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What is the Best Way to Make More Money?

jeffkuo · March 19th, 2008

The following is a guest post written by FMF of Free Money Finance, a blog devoted to helping readers grow their net worth. FMF posts daily on a wide range of money issues including making money in a variety of different ways. Some of his successful money making ideas include maximizing your greatest asset, getting the most from cash back credit cards and turning a hobby into an extra income. These and other ideas have helped FMF dramatically grow his income through the years.

I’ve faced a money making question a few times in my life and I’d like to get your thoughts on it. Here’s the question:

As we all try to grow our incomes, which is better, doing more of what we’re currently doing or trying something totally new?

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Let me give you an example.

A few years ago, I had developed my writing hobby into a fairly nice income. I was writing for top-notch magazines and getting paid anywhere from 40 cents to $1.25 per word (just to note, they give you a word-count for each assignment — you can’t simply rattle on for 30 pages to make $100,000.) I was making a few thousand dollars a year for what really wasn’t much work, maybe 3-4 hours per article. Not to mention, my family and friends (and me too) loved seeing my name in print.

However, like with anything, there were downsides. Editors were becoming more and more demanding on extras for each article, there was more competition for each article I secured, and new publications took a lot of marketing, not to mention luck, to break into. I was confident that I could get some more business from my current publications as well as break into a couple more, but this would take some time and effort. So I asked myself whether it was worth it or not. Even more, was it even worth me writing for the same publications or should I do something different with my time?

Well, I guess it depends on what my alternatives were, right?

Here are some options I had for making money in my spare time:

  • Focusing on my investments — I had them fairly under control, but I needed to spend some good hours really sorting through my strategy for dealing with some past bad decisions. I knew that getting things straightened out totally would net me a decent return.
  • Consulting — I had a few people asking me to do some side work for them and help them out in their businesses. The per hour rates were equivalent to what I make at work if you include the benefits from my current job.
  • Blogging — Back then, no one thought you could make any money blogging. But it was something I could do easily and I thought it had potential.
  • Starting a new business — Or maybe even buying an existing business. I had a few ideas for this option, but I wasn’t sure of the time commitment (which I thought would likely be high).

Each of these, like my hobby income, had their own list of pros and cons — potential income, time commitment, “hassle factor”, and so on. But before I selected one I had to decide what was my best option — to keep doing more of what I had been doing or whether I should try something new.

Millions of Americans face similar decisions every day. For instance, many people who work hourly jobs are asked to work additional hours or maybe even overtime. Each time they say “yes” or “no” to these offers represents them making a decision on which is better — doing more of the same or trying something new. And for the rest of us who aren’t hourly, we still face the issue when we look at making extra income — should we try to make more doing what we do at our jobs every day (as a side business or maybe even spend more time at work in hopes of getting promoted/earning more) or do we focus on something else during our off-time?

How does this situation apply to you? Consider the following questions that following in the same line of thinking as described above:

  • Is it better for you to stay in your current profession and progress in it or consider an alternative profession?
  • If your current profession is acceptable, is it better to work on advancing in your current company (working extra hours and harder to get raises/promotions) or is it better to consider doing the same type of job at another company?
  • Then again, maybe the best way to maximize your income is to simply do a good enough job to remain employed, then spend your extra time on outside income-producing projects.
  • And which outside project(s) should you choose? Ones you’re familiar with or ones that are new/different?
  • Ultimately, is it better for you to spend all your time on outside pursuits (such as your own business) versus any time on a job?

It’s certainly a lot to consider — and obviously money is not the only factor. But if you honestly think through all the options and their associated payouts, risks, time commitments, levels of personal fulfillment, and so on, you’ll be able to pick the option that makes you both the wealthiest and happiest.

For me, this latest decision came down to the following:

  • I was tired of writing for mainstream publications.
  • I was tired of dealing with editors demanding more work for less pay.
  • I wanted to try something new.
  • It wasn’t like I was making an extra $50,000 per year, so the risk of losing everything by trying something new was low.
  • I had the feeling I could make some big money with one of the ideas.

In the end, I cut back on all but the easiest to maintain/work with publication (which still gave me 3-5 articles a year) and focused my remaining time on getting my investments on track. Once I completed this (it took me a couple months), I started blogging. So far, it’s turned out to be a great decision as:

So, now the question is in your court. Which do you think is better: doing more of what you’re currently doing or trying something totally new?

Now I have to get back to deciding whether I should do more blogging or try something new. 😉

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17 Comments

 
  1. Great post, FMF!

    I am someone who falls under the category of “trying to do more of what I’m currently doing.” I have a great (but not that great-paying) salaried job and I’m not ready to look for another one, so like you, I began freelance writing on the side to make more money. It is something I truly enjoy. Right now, I have only published with regional magazines and it has not become lucrative yet. However, I’m at the point where I’m ready to put the time and energy into it to make it so. As someone who has been there, do you have any advice for how I (and others like me) can break into new and national publications and truly “make more money?”

  2. kevin white

    I wonder about this sort of thing now and then. I do tech support and software testing for a small company. The tech support side I have down pat, but my software testing skills seem kind of … specific. We don’t do a lot of the automated testing stuff which most other companies do.

    I enjoy my job, but I feel like looking for another job would leave me with something entry-level, or scrambling to try and teach myself things I’ve never had to do in my job, only to find out that I would not have the right experience anyway. I often feel like if I had to change jobs for some reason, I would end up changing careers; I don’t think I’m a match for the business-oriented IT world.

