Here are the results after three weeks of my Secondary Income Experiment:
I have been pretty busy the last two weeks and have not been able to spend as much time on the blog. Online Gaming activities have been working well for me, so I am going to continue those outlets.
Stay tuned for more updates!
Sunday Links
Have a great week!
Here are the results after one week of my Secondary Income Experiment:
I managed to dedicate a little more time to the blog which has lead to some ad revenue. I have also signed up on Elance in an effort to build some virtual assistant revenue.
Stay tuned for more updates!
This lecture (post) is part one of a two part series covering the basics of budgeting.
Welcome to Budgeting 101: Budgeting Theory
Given that all readers have successfully passed Income Allocation 101, we are ready to explore the second funnel your money trickles into, expenses. The first lesson within this series will explore the theory behind budgeting and gain an understanding of a budgeting universe.
In order to understand the theory behind a budget, we should re-visit a key concept from Income Allocation 101: your savings funnel establishes the direction and monetary discipline of your expenses. Often times individuals believe that income allocation is a steady balance between savings deposits and expense payments, as presented below:
A more appropriate model has the individual determining his/her required savings allocation, and subtracting that savings allocation from total income to build a base budget:
The theory behind this approach: individuals have the opportunity (or are strongly encourage) to build savings before worrying about cable bills. By understanding this theory, we can quickly assemble our budgeting universe. Let’s say, for example, you were able to calculate that you need to save 9% of your annual income for retirement, 4% for emergency savings, and 2% for a family vacation. This means that 15% of your adjusted net income will be dedicated to savings categories, leaving the remaining 85% for expense management. If this individual brings in $70,000 a year, or $56,000 after taxes, he/she will have a yearly budget of $47,600 ($56k x 85%). In short, this individual’s budgeting universe is a little less than $4,000 a month.
The next lesson (post) will attempt to explain the various processes and methods for budget creation and maintenance.
Taxes appear to be slowly down my post rate. The depth of my tax filing can be attributed to one of my 2007 goals, make more stock trades. The “make more trades” goal was designed to build experience in investment decision making and asset allocation. While these trades appeared to build my investment knowledge, it has really been a burden to input all of these trades manually because my tax software will not upload my trading history.
Anyways, I will stop complaining. I should have a nice post about budgeting published by tomorrow morning.
Sunday Links
Earlier this week we introduced different sources of secondary income and my experiment to see which of these activities yielded the highest hourly wage. It appears that one vendor that aids individuals seeking secondary income has introduced an excellent service helping order fulfillment.
Fulfillment by Amazon is a new service that eliminates another barrier to selling your junk, constant trips to the post office. The picture below basically highlights the service:
Amazon allows you to mass-ship your junk to a distribution warehouse. When a customer orders your product, Amazon recognizes the sale and ships the item to the buyer. If you want to look like a professional business, Amazon can even print unique packaging labels.
It appears Amazon is attempting to further this notion of insourcing, made famous by Thomas Friedman’s The World is Flat. Insoucing is basically outsourcing business processes, allowing firms and individuals to execute business functions they wish to specialize in. Fulfillment by Amazon allows you to simply find your junk and list it, while they do the rest.
My last post highlighted some activities you can do right now to build a secondary flow of income. I figured it would be a good experiment to figure out which activities yielded the highest hourly wage, or which sources brought in the most money with the least amount of effort. I compiled the activities within my experiment into six categories:
I plan on reporting progress every week, while sharing some tips along the way. Here is my progress for activities starting yesterday:
Secondary income is revenue derived from activities other than your core occupation. Creating secondary income is essential to building net worth. The Simple Dollar recently wrote an article describing ways to exploit your passion for additional income. I have compiled ideas from the The Simple Dollar and other sites to build a list of 15 secondary income sources:
1. Blogging: The best way to understand the concept of making money from blogging is to think that your creating an online newspaper. Newspapers make money from selling advertising spots within the paper. Revenues from blogging usually come from advertising opportunities, but can come in the form of product reviews and guest writing as well.
2. Niche Consulting: You are likely an expert in a particular niche and could build income from freelance consulting within this discipline. Specific niche-based consultants have recently become more popular and there are now opportunities to cash in on all types of consulting from event-planning to home organization.
3. Tutoring: Similar to consulting, many individuals have specific talents that can be shared to others in the form of lessons. A great way to build income is through private piano lessons or instructing an aerobics class at the local gym. Tutoring is truly an excellent source of income because it usually requires little capital investment to share your services.
4. Selling Your Junk: Clean out your garage and start selling your junk on eBay. This activity is great because it not only adds some cash to your wallet, it actually helps move junk out of your house. I recommend selling on eBay, Amazon, and Craigslist. All of these sites offer user-friendly services that will get you selling in no time!
5. Become a Writer: If blogging is not your niche, but you love to write, consider writing your own book or articles for online sites and magazines. Using this as a platform for building secondary wealth is usually a bit difficult. It often requires the right connections and experiences to make substantial money. The Simple Dollar article encourages you to network with local publishers in order to best pursue this option.
6. Selling Other People’s Junk: If you have mastered #4, you may want to push the envelope and really craft a trash-to-treasure business. This entails going to rummage sales and estate auctions to find cheap items, cleaning them up a bit, and selling them for a premium online. This requires a lot of market knowledge; understanding what sells and for how much, but is done successfully all of the time.
7. Become a Virtual Assistant: The growing acceptance of professional and personal outsourcing has opened up many opportunities within this income stream. Individuals can now deligate data entry, phone solicitation, and online shopping when they are too busy. As a virtual assistant, your ability to complete these tasks for your client will put cash into your wallet. Find out more about virtual assistants here.
8. Selling T-Shirts: Got a creative flare? Many online sites like CafePress.com and Zazzle allow you to design and sell your own appeal, but do not require you to maintain any inventory. These sites basically engage in all of the other business activities (manufacturing, storage, order procurement and shipping) reducing any significant capital investment.
9. Selling Art: Sticking with creative income sources, selling art is another way to translate a passion into income. The nice thing about selling art is the variety of channels to which you can derive revenues from your work. eBay and other sites are great outlets for sales, but local art groups and community events are great resources for selling your work.
10. Website Services: If you have technical talent, offering website solutions is a great way to build secondary income. Many software and web applications make it very easy to build websites, and with more businesses and individuals requesting websites, this opportunity could prove to be a lucrative source of income.
11. Surf the Web: Always on the internet? One way to leverage this hobby is by making money by clicking through advertisements and participating in web surfing studies. Be careful with these services because they are a lot of scams in this arena, but generally this vehicle is a great way to build secondary income.
12. Online Referrals and Affiliate Marketing: This usually requires a website, but email works as well. These activities build revenue through product referals. If an individual were to purchase a product using your link or referal code, you would receive a commission from that sale. To learn more about this money maker, click here.
13. Selling Stock Images: Love to take photographs? This income strategy may be for you. Website designers pretty much always outsource images on the websites they create. You can make money by selling your photos on a slew of online stock photography sites.
14. General Goods & Services Businesses: A classic secondary income strategy that has work for years is simply selling speciality products and services to local clients. If your neighbors love your sweet apple pies, maybe you should consider selling them. Have a dog that you walk everyday? Why not earn income from busy dog owners by offering to walk their dogs while you walk yours? Simple services like these are needed in every neighborhoods and are opportunities for wealth creation.
15. Part-time Job: No secret with this income strategy. Libraries, museums, and retail stores are always looking for weekend help. If none of the other income strategies tickle your fancy, try old reliable to build income!
Have more secondary income ideas? Please share by commenting below!
Sunday Links
Reconsider paying for cable!
