When someone comes to me and asks how to get out of debt my general advice includes:
- Organize and come up with a strategic plan
- Refinance to a lower interest rate if possible (Check out LendEDU* to compare student loan interest rates)
- Automate your money
- Track Everything (Related Post: Spending Recap 2016)
- Eliminating excess expenses
- Live below your means
- Earn extra income
This is solid general advice, and I think most people need to start here to gain control of their situation. However, understanding that saving money to pay off debt is not the full equation to becoming Debt Free.
If you earn extra income, in addition to your regular salary, you can put yourself in a better position. With producing more income, you can pay off debt much faster than if you only rely on your primary source of revenue. Back when I started paying off my debt, I relied on my salary from work. I developed some great money habits in this process, but in the last year, I recognized that I could have paid off my student loan debt much faster if I developed a side hustle and created additional streams of income.
Did you know the average millionaire has seven sources of revenue? How many revenue streams do you have?
Today is the easiest time in history to make extra money. There are many new ways to You can get a part-time job (in addition to your primary income source), freelance, or create passive income for yourself. Now, many platforms allow you to make extra money from your computer. Anyone can earn extra income if you put some effort into it.
The Sharing Economy
One of the best ways to make extra money is utilizing the “sharing economy.” The “sharing economy” consists of a peer to peer marketplace and or apps. Today, there are over 200 sharing economy platforms. You might recognize popular marketplaces such as Airbnb, Uber, Lyft, Fiver, and Upwork. These types of markets eliminate the middle man and open the door for anyone to create their own side business.
Buyers and sellers from these kinds of marketplaces are held accountable by a rating system (generally a 1-5 star range). Each transaction produces a rating for both the buyer and seller. The rating system gives the sellers an incentive to provide an excellent service to their “customers” so they can keep their rating high. If they get a bad rating, it can turn away business in the future. The rating system also incentivizes buyers to show the best image of themselves to receive access to all deals/options. Since both parties have a compelling reason to be nice to each other, it leads to a more friendly transaction.
I prefer the sharing economy platforms vs. regular employment because it lets you monetize on things you already have or things you already do. You probably have one of the following assets: own a house, own a car, have a particular skill, or have extra time. With sharing economy platforms, you can turn your underutilized assets into an income producing side business.
One of the biggest selling points for the sharing economy is flexibility. You can earn extra money on your terms and your schedule. With flexibility, you have the option to make a living off of it or simply make a few extra bucks a month. You control how much time and energy you put into it, and that’s the beauty of it.
Recommend read: Buy Buttons – This book shows real life examples of people using sharing economy platforms to make extra money or create their businesses. This book opened my eyes to how many marketplaces there are that I have never heard of and how I can utilize them to accomplish my side income goals.
Side Hustle Ideas with the Sharing Economy
Here is a list of some potential side hustles you can pick up. I am looking to add a couple of new side-hustles this year from this list.
- Rent a Room out on Airbnb* (sign up and earn $40 free, I would earn $20)
- Drive with Lyft or Uber* ($20 off your first ride with Uber)
- Find Freelance gigs online on Upwork, or Fiverr
- Sell you Skills in person – Thumbtack
- Sell-Arts/Crafts on Etsy
- Sell your stuff or Flip items on Ebay, Craigslist, 5Miles, or Offer Up
- Deliver Food with Postmates, Uber-Eats, or Insta-cart
- Micro Tasks with Amazon Mechanical Turk
- Complete tasks Task Rabbit
- Online Survey’s
- Give advice on clarity.fm
- Take care of pets on Rover or Dog Vacay
- Rent out your car on Toro
- Let someone park on your property – justpark.com
- Delivery with Amazon Prime Now
- Sell you Photographs with Istockphoto.com
- Tutor or coach people on savvy.is
My Side Income Pursuits
So far this year I have been selling stuff I don’t use in addition to flipping items on Ebay. I was motivated by a video by Gary Vaynerchuk earlier this year and have made a goal to make over $750 with side income from selling on Ebay by April 1st. I have also used platforms like Craigslist, Facebook Marketplace, Offer Up, and 5miles to flip items. Doing this takes some time to research the market trends, but there are plenty of great deals and ways to make money flipping items online.
Check out the 2017 Flip Challenge video if you are interested.
As of now, my website isn’t making a consistent income. However, it is more of a long-term project for me. Currently, since starting my site, I have received a lot of value from sharing ideas and meeting new people with similar interests and goals. I am also developing new skills such as becoming a better writer, learning to build a platform, and becoming a better communicator. Developing these skills will help grow the site and open more doors in the future.
Job Spotter App (Created by Indeed)
I learned about this app from one of my favorite personal finance bloggers – The Financial Panther, check out his blog post here. With this app, all I have to do is take pictures of businesses with “Now Hiring” signs. You get paid up to $1 per image depending on the business, and you get paid out through Amazon gift cards. If I go out for food or if I’m at a shopping center I spend an extra 10-15 walking around taking pictures of “Now Hiring” signs.
Teach English on Palfish App
I signed up as a teacher to teach English to Chinese students. I don’t have any formal teaching experience. The app is pretty simple: I signed up as a teacher, set a 30 sec recording to introduce myself, and set my hourly rate. After a few minutes, I got a call from a student. Most of the time they can speak decent English, and you just have to have a reasonable conversation.
I get paid through Paypal. Check out my recommendations page for more details.
The great part of having a side hustle is that the sky is the limit. Since you don’t depend on this money to survive (primary income) you can spend as much or as little time on it as you want. I feel most people have a lot of room to optimize their spending and prioritizing debt, but once you master that side of the equation there is only so much else you can do to optimize. Most of all, earning extra income is what is going to put you ahead of the game to accomplishing your goals and crushing your debt.
Question for You:
What ways do you make money outside of your Primary source of income?