Written by Jeremy Biberdorf
Your career is your biggest asset when it comes to growing your wealth. By landing a good paying job and working hard to earn promotions, you will increase your income over time. And as you bring in a steady income, you can invest this money in the stock market to grow your wealth.
The catch to this plan of course is keeping your expenses in line so that you have money to invest in the first place.
Unfortunately when it comes to making money, most people stop at their career. They think this is the only option they have to bring in money and as a result, settle. I am here to tell you to not make this mistake.
There are additional ways for you to earn more money so that you can save and invest more every single month. And when you do this, you grow your wealth faster than you thought possible.
By earning additional money, you can free yourself from debt, create a cushion between paychecks and even start putting a meaningful amount towards retirement each and every month.
In this post, I will walk you through the process of figuring out your best option for making additional money so you too can benefit and change your financial life for the better.
Then I will show you how this new found income can jumpstart your investments.
How To Start Earning Side Income Fast
#1. Determine Your Goal
The first thing you have to do when considering making money on the side is to take a step back and figure out how much money you need each month.
You can figure this out by taking the total amount you need and dividing it by the time until you need it. For example, if you need $5,000 in 2 years for a big family vacation, you would take the total amount and divide by 24 months. In this case, you would need roughly $210 a month.
If the reason for you wanting extra income doesn’t have a set time frame or the math to determine the monthly amount needed is too difficult, like for retirement, you can just set a number and try to hit it.
But one word of caution, you need to be reasonable with the amount you select. While it would be great to earn an extra $5,000 every month, for most people this is not realistic.
But if you decide to strive for making an extra $250 a month, which is more realistic, you can make $3,000 over the course of a year.
So sit down and take some time to figure out the amount of money you want to make each month. Then move on to the next step.
#2. Understand Your Passions
Once you have a goal amount set now it is time to start coming up with ideas for how to make this money.
There are countless ways to make extra money, like freelance writing, taking a second job, or even babysitting. But before you jump for the obvious ones, I want you to again take some time and figure things out.
Find a quiet place and think about the things you enjoy doing. It doesn’t matter what they are right now, just record everything that comes to your mind.
Once you have your list, it is time to organize it. Take out a piece of paper and draw a line down the middle. Now look back over your ideas and separate them into categories. On the left are the ideas that have the potential to make money and on the right side are ideas that don’t have the potential to make money.
For example, if you enjoy washing your car, this has the potential to earn you income. If you enjoy watching sports, this doesn’t have the potential to earn income long term.
When doing this exercise, try to think outside the box as much as possible. For example, you might think that sleeping isn’t a way to make money. But you could take part in sleep studies to earn money.
Once you have your list separated, you can start to figure out what money making options will work to provide steady long term income.
#3. Will It Fly?
Here is where you figure out if you can start making money from your passion. While you can make money from sleeping as I pointed out, will this money meet your goal? Chances are sleep studies will be few and far between, so earning a steady income is most likely not possible.
For washing cars, you can get started with this fairly quickly. You will have to spend some money on supplies, but you can find clients on Facebook and in your neighborhood and be making money in no time.
Try to be honest with yourself here so that you don’t chase ideas that really don’t have the opportunity to make steady income. I know sleep studies sound awesome, but as I said, chances are you aren’t going to be making reliable income here.
#4. Getting The Ball Rolling
Now that you have your idea and you know it will work, it is time to start making money! In the beginning, try to spread the word as much as you can without paying for advertising. With this said, don’t go overboard and annoy your friends and family.
And as you begin to earn money, be smart about it. If your money making idea requires supplies or you want to start paying to advertise, be sure to use money you are making from the side gig.
When I started out, I was taking 25% of my income and reinvesting it back into the business. This helped me to not only buy supplies, but also to have a cushion in the event something came up that I wasn’t expecting.
Also, try not to over commit to your side gig. It is easy at the beginning when you are excited to want to spend every waking moment on it. But you have to keep living and enjoying life too.
Finally, make sure you use the money from your side gig for your goal you created at the beginning. If you are saving this money for a large purchase, put the money into a savings account so you won’t be tempted to spend it.
How Your Side Income Adds Up
For most people reading this, your goal for side income is to pad your investment accounts. Remember how earlier I talked about keeping your monthly income goal reasonable?
This is where this point comes into play. If you can simply make an extra $200 a month and invest that in the market, you are going to quickly grow your wealth.
For example, if you invest this money for 10 years and earn 8% annually, you will end up with an extra $37,000! As great as that sounds, remember if you pick a side gig wisely, you will love doing it and it won’t feel like work at all.
There is the process to start making money on the side to grow your investments. Too many people jump in head first and fail miserably. This is usually due to not understanding what they enjoy doing or wanting to make an unrealistic amount of money.
By going through this process, you ensure you pick the right side gig and you pick one that has the most long term success.
And who knows, you may love making money on the side so much that you stick with it even after you reach your goal. Doing so may even allow you to retire early one day.