We all know that it’s important to diversify your investments, but diversification isn’t just for your retirement portfolio – I’ve always been a fan of diversifying your income as well. And I’ve been thinking about it a lot lately, since a friend of mine is desperately trying to figure out a way she can bring in extra income each month.
April will mark 10 years since I graduated from college, and I can’t believe I’ve been in the work force for a decade already. In that time, I’ve held 8 full-time jobs over a variety of different industries. EIGHT JOBS. Some of those jobs only lasted a few months, while others I was at for a couple of years. None of them really relate to each other, but what remained constant over those eight full-time jobs was the fact that I always had multiple ways I was making money on the side.
Related: Are you a job hopper?
Benefits of diversifying your income
Not only do you increase your disposable income, but it can make you feel more secure against a job loss or emergency situation. Working above and beyond the 9-to-5 has always part of my routine because it provides me with additional cash to throw at my financial goals (whether it was getting out of debt, saving for a down payment, funding my future retirement, or going on an awesome vacation).
Related: How I saved for my down payment
Here are 5 ways I’ve been able to diversify my income over the years:
1. Offer a service
Think about what kind of service you can provide to people. This can be anything from walking dogs, tutoring, babysitting, painting, consulting, mowing lawns, or maybe shoveling snow. :)
Love to cook? Did you know people will pay you to make them a home cooked meal? Try Mealsharing.com or EatWith.com to earn extra money doing what you love – and share your love of food with interesting guests.
When I first started getting serious about my debt, I started to do a bit of freelance graphic and web design. I didn’t make a lot of money in the beginning, but within a couple of years I was able to charge between $40-60/hour.
This may seem like a weird service to offer, but I’m going to throw it out there because it’s unique: an ex-boyfriend would carry the backpacks of people who wanted to camp overnight in the wilderness, but didn’t have the capacity to carry their own gear. He loved this because he basically got paid to go hiking, and he was able to share remote areas of BC with people who otherwise wouldn’t have been able to experience it on their own.
2. Sell a product
Now I’ve never actually sold a product before, but I’ve often thought about putting my graphic design skills to work and selling cards or prints on websites like Etsy. I’ve also had co-workers who sell their knitting, cross-stitching, and other crafts online. It doesn’t make them a lot of money, but it’s a way for them to turn their hobby into a little bit of cash.
3. Get a part-time job
I’ve had part-time jobs for years. None of them paid particularly well, but they offered me a steady income when I desperately needed as much money coming in as possible. The great thing about part-time jobs is they’re often flexible and can work around your current schedule. While in college, I worked two part-time jobs, and while I was getting out of debt, I worked two part-time jobs and a full-time job. It’s not often glamorous work, but it could help you get out of a tough financial situation.
4. Rent out your property
If you’re a homeowner, consider renting out your spare bedroom or your basement suite to bring in extra income. I’m also a fan of AirBnB as an option as long as you’re careful about who you rent to. An ex-boyfriend used to rent out his downtown Vancouver apartment every time we left town on vacation. It brought in over $100 per day and he was very happy for the extra income.
There are also people who rent out space in their vegetable garden, an area in their garage, and even their parking spaces. When I was a homeowner, I had an extra parking stall that I wasn’t using, and would rent it out for $50/month. It wasn’t a lot, but $50 extra each month is better than nothing – especially for a space I never used.
This might be the hardest way to make money for someone who isn’t already a blogger – because you actually have to start a website from scratch. :) Having a website can be quite lucrative – I know some bloggers who make over $10,000/month just through advertisements. That’s quit-your-day-job type of money, but for the rest of us, you can make anywhere from a couple hundred to a few thousand dollars a month once you figure out what your niche is, and once you get the right connections.
Related: How I became a freelancer
Diversifying your income stream can be hard work at first. But it’s my experience that the benefits outweigh the extra hours you have to put in each week. And now? It is completely worth it and just seems normal to work an extra 8-10 hours a week above and beyond my normal full-time job.
What are some ways you’ve diversified your income?
A few months ago, I wrote an article for Moneyville about how you can earn extra money as a travel guide – and the more I think about it, the more I think it’s a fabulous idea. Think it’s a bit weird? Hear me out first…
Peer-to-peer travel websites are becoming extremely popular. You all know that I love accommodation websites like VRBO and AirBnB (not to mention options for couch surfing, or house/pet sitting gigs), and I’ve definitely considered peer ride share programs in Europe as well.
Now, a new trend is emerging, and websites are beginning to offer peer-to-peer travel guides. These websites connect local freelance guides or advisers with travellers who are looking for a unique or tailored travel experience. I’m not talking about those big walking groups, or cheesy double decker bus tour guides either. You can be a guide to just one person, a small group of people, or a large party if you really feel like it.
The best thing about being a tour guide (besides being your own boss and having a flexible schedule that works around your life), is that you get to decide what you want the tour to be about. For example, if you know all the local hot spots for microbrewery beer, or you love vintage cloth shopping, or you go on gorgeous runs every weekend – there are people that will pay you to tag along for an off-the-beaten-path travel experience.
