Managing Money

Stacks of LindensAs a club owner, I run through a lot of Linden Dollars. There’s payroll for our employees to be met every night, as well as the prize for the contest board(s) and money to dump into the sploders, to keep the customers interested and sticking around. In addition, I pay nearly L$3500 in tier every week to maintain the Evans Family Compound property, and I have other incidentals that require L$ expenditure, too. So, I do quite a bit of buying via LindeX…and, in the process, I’ve learned a bit about how to most effectively use it. New Residents who want to augment their balances will probably benefit from this post.

First tip: Don’t buy straight through the viewer, and always use Limit Buy. The in-viewer L$ purchase system does a Market Buy, which is not the best way to get the most L$ for your dollar. By default, you can’t do Limit Buys through the Web site either, unless you change your default LindeX view. To do this, visit the “My Account” page on secondlife.com, click on the “Linden Dollar Exchange Settings” link in the right-hand column, select the “Advanced” radio button under “Interface Mode,” and press “Submit.”

Now, unlike Market Buy, Limit Buy does not automagically pull money from your credit card or PayPal account when you buy currency; you have to add credit to your SL account first. This is done from the “My Account” page, by clicking the “Increase Your Credit” link in the right-hand column. Just click the link, key in the amount of money you want to add in the “Money To Add” field, push “Next,” and confirm the transaction on the next screen. You do have to add a minimum of US$25, but this credit that you add can also be used to pay for your monthly premium fees and mainland tier, if applicable. If you’re smart about it, for instance, you can add US$25 to your account just before your premium fees come due, buy US$15 worth of Lindens, and let the account fee for that month absorb the remaining US$10 in credit, eliminating a billing step.

Now, when you click the “Buy L$” link in the left-hand column, the page here may look more confusing than you’re used to. You’re going to concentrate, though, on the following elements:

  • The two “Buy at a Specific Rate” entry fields, “Quantity of L$” and “Exchange Rate.”
  • Your current L$ and US$ balances, over on the top right.
  • The numbers at the very top of the listings of “Open Buy Orders At The Best 20 Rates” and “Open Sell Orders At The Best 20 Rates.”

So, how do you fill in those two fields? In general, I fill in the “Exchange Rate” field first, then the “Quantity of L$” field. This may seem counterintuitive, but it will help you get the most amount of L$ for your money.

First off: How do you select an exchange rate? To a certain extent, it depends how quickly you need the Lindens in your account. If you bid the rate of the top “Open Sell” order (or less), for instance, you’ll get the L$ almost as quickly as if you did a Market Buy. If, on the other hand, you bid the rate of the top “Open Buy” order (or more), your transaction may wait around for a long time before it’s filled. Effective use of this requires some advance planning; as an example, if I’m in-world in another window, I will bid closer to the “Open Buy” price, because I’ll need the money pretty soon, I’m guessing; if, on the other hand, I’m executing the transaction from work, when I know I won’t even be in-world for the next few hours, I can bid higher.

Then, after you’ve selected a rate, fill in the “Quantity” field. As you do, the “Approximate Cost” will display as a text line between the two fields and the “Offer to Buy” button. (This cost includes a US$0.30 fee LL tacks on to all LindeX “buy” transactions.) Compare this number with your current US$ balance and adjust it as needed. I like to adjust it to come a few cents under my US$ balance, because sometimes the actual amount you get charged will differ by a penny or two, and that could cause your transaction to fail or you to wind up with a negative US$ balance. Keep adjusting the quantity until you’ve come to the right amount.

Ready? Press the “Offer to Buy” button, re-submit your log-in information, and then confirm the transaction. Then just wait. The “Transaction History” link in the left column will show you the status of your “open” order; if need be, you can cancel an order before it’s completely filled. Eventually, assuming you get all the L$ you asked for, the transaction will be closed out and moved to the “Closed Orders” section of the page. (In the case of my most recent order, which was bid at L$270 when the top “Open Sell” price was L$267, my order was filled and closed within 2 minutes. That tells me I could probably have bid a little higher, closer to the top “Open Sell” rate of L$276, without too much trouble.)

For day-to-day cashflow management, I use Ginko Bank to store excess L$. I try to start off an evening with between L$3,000 and L$4,000 in my “wallet”; if I have less, I withdraw a thousand or two, and if I have more (as I would if I recently made a buy on LindeX), I deposit the excess. They do pay interest, but I’m not concerned about that most of the time; I’m just looking for a good place to store reserves I don’t immediately need. Other in-world financial services companes, such as Apez, would also work here.

Occasionally, I’ve conducted private transactions for L$ as well. An example of this was when a friend of mine needed US$100 in RL, and happened to have around L$27,000 available. I agreed to the deal, as it would get me L$ I would have had to buy anyway, at a decent rate, and without incurring the LindeX fees for either of us. I initiated the PayPal transaction to send her the US$100, following which she paid me the L$27,000. (If she had tried to cheat me, that way, I could have canceled the PayPal transaction before it completed. Not that she would have, but this is why we performed the operations in the order we did.) If you do this, be careful, and make sure you know who you’re dealing with. In my case, I’d known this person for months, and even conversed with her on Skype, so I knew she was on the level, and (just as importantly) she knew I was on the level.

Hopefully this has helped improve your knowledge of currency trading in SL, and you can use this to help enhance your Second Life. Happy spending!

“Money, so they say, is the root of all evil today” – Pink Floyd, “Money” (album: Dark Side of the Moon)

(Thanks to Tateru for suggesting the topic of this post.)

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4 Comments

Filed under Business, Tips and Tricks

4 responses to “Managing Money

  1. Thank you for this very informative breakdown of an SL option that I have looked at but not yet taken advantage of. Can you elaborate more on the part “you can add US$25 to your account just before your premium fees come due, buy US$15 worth of Lindens, and let the account fee for that month absorb the remaining US$10 in credit, eliminating a billing step.” I understand the uploading of $25 but why split into two separate areas to cover one bill? How is that elminating a billing step? Am I not seeing the forest for the trees? {:o) I’ll check back later for the next lesson!

  2. Here’s what I was thinking, Tinsel. You add US$25 to your balance, so you have a balance of US$25. You use US$15 of that on LindeX to buy Lindens, using the technique I describe. That leaves you with US$10 as a balance. Then LL bills your account fee for the month, charging it against the balance you already have, making your new US$ balance US$0. (All numbers approximate. You may have a few extra cents left in your balance.) Therefore you do not incur a second charge against your credit card or PayPal account, beyond the one that increased your credit in the first place, as LL has their account fee and they’re happy. Alles klar?

  3. I got ya now. I wasn’t thinking about the residents who pay monthly premium fees (I paid the yearly). *presses FLY to rise ABOVE forest and trees* Yes, you are correct that this would be a cost saving measure. As for the rest of the lesson, I shall put it to use with my next L$ purchase! Might I suggest an Evans Tip of the Day with each post? {:o)

  4. Thanks so much for that! But too much info to absorb at 3am … so will have to revisit! I’m hopeless in RL at accounts … perhaps I can excell in SL! lol

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