.68
Benji used to be our partnerships manager, but his role has morphed into being my travel hacking wingman. Benji helps manage our travel hacking Facebook group for the students of my 30 Days to Becoming a Travel Hacker Course. He also helps me write travel hacking blog posts and give credit card consultations. I want to help as many people as possible travel cheaper using my travel hacking strategies, but I didn’t have enough time. So, I’m super thankful I’ve found a fellow travel hacker I trust to help me with the mission.
Video Editor – $397.83
After only publishing 20 videos in Q3, we knew something had to change. So we hired my sister to help rough cut videos. The goal was to save Kara some time in the editing process so that she could publish more videos. Unfortunately, it wasn’t working out as planned so we gave up pretty quickly. Even though my sister was doing a good job rough cutting the videos, by the time Kara watched the clips and got familiar with video, she didn’t end up saving much time.
Convert Kit – $2,849.50
The great email platform that we use to send emails to our list of 50,000+ people. Every year around black Friday, they offer a big discount for paying for the next year in full. Since we know the email list won’t be going anywhere, I went ahead and paid for it up front to save hundreds of dollars.
Premiere Pro – $98.28
The program Kara uses to edit our videos.
Google Service – $55.14
This is the money we pay Google for our email address every month so that we can look semi-professional.
Touchnote Postcard – $749.75
This is the service we’re using to send postcards to our patrons!
Epidemic Sound – $45
This is where we get all of our royalty free music for our YouTube videos!
TubeBuddy – $57
This service allows us to bulk edit the cards and end cards across all of our videos on YouTube. Basically, we pay $19 to avoid spending hours of our lives monotonously changing cards on our channel.
Godaddy – $386.47
This is the service we use to pay for our website, hosting, and SSL certificates. Plus, all of the other domains I buy when I think of a good business idea 😉
Gleam.io – $49
This is the service we used to host our 400k Giveaway.
Fiverr – $42
I wrote a travel hacking ebook in November, and I used Fiverr to get 6 different cover options designed.
Facebook Ads – $48.87
I think there’s a huge opportunity to increase our business with Facebook ads so I was just running a few tests.
Click Funnels – $194
I’m trying to get more sophisticated with our landing pages and sales funnels, but so far I’m just wasting money with this complicated service.
Webinar Jam – $497
I had a grand idea to start hosting more webinars this year. So far I’ve hosted 0. I’m hoping since I paid so much for a webinar software it will motivate me to follow through we the idea sooner rather than later.
Making Sense of Affiliate Marketing Course – $169
I bought this course thinking I’d learn a lot about affiliate marketing, but as I should know by now, there’s no magic formula. You have to spend a lot of time putting in the work. I’m not saying the information in this course wasn’t good, it just wasn’t life-changing.
Giveaway Prizes – $294
This is the money we spent buying the prizes for the 400k Giveaway winner.
Shipping – $94.53
We couldn’t take the drone to Cuba so we had to ship it to St. Maarten.
StoryBlocks – $39
We were really excited to start including more stock video in our vlogs that helped tell a better story, but so far we’ve been disappointed with the selection.
Fixed Costs – $880.67
T-Mobile Phone Plan – $220.07
Health Insurance – $372
Google Fi – $288.60
It would be irresponsible to travel without health insurance, so we pay what feels like too much money for an international health insurance plan every month. We used the T-Mobile Unlimited International plan for the first 2 years of our travels. However, at the beginning of this year, I decided to switch to the Google Pixel 2XL and try out Google’s phone service called Google Fi. It’s a lot faster than T-Mobile’s international service, but having separate carriers is increasing our overall phone bill. So I either need to convince Kara to come to the Android dark side or jump back on the T-Mobile train with Kara. We’re currently at a stand still.
Miscellaneous – $472.29
This category is made up of expenses that didn’t fit into any of the categories above. Some little things like Spotify and Netflix and a few bigger things like credit card annual fees and birthday presents for friends and family.
Total Q4 Expenses – $19,527.18
|YouTube Ad Revenue||$45,649|
That’s a wrap for our Quarter 4 income and expense report. These reports are getting more and more unbelievable. If you find it hard to believe that we’re making this much money while traveling the world, you’re not alone. We’re having a hard time believing it too! Thank you for all of your support. We couldn’t do it without you. I’d love to hear what you think about this report in the comments below!