A few days ago, I was browsing a few of the most popular peer-to-peer travel guide websites, and noticed that some guide have popped up in the neighbourhood where I live. I thought it was a bit strange, since I live in the suburbs (about 30 minutes from downtown Vancouver), but their tours looked interesting and seem to be popular, so it gives me confidence that I could potentially do this too when I get home. I know enough local hikes, good places to eat, and cool beaches to visit that I could do something like this once in a while.
Here are three of the top peer-to-peer travel guide websites, each offering a slightly different experience for both the guides and the travellers.
This is a way to earn extra money for sharing your favourite activities and things to do in the city. For example, one guide in Toronto is offering two-hour tours of Kensington Market for $19 per person. If she books a family of four, that’s $76 earned in just two hours of work!
Other unique ideas from other guides around the world include tours of local university and college campuses (perfect for prospective students who want a more personal tour than the free ones the university offers), ghost tours, pub crawls, and running routes.
Most guides charge between $15-25 per hour, with HipHost taking a 20% fee from the final invoice. HipHost also encourages travellers to tip, so you might earn a little more money at the end of your tour.
Vayable offers some extremely unique tours. For example, in New York City, you can participate in a midnight street food crawl, or take on a five-hour urban spelunking adventure. If you have a unique activity to offer, this might be the best website to showcase your services.
Guides are able to charge on a per person basis, or as a flat rate – and whatever you charge, Vayable will take a 15% service charge from each transaction.
This is a unique website because it doesn’t actually require you to take tourists on guided tours yourself. Instead, your job is to provide unique travel itineraries and travel advice to people who want tailored recommendations and don’t want to bother with Lonely Planet guidebooks.
Once you’ve created a free travel adviser profile, you can represent as many travel destinations as you want. So for example, if you live in Toronto, but spent five years living in Prague, you might feel comfortable providing travel advice for both locations. I know I would feel comfortable creating travel itineraries for my hometown of Victoria, and probably of Stuttgart, Germany (where I currently live) as well.
You can make anywhere from $20 to $200 for creating a custom travel itinerary, although it’s important to note that SnappyGo will take 30% of the fee that you charge to your customers.
Would you consider becoming a travel guide or adviser?
If you have extra space in your home, and you’re looking for a way to make additional income without the commitment of having a roommate, listing your space on a vacation or short-term rental website might be an interesting idea to look into.
I personally love staying in vacation rentals and apartments because they’re much more interesting than a hotel, and they’re often cheaper. Plus, they’re always in way cooler neighbourhoods.
When I was visiting New York City a few years ago, my friends and I rented a 1-bedroom apartment from someone on VRBO.com. He worked and lived in the unit below the apartment. In Budapest, my boyfriend and I rented a spare bedroom from a woman who lived in the heart of downtown for just €12,50/night each. And in Switzerland, we used AirBnB.com to rent a room in a house for less than half the price of a hotel.
It’s a really interesting way to earn money. Because I mean, why let the space go to waste if you’re not even using it? I know of people that rent parking space in their driveway to people living in apartments close by, and I know a couple who rented out a small corner in their garage for someone looking for storage space. It’s something I will definitely consider when I eventually move into a home with more than one bedroom. :)
Here are a few things to consider if you’re thinking of turning your spare space into extra cash:
- The ability to pick and choose your schedule. You are in control of your space, so you can decide if and when you want to take on renters based on your personal needs, or your financial requirements. For example, if you are a freelancer, and you know the summer months are slow for business – but big for tourism – you might decide to rent your extra bedroom for only a couple months out of the year until business picks up again. Or if you are going away for a week, list your space online for the exact time you’ll be away. Not only will you earn a bit of extra cash, but someone will be there to water your plants and collect your mail (if you ask nicely).
- Make sure you’re in a desirable location. If you want to succeed at earning cash, you need to be located in an area where people want to be. This includes easy access to public transportation, proximity to a tourist attraction, or an area of historical or geographical importance.
- There are up-front costs. There’s more to renting out your space than throwing up a picture on a website. You will need to clean the room and any common space, buy bedding, and fix any quirks your home might have – like a washing machine that squeaks, or a door that doesn’t lock properly.
- You need to be a people person. If you’re renting out a room in your home, you will need to be able to get along with all different kinds of people – even in the event you get a “problem” guest, it is up to you to solve the situation.
There are also ways to make your home more appealing to renters, and to attract repeat customers. Here are a few that I have picked up along the way:
- Create a guide to your neighbourhood. It’s a great idea to leave a short information sheet for your guests. Whether it’s the address of the nearest convenience store or ATM machine, or a collection of the best restaurants in the neighbourhood, the added touch of a neighbourhood guidebook will make your guest more comfortable, and it also shows that you have pride in your home and your neighbourhood.
- Provide your guests with towels and linens. Some people who rent out their apartments ask that guests provide their own towels and linens. But with today’s airline baggage restrictions, that just isn’t reasonable anymore.
- It’s the little things that count. Since most people are used to staying in hotels, they might have forgotten to bring personal items like shampoo, conditioner, body wash, and hair dryers. Having these little things available to your guests can make all the difference – and saves them from running to the nearest drug store.
- Be accessible. It’s important that you can trust your guest, and your guest can trust you. Respond to e-mails promptly, and provide your cell phone number in case you need to get in contact for any reason. Offering to help them get acquainted with your neighbourhood will go a long way to help your guest feel comfortable, and you might even make a new friend in the process.