    My hobbies, on the other hand, are fiction writing and photography, both of which seem likely to make me money if I try to pursue them further. Since I like doing them, it seems likely that I’d consider trying to focus on them as additional income, or even try to switch careers into some writing/photography-related job.

  3. AJC @ 7million7years

    Great questions, FMF. Having done a little of all of these things I can tell you this:

    1. My investments have provided about $5 Mill of my Net Worth – but the cashflow to fund a pool that big came from my businesses

    2. Consulting / blogging is great – but, the return is simply limited to your TIME (a fixed commodity) x an equally fixed (but, growing) function of how much you can charge per hour

    3. Businesses clearly provide the best risk/reward trade-off – but, you must recognize that there IS a risk

    The best solution for most people is to do ALL of the above:

    Keep your current job and start a business on the side … perhaps blog / consult about your experiences in your job and/or business as you go … and, as a hedge, control your expenses; eliminate your debt, and plow as much of your income from all sources (business, job, blog, consulting) into your INVESTMENTS as possible. It worked for me …. it might work for you, too!

  4. This is something I’ve thought about a lot. Since I am so early in my career (I’m only 25). I’ve been focusing on learning everything that I can and growing as much as possible. I would like to eventually branch out into something else. I started writing a blog about young professionals. Maybe it will turn into something someday. For now its just fun. Who knows where I’ll end up. I guess that’s part of the fun.

  5. on Point #2 by poster above, I would say that Consulting/blogging is a little more dynamic than that. For instance, blogging is terrible returns for the first 6 months, or however long, but after that, your time invested can actually go down while income holds steady or even goes up…or at very least doesn’t decrease proportionally to your effort. With correct time investment up front you can invert the time/reward curve later on.

  6. 7million7years

    Like all things, Jesse, only for a relative few who are really prepared to treat it as a business: look at this list of top sites and/or bloggers … annual income drops off rather rapidly:

    http://paulamooney.blogspot.com/2007/06/paulas-new-list-of-blogger-salaries-and.html

    For the rest of us, we should treat it as a ‘side biz’ and save at least 50% of any of the income we might get out of it (I don’t even bother advertising on my blog).

  7. Christopher Mancini

    This is a great post. Sometimes it is nice to know that there are others out there that deal with some of the same decision making challenges that I do on a semi regular basis.

    While studying CIS(computer information systems) and working a part time gig, I made the choice to quit school and my job to become 100% self employed. I started out fixing computers. Little by little I began maintaining networks for small businesses and now developing web based applications. If I never tried to do something new, I would never have quadrupled my income last year, making almost twice what my parents made combined…

    Now I am off to try something else new, by partnering with a friend starting a web based property management solution / rental property listing service. We are really excited and scared to death. But I am confident that I made the right decision.

    Thanks again for this insightful post,
    Chris

  8. Nitin Rao

    Well money out of blogging is a great idea, but what to do when suddenly users are tired of your content or decide to move on. That’s real scary. 🙂

    http://www.my2dimes.com/
    Nitin @ My 2 dimes

  9. JohnofScribbleSheet

    Business has got to be the best way to go because it has no ceiling. However, it requires the most work!

  10. Marsello

    Great post, I am currently considering the same option myself, more like a dilemma really. My current job gives me tons of free time and a decent salary. I tried to push myself for promotion by gaining certification and showing all of my accomplishments to the higher ups but it seems that all I get from my efforts is a 3% inflation adjustment to my salary and a 10% bonus. That brings me to this dilemma since I’m really conflicted in trying something new. I wish to continue working for this company because I love my current set up and try to make some extra income on the side, which is why I started blogging but traffic has been slow. Any advice?

  11. Awesome Post!

    I’m a true believer that you can turn any hobby into a side income. All it takes is a little dedication and ACTION. If you don’t take action, you’ll never earn that side income.

    I’ve always found that if you’re already working a full time job, don’t pick up another side job with another corporation or business, instead take a risk and build your own side project. Having your own business has both it’s downfall and reward but when it comes to earning, the sky is the limit!

  12. Ramit! I miss your voice! Not that these guest posts aren’t great, but…I come here because you make PF fun!

  13. Nyaradzo

    myself i’m quite sceptical about working full time as a proffessional because i somehow feel robbed of my time and effort thus i would rather persue side businesses and hobbies that can give me income i can invest and manage.

  14. Justin

    I Just wanted to say that I don’t think its worth it doing the same thing over and over again. I worked at Budget Car Rental for 2 summers and the first summer was ok, but when I went back it had gotten worse, they were really shoving sales down our throats and I hate feeling like I’m coercing the customers to take the sales. It just doesn’t feel right to me. Needless to say, I tried to do only the minimum of hours needed (I was working full time at this time). Now, we had a shift-change in the middle of the summer, when everyone got new hours…I ended up thinking it was a week ahead and so came into work on what I thought was my new workday, but was really still my day off. I realized it and left half an hour before my shift was over. Towards the end of the week, actually my last day before my days off, the manager asked me if I would work for him tomorrow. I told him I’d have to think about it, and he asked again right before I left. I told him no, because it would’ve meant I’d been working 7 days straight and there was no way I wanted to do that. He looked like I’d kicked his puppy or turned him down for prom or something, but me feeling better about myself was worth more than the over time pay to me.

    I have gone for a new approach too, making money on a paid to click website called bux.to, where you can buy referrals and then earn money for their clicks. Its really a new idea for me, and I was nervous at first about spending the money on it that I did, but its actually paying off and I’ve since doubled the money I put into it. This is saving me from having to go back to budget for a 3rd year, and helping to keep me stay sane and not hate my job.

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