This is Tip #25 of the Save $1,000 in 30 Days Challenge.
Today’s tip is to earn more money by freelancing on the side. It sounds harder than it actually is — I’ll show you how below.
As I wrote during the presidential debates, you really have two levers to control when it comes to your money: Making more (revenue) and spending less (costs). Most Americans only think about cutting costs, resulting in frugality websites that frantically try to out-do each other with the most inane and meaningless tips of all. Don’t eat out at all! Scrape foil off the sidewalk and use it to pack your lunch! Ok, I’m sure I’ll do that.
We forget about the lever of earning more money, which is the most powerful of all. You can do this in a bunch of ways:
- Negotiate your salary at work (I’ll write about this in an upcoming post)
- Start a second job (yes, about 4 billion people in the world do this…instead of reading blogs)
- Freelance for something you’re very good at
And on and on.
The money is there, but it’s really hard to get the initiative to try to earn more money, knowing that you’ll probably fail the first 10 times. I can’t help you with the initiative, but if you’ve decided to earn more, I can show you how. Today, we’ll talk about the freelance route, Q&A-style:
Q: What’s freelancing?
A: It’s just doing part-time work for something you have particular expertise in.
Q: But I don’t have any expertise!
A: I bet you do. Can you do math? Then you can freelance by tutoring kids in algebra. Do you know how to hike? Then, with a class or two, you can become an instructor for the local recreational hiking class. If you play tennis or you’re a web developer…you get the idea. Think about what you’re good at, then ask yourself how you can use it to help people.
Q: But I really don’t have any expertise.
A: Really? Do you speak English? You can tutor a foreign student easily. When I was in college, I consulted for a couple of venture-capital firms teaching them about YouTube and social networks — stuff that I used every day. (I’ll never forget being in a professional conference room and showing a bunch of partners how guys check out girls on Myspace…it may have been my life’s crowning achievement.) The key is, think about what you know and who would want to know it.
In January 2007, I posted a job ad for various positions. I ended up hiring a guy named Jeff as my book researcher — which means he has the ability to dig up anything, any time, and quickly. Could you do that? Besides Jeff’s amazing research abilities, he was being able to connect his skills (‘I’m really good at finding information’) with an opportunity he saw. More importantly, he took the initiative to (1) reach out to a site he read regularly, (2) turn in a great application, (3) show that he could do the work over a trial period. He’s now a regularly paid consultant on multiple projects with me — all because he took the initiative to reach out.
Q: Ok, I know what I want to freelance for. What now?
A: Go to places where people would want your skills. If you’re tutoring kids, go to Craigslist and search for “math tutor.” It literally took me 15 seconds to find this “Tutor needed” post — which pays $15/hour.
Email all of your friends and let them know you’re looking for a position. Tell them specifically what you’re (1) looking for, (2) what skills you have, and (3) put it in an email that they can just forward. A friend of mine named Ian did this yesterday, and I forwarded his resume to a few friends, a couple of whom are really interested. People want to help you.
Q: What should I avoid?
A: I avoid Elance because everybody tries to undercut everyone else (but I LOVE it when I’m hiring). By contrast, you should definitely look at Craigslist since (1) there’s an incredible amount of buyers and (2) everyone else is so horrible that if you can write a half-decent sentence and restrain yourself from including a picture of your penis, you can almost certainly get a freelance gig.
Don’t be utterly concerned with making top-dollar on day 1. Check out this great post by Ben Casnocha, who describes the professional speaking circuit. I can tell you that I spoke for free for many years before charging even a little…and it took even longer to charge significant rates. When you see a consultant who charges $150/hour, it took a long time to build up that skill set. Be comfortable starting modestly.
Q: What kind of money can I make freelancing?
A: This is important: You should first plan your goals with freelancing. Do you want to make enough to cover your weekend going-out costs? If so, then you only really need to make about, say, $100 per week. That’s about 5 hours @ $20/hour, or 7 hours @ $15/hour. Once you have your goals, you’ll have a better idea of how to package yourself to buyers. In general, first-time freelancers can charge $10 to $25/hour, but it really depends on your skills, location, and market demand. For example, I pay some of my contractors over $150/hour, but others work for free to develop their skills and build a relationship for future work down the road. Although the eventual point is to make money, don’t lock yourself into charging high rates upfront. See On greed and speed for more on that.
Example: If you tutor for $20/hour, 4 hours/week, that’s about $320/month. Not bad. If you tutor for $20/hour, 10 hours/week, that’s $800/month. Now we’re talking. That’s money you can save, invest, and spend on the things you love.
A final point about lazy people who complain and do nothing to earn more money
Nothing makes me angrier than people who complain about their financial situations but do nothing to solve it. If you truly believe that you can’t freelance for anything, that’s The Shrug Effect in action. Look, almost anyone can earn more money, but most of us sit on our asses and complain about taxes instead of trying to earn more. Yes, it’s hard. Yes, there’s no clear path. But the rewards are enormous, and I’m not just talking financially.
You can’t think of anything you’re good at? Ask yourself what you’re doing right now: You’re reading my blog. Do I have any needs? Of course, I do — I want to grow my site, add cool new content, etc. So how might you be able to help? Think about it tactically: “Hmm…I read Ramit’s site…maybe I should email him and send him a bullet-pointed list of things I’m good at that might help him. Who knows if it’ll work? But I’ll do this for my favorite 20 blogs and stay in touch with them over time.”
Do you read magazines? Send an email to anyone who was featured in there and let them know you love what they’re doing, and you’d love to help out in [3 SPECIFIC WAYS]. Nobody does this, so you’ll stand out. At the very least, you’ll quickly find out what skills people are looking for. Do the same for interesting people you meet online. Tell your friends what you’re looking for. And don’t be afraid to start off small (or free).
Email template that you can use:
My name is Ramit Sethi and I’m a recent Stanford grad. I’ve been reading your blog for two years (I loved the post about using virtual assistants and got BOTH of my brothers to start using one), and it’s really helped me be more efficient with my work.
It occurred to me that you’re probably interested in growing your blog. I might be able to help. I’ve done video editing (http://www.FAKESAMPLESITETHATYOUDID.com) and Powerpoint design (http://www.BLAHANOTHERFAKESITE.com). Imagine doing a great video on using virtual assistants, then distributing it through your newsletter. I could do one for you in about 2 days if you’re interested.
How about chatting later this week? My # is XXX-XXX-XXXX or I can give you a call at your convenience.
Total savings: $100 to $1,000 per month
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