I've told this story before, but it's been a while. After I decided to turn my financial life around, I started managing my personal finances as if I were managing a business. Okay, lots of you know that.
But what most of you probably don't know is that I took a ton of inspiration from a videogame. Back in 2004 and 2005, I played far too much World of Warcraft. I wasn't particularly good at it -- except one tiny little aspect. I couldn't kill the ghosts and the ghouls very well, but I was damn good at taking the loot I found -- the weapons, the armor, the treasures -- and re-selling it at the (in-game) auction house for big bucks.
Although I didn't know it at the time, I was practicing arbitrage: Getting stuff for cheap, then reselling it at (or above) market value. I made bank doing this. As a result, I was able to buy better (in-game) gear, which let me beat up more monsters, which let me make more (in-game) money. Sounds stupid, I know, but it was truly an important part of my real-life financial journey.
In my spare time recently (which isn't much), I've been reading Side Hustle, the new book from my friend Chris Guillebeau. Because CG is a friend, I'm not sure I can provide an objective review of the book, so I'm not going to try. Instead, I'll give a brief summary and then share some of my own experiences earning money on the side.
Side Hustle Nation
Fundamentally, there are only two ways to improve your financial situation: You can earn more or you can spend less. Most money writers focus on the "spend less" side of the equation. That's great, but there's only so much you can cut. Eventually, if you really want to pursue your goals with passion, you're going to have to earn more. "More income means more options," Guillebeau writes. "More options mean more freedom."
For many folks, a side hustle is a smart way to earn more. A side hustle, Guillebeau says, is "a moneymaking project you start on the side, usually while still working a day job. In other words, it's a way to create additional income without taking on the risks of going full throttle into the world of working for yourself."
The beauty of side hustles is that they can be started with little or no money. They're most often passion projects, ways for a person to take something they already love and maybe earn a bit of extra cash.
Guillebeau says there are five core steps to starting a side hustle:
- Build an arsenal of ideas. The first step is to brainstorm a list of ways that you could earn money in your spare time. How could you match your skills and resources to a product or service that people would pay for? List as many as you can think of, then weigh the pros and cons of each.
- Select your best idea. You can't do everything, of course, so you're going to have to narrow your list to the single best idea -- the one that excites you the most. "You're not making a lifelong decision," Guillebeau writes. "You're looking for the right idea at the right time." After you've picked a project, do some research. Learn how other people have done the same thing. Figure out who your ideal customer is. Decide what it is you're going to sell.
- Prepare for liftoff. After you've chosen your product or service, it's time to prepare for launch. Figure out the core logistics issues. Set a price. Create your workflow. Don't worry about getting everything perfect, but do take the time to master the basics of your business.
- Launch before you're ready. This is a lesson I've had to learn the hard way. There is always more to be done before you start a big project. (Heck, I wasn't ready to re-launch Get Rich Slowly last Sunday, but I did so anyhow.) When you have your logistics, workflow, and pricing roughly right, then go. Start your hustle.
- Regroup and refine. Naturally, not everything will be perfect -- especially since you launched before you were ready. As you sell, as you interact with customers, learn from your experience. Enhance what is working, and discard what isn't. If there are things you can't handle, ask for help. If a process can be automated, automate it. Adjust pricing, if necessary.
But the most important ingredient to starting a successful side hustle is action. If you don't take action, nothing else matters.
I've been earning a living since the Bronze Age (circa 1973), without ever holding a day job. Over the decades I've had my share of money struggles, but I found my way around them and am now, at 65, in the best financial shape of my life.
Here are seven lessons that helped me arrive where I am today.
Side jobs are always a popular topic on Get Rich Slowly.
Whether your goal is to boost savings, supplement retirement income or pay down debt faster, you are not alone in choosing to work nights, weekends or in-between other demands.
Sometimes you need extra income in order to meet unexpected expenses or to save for a major purchase or goal. With the rise of the sharing economy it is easier than ever to latch onto short-term gigs, especially if you have a strong Internet connection and some idle time.
If this sounds like something you've done or are considering -- you have plenty of company. A new study by the Brookings Institution showed a "surge" -- as they described it -- in such jobs after analyzing Census Bureau information on non-employer businesses of one, in other words, self-employed, unincorporated sole proprietors.
Plenty of Americans have that entrepreneurial spirit. Being your own boss and setting your own hours is liberating, and millions of Americans have made the leap. But there are special credit challenges to be aware of, especially in the first two years of striking out on your own.
Self-employed Americans by the numbers
According to a 2014 report from the Bureau of Labor Statistics, 14.4 million Americans are self-employed. (When you factor in part-time independent workers, that number is even higher.)
Ah, summer employment. Those heady teenage years when you worked from June through August, doing what no adult in their right mind would do, for a wage no adult would agree to, all the while hoping to meet the boy of your dreams. Heaven, right?
Well, not exactly. Even with the rosy glow of nostalgia attached, I still remember many of my summer jobs as just plain hard work.
I had the itch. I had a great idea and the support of my wife. I had the hunger to write my own story. It was 2002 when someone from a division at my Fortune 50 employer whispered in my ear: "If you go out on your own, we'll hire you." So I made the leap and started my own business in 2002. And it was great -- until late 2007 when the sky started to fall. One by one, they took communication in-house, including that Fortune 50 client which made up 60 percent of my client portfolio.
Being an entrepreneur has many, many rewards: It feeds your passion, you don't have to answer to "The Man," and you can insert a few coins into your piggy bank. In that sense, having your own business is also a drug: The highs and lows directly correlate to how the business is going. It's always on your mind and you are always thinking about the next big win, the next big growth move. That's how it was for me anyway.
I'm still connected to the business through marriage. My wife took it over. She even throws me an assignment here and there. She's a great boss too!!
At the age of 50, I was laid off.
It was a Thursday morning in August of 2013 and it came on a conference call along with hundreds of co-workers. I had been working in one way or another since the age of 13 — babysitting, apple picking, camp counselor, journalist. It was the first time I had ever been involuntarily out of work.
Did I mention it happened while I was technically on vacation? Yep. I had to dial in to a conference call to lose my job while at the beach on Cape Cod. Oh, Corporate America. Continue reading...
Ted Leonhardt's plunge into entrepreneurship was just that -- a plunge. After working for a small graphic design agency for eight years, he lost his job and was facing an uncertain future.
"I was in survival mode," he recalls. With a mortgage and a baby, he had to do something quickly.
He caught a break when one of his former employer's clients encouraged one of their own clients to hire Ted -- if he started his own business.