People often ask me about different ways to increase their income, whether it’s to have a bit extra for vacation or to meet their financial goals. A side hustle is a great way to generate income outside your full-time job.
Here are the 8 side hustle ideas you can start right now, along with a risk and reward analysis for each.
Analyzing risk and reward:
Value for Time
Download your own copy of the side hustle grading matrix: http://bit.ly/2VSMG1g
8 Best Side Hustles
1. Uber or the On-Demand Economy
Driving for Uber has moderate financial risk, and I only recommend doing it in the short-term. Requirements are high because you have to either own or rent a car.
Income reliability is high because you know how much you can earn based on how much you drive. On the other hand, the financial upside is low because you can only drive a finite amount per day.
In terms of skill growth, I would label it as low since you’re not gaining any new tangible skills.
2. Airbnb / Turo
Renting out your home (Airbnb) or your car (Turo) is another side hustle that’s accessible if you have the respective items to rent out.
Income reliability is high if you can keep renting at high occupancy. On the same note, the financial upside is limited since you can only rent out the item a finite number of times per month.
Although the financial upside is limited, this doesn’t mean that you can’t make a lucrative amount of money from Airbnb or Turo. It mainly depends on market rates and timing (conferences or holidays). I have some friends that make $200-$500/night renting out their property on Airbnb.
Skill growth is low because once you get the hang of the process, you can most likely find ways to automate it. For example, you can hire and schedule cleaners after you rent out the Airbnb.
3. Mechanical Turk
Mechanical Turk is a marketplace by Amazon where you can get paid for each task you complete. Task prices are relatively low, so you’ll need to complete a high number of tasks each day to earn a reliable income.
There’s a low financial risk to start since you can pick and choose the tasks to complete. The financial upside is low since you can only complete a finite number of tasks per day.
Skill growth is also low since most people put menial tasks on Mechanical Turk.
4. Reselling Items
Reselling is listing items you own on eBay, Facebook Marketplace, or any reselling website. The financial risk and requirements for entry are high because you need to own/buy the items first before reselling them.
Income reliability is moderate since unless you know the market well, there’s no guarantee that you’ll make a good profit from reselling.
For expert resellers, the financial upside is high since you can multiply your money. Skill growth is moderate if you develop new sales and marketing skills.
5. Fulfillment by Amazon (FBA)
FBA is when you buy inventory in bulk and send it to Amazon to fulfill the orders. For example, if you buy imitation plants from Alibaba for $1/unit, and you sell it on Amazon for $10/unit, Amazon will take their cut and fulfill the orders.
You’re in charge of creating the store, buying the inventory, and sending it off to Amazon. The financial risk for FBA is high because you need to buy the inventory upfront, and you need to know your target market.
A quick disclaimer before you jump into FBA: be sure to control your risk. There are a lot of “scam” courses out there that try and teach you FBA. They’ll also try to sell you useless inventory that won’t sell. The risk of financial ruin is high.
6. Upwork or Freelance
Make money by freelancing with a skill you already have. The risk of freelance work is income reliability since you’ll need to find a steady flow of work each month.
The financial upside is moderate since you can only accept a finite number of projects. However, you can start charging more for each project or increase your hourly rate once you become an expert.
7. Learning A New Skill
Learning a new skill is the most effective way to 10x your income. It’s the idea that you’ll need to take two steps back to jump ten steps forward.
New skill ideas:
Learning how to code
Develop a specialized skill that people will pay for. The financial risk is relatively low because, with the internet, you can find a wealth of free knowledge.
Income reliability is low since you’ll be new at the skill, but once you develop the skill, people will pay for it.
Learning a new skill has a high financial upside and high skill growth since it will likely help you start a new career path that increases your income.
The financial risk of YouTube is relatively low, as long as you’re not making inappropriate content that puts your day job at risk.
The idea is to monetize things you already enjoy doing on a day-to-day basis. For example, if you are a data scientist and you want to help other people, you can create videos about how to get a job in data science.
Another example is if you love to travel, you can make city travel guides on what to eat and places to visit.
As long as you have a phone with a good quality camera, you can start a YouTube channel. Income reliability is extremely low since it might take a while to find your audience and meet the YouTube monetization requirements.
The financial upside if you succeed is high, and skill growth is high since you’ll need to keep innovating to create more content.
Value for Time
Is the side hustle worth your time? Depending on the side hustle you choose, it might not be worth your time.
Uber - Low value for time. Unless it’s your last resort, I recommend trying one of the other side hustles on the list. Uber can be a good way to earn enough stable income to be “ramen profitable,” but I suggest looking elsewhere for a long-term solution.
Airbnb/Turo - High value for time. Once you automate the process of renting your items, you can get the work hours to maintain the listings down to 1-2 hours a week.
Mechanical Turk - Low value for time. You’ll need to complete a high volume of tasks to make a reliable income.
Reselling Items - Moderate value for time. It depends on the items you’re reselling and the profit margins.
FBA - High value for time. Once you find a niche that works, you can build a system to scale out the business.
Upwork or Freelance - Moderate value for time. You’re getting paid to develop your skills by working on new projects.
Learning A New Skill - High value for time. Learning a new skill like coding can change your career and multiply your income by 2-5x.
YouTube - High value for time. If you enjoy making videos and find the right niche, your channel and income will grow. What do you already do right now? How can you monetize them?
Editorial Note: Opinions expressed here are the author's alone, not those of any bank, credit card issuer, airlines or hotel chain, vendors or companies, and have not been reviewed, approved, or otherwise endorsed by any of these entities.
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