The following contribution is by Pauline Paquin from the blog Reach Financial Independence. Pauline has just launched a new site called Make Money Your Way to help readers diversify their sources of income with real estate, investing, entrepreneurship and online endeavors. Born and raised in Paris, Pauline writes about how she has been traveling the world for the past 10 years, while trying to build wealth and achieve financial independence, and how you can follow your dreams and reach your goals too. You can follow Pauline on Twitter @MoneyYourWay.
If you are a regular reader of My Money Design, you know by now that the best way to build wealth is to make your money work for you, and not the other way around. How does one do that? By buying assets with one’s hard earned money that will earn income streams. For example, a rental property, that will generate a monthly rent, and appreciate in value over time. Real estate is one of the best ways to build wealth and make money, but if you are an investing beginner, you probably don’t have 20% saved for a down payment on a property. So your best bet is probably to invest a little bit of money every month, into index funds or stocks that you pick individually. This strategy is called dollar cost averaging and allows you to stop caring so much about timing the market is low, as your regular buys will help you achieve an average market cost over the year. You can start with as little as $20 a month, and should then try to invest a little more each month, until investing more the next month really becomes a stretch.
If your budget is already tight, then you’re going to need some quick money making ideas to help you get some extra cash each month to reach your goal. To do so, here are eight ideas to help you find $100 that you can start investing.
8 Quick Money Making Ideas for You to Try:
Work an Extra Hour a Day:
If you are getting paid hourly, try to stay an hour late every day. At $10 per hour, you can have over $200 by the end of the month. I like this solution more than looking for another job because you are already at work, so not only do you save on commuting costs, you save time. Finishing work at 6pm instead of 5pm, you will be out by 6pm, if you go work elsewhere it may take you half an hour or more to start working at your other job.
Work on Saturdays:
Many stores and restaurants are happy to hire extras to work one day a week. Yes, your weekend will be shorter, but that is a small sacrifice to jump start your wealth building. Try to pick a job that is not too demanding, physically or intellectually, or a job you enjoy. Be a golf instructor, a coach for little league, the valet at a high end restaurant, ask your neighbors if they need a baby-sitter… There are opportunities everywhere, most pay a basic salary but it adds up quickly.
Empty Your Storage Unit:
Having worked in IT for self-storage companies, I can attest that this is one juicy business. Storage companies try to charge your credit card automatically so you forget about them and keep your stuff there for years, lamenting with every statement that you are up for another month and still haven’t canceled. How much of that stuff do you really, really want to keep? Get over there, open the unit, and throw anything you will never use again, wear again, read again, or haven’t used in 5 years. Keep only the items of sentimental value, and try to find them a place in your home. Best case scenario, you are done with storage. If not, you should be able to downsize to a cheaper unit.
Sell the Storage Stuff:
Once you are done emptying your unit, review the things you are about to throw away, they may be of use for someone else. Cheap furniture? Sell them to college students at the beginning of the year. Maternity clothes? List them online or pass them down to a mother to be. Your junk can be someone else’s treasure, and you may even get money for it. If you do well selling, you may want to try those storage auctions where you buy the content of a delinquent unit for a few dollars and try your luck at turning a profit out of it.
Be the Neighborhood’s Go-To Guy (or Girl):
Most people need a little help here and there. To paint a room, move house, walk the dog or mow the lawn, pet sit while they are on holiday and watch the kids on date night. Be the person they call when they need something. Charge a reasonable price, and do the job the best you can. Your network will grow quickly.
Market your Skills:
To start building a clientele, tell the world you are available. This could be for anything from plumbing jobs to fixing computers to designing cool digital backgrounds to the designer checks people use for personal use. Put ads on the local board and as many free ads online as you can. It can be a skill you mastered at work, or something you are good at and enjoy doing, a regular tutoring gig or some one time job done for several clients. With a little experience, you can raise your rates, and if you are good, your clientele will grow organically.
Reduce Your Expenses:
A simple way to find $100 to invest is to reduce your expenses. When was the last time you looked at your bills? Call your providers to see if they can offer you a cheaper deal, watch closely your energy consumption to limit waste, reduce your cable package if you are not watching so much TV… And if you throw food, do not buy the same thing again the next time you hit the supermarket. Reducing food waste could cut your grocery bill by 30% if you throw food like the average household.
Get Rid of One Spending Habit:
That one is pretty hard, because you are sacrificing something in order to have more tomorrow. Delayed gratification is something we struggle to seek because our brains are programmed to look for pleasure and avoid pain. Reducing your wasteful expenses will not impact your lifestyle, since you are not using the services you pay for each month. Getting rid of your morning coffee on the go, brown bagging your lunches or going a month without alcohol is a big change. Try to tackle one spending habit at a time, the one that you care the less about giving up. To stay motivated, run the numbers on how much you will save. A $12 lunch out instead of a $2 brown bag is $50 per week, and $2,600 per year. How about investing $2,000 and keeping $600 for fun money at the end of the year? It will make giving up the habit much easier.
Those examples both urge you to make more money and spend less where your lifestyle will not be affected so much. Try to keep your budget comfortable, because if you need to access the money shortly and the market is down, you will lose money, whereas leaving it for the long term is when the magic of compound interest happens. Even if you can only find $80 a month to invest, leave that at 6% for the next 40 years and you will have $160,115 for only $38,400 invested. So get your quick money making ideas into action and start building those returns!
Readers – What do you do for extra money? Do you invest it?
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