How to Make More Money: the Total Beginner’s Guide to Generating Cash 
Whenever you go to Google to find out how to make more money, you’re subject to the same old suggestions that don’t work. If you’re here, you want different, and that’s exactly what I’m going to give you by NOT giving you a 100+ list of things that stopped making money back when we dial-up was the new kid on the block. In other words, here are some of the best ways you can start making money in 2019.
The 3 best ways for beginners to make extra money
There are plenty of ways to make more money — but my three favorite ways are:
- Tap into Hidden Income
- Negotiate a raise
- Start a side hustle
1. Tap into Hidden Income
This isn’t income that your grandma hid under her mattresses or in the chimney for safe keeping. I’m talking about money that you can save right now if you just made a few negotiations with your billing companies.
In fact, you can save hundreds per month with just a few one-time, 5-minute phone calls, including:
- Car insurance
- Cell phone plan
- Gym membership
- Credit card
There are only three things you need to do to negotiate with these companies on fees and rates:
- Call them up.
- Tell them, “I’m a great customer, and I’d hate to have to leave because of a simple money issue.”
- Ask, “What can you do for me to lower my rates?”
Of course, you’re going to want to adjust this formula for whatever company you’re calling. Check out my video on negotiating your bills for more on this topic.
2. Negotiate a raise
Salary negotiations are magic.
Seriously. That’s because with a single conversation, you can make thousands more than you did before.
The best part? Your gains only add up year after year.
Check out how much you can earn over the course of 40 years with a single salary increase:
Luckily, I have a system that’ll help make it a little less terrifying while increasing your chances of nailing them and getting the salary you deserve.
Three months before negotiations
Before you even think about getting into your boss’s office and hashing out what type of company car you want them to give you, you need to start tracking everything you do at work and the results you get.
If you were on a team that sold 50,000 widgets, figure out what you did to help make that happen and quantify it.
By tracking all of your accomplishments and giving a hard number to them, you can adequately make your case as to 1) Why you’re an indispensable employee and 2) Why you deserve to earn more.
During this time, ask your boss if you can schedule a time to sit down and discuss ways you can excel at work. Make it clear you want to exceed expectations and ask what that would entail.
Two months before negotiations
Now it’s time to meet with your boss again and show him your tracking from the previous month … and ask him what you can do better.
You want to make sure you’re on the right track with your work. More importantly, you’re communicating your results. This shows your boss you’re willing to take the initiative to make your work and therefore the company better.
During this time, you’re also going to want to prep The Briefcase Technique. This is a tried-and-true system my students have used to earn thousands in immediate salary gains.
Here’s how it works: You’re going to create a one- to five-page proposal document showcasing specific areas in the company wherein you can add more value.
Then you’re going to bring that proposal with you when you negotiate your salary. When compensation discussions come up, you’re going to pull out this document and outline how you’re going to solve the company’s issues.
Check out the two-minute video below for more.
One month before negotiations
If you haven’t already, now’s the time to mention to your boss that you’d like to discuss compensation at a meeting next month.
Ask what you’ll need to bring to make it a fruitful discussion and listen carefully to what your boss has to say.
During this time, it’s time to do some research and practice.
If you don’t have a hard number when you walk into salary negotiations with your boss or hiring manager, you’re going to be at the mercy of someone who does this for a living and will control the conversation.
To that end, there are a few great resources for you to find a good number to start with:
- Salary.com: This is a great website for both employers and job seekers to compare compensation rates for specific jobs across a huge variety of companies.
- Glassdoor.com: Though this site primarily acts as a “Yelp for jobs,” it also includes an incredibly handy salary tool that allows you to look at the national average salary for your job as well as the average rate of compensation in your city.
- PayScale.com: This website sends you a personalized salary report based on a questionnaire you fill out regarding your career history. It’s especially great for recent college grads.
- Ask a friend: Do you know anyone who has worked in this field before? Maybe a friend of yours has been in the industry for a few years. Ask them how much they were paid — as well as advice on how much you should ask for as well.
Now it’s time to practice, practice, practice, and practice some more.
After all, it’s one thing to research and read about negotiations. It’s another thing entirely to do it live and under pressure.
To practice effectively, you’ll want to first brainstorm as many different discussion scenarios that might occur with your boss as you can. Then run through each of those scenarios with a friend and play them out.
- Your boss acts surprised or annoyed when you bring up a higher salary.
- Your boss asks you to name a number first.
- He gives you a BS excuse like “It’s the economy” or “Everyone else is getting the same thing.”
Then observe or have your friend give you feedback on the following:
- Your words. They should be compelling and concise.
- Your body language. You want to be sitting up, attentive, but relaxed.
- Your tone. It should be professional, positive, and energetic.
Practice up until the day of negotiations. Once there, you’ll be as ready as you’ll ever be to negotiate your salary.
In my 6-minute video below, I go more in-depth on how exactly you can absolutely crush your salary negotiations. Check it out.
3. Start a side hustle
Salary negotiations are great, but my all-time favorite way of making extra money is by starting a side hustle.
What’s a side hustle, you ask?
Simply put, side hustles are freelance businesses that can generate you cash outside of your normal work hours, like…
- Graphic design
- Copywriting and editing
- Web development and programming
The best part is freelance businesses are easily scalable, so you can make a lot of money if you’re willing to devote just a little bit of time to it. Or if you get busy in other areas of your life, you can scale back.
The 4 steps to make extra money on the side
Step 1: Find a profitable business idea
As mentioned above, finding a profitable business idea is as simple as looking at your strengths. You can do that by answering four simple questions today and finding a side hustle that’s perfect to you.
- What do you already pay for?We already pay people to do a lot of different things. Can you turn one of those things into your own online business?Examples: Clean your home, walk your pet, cook you meals, etc.
- What skills do you have?Now, what do you know — and know well? These are the skills you have that you’re great at — and people want to pay you to teach them.Examples: Fluency in a foreign language, programming knowledge, cooking skills, etc.
- What do your friends say you’re great at?I love this question. Not only can it be a nice little ego boost — but it can also be incredibly revealing.Examples: Workout routines, relationship advice, great fashion sense, etc.
- What do you do on a Saturday morning?What do you do on a Saturday morning before everyone else is awake? This can reveal what you’re passionate about and what you like to spend your time on. Examples: Browsing fashion websites, working on your car, reading fitness subreddits, etc.
Find an answer to those questions and I promise you you’ll find a profitable business idea.
Step 2: Find good leads by standing out
It’s funny. People think that Craigslist is all creepy encounters, shady sales, and weird “gig” opportunities. But it’s actually a fantastic place to find new clients for your freelance work.
In fact, when it comes to finding clients, it’s one of my favorite places to turn to.
You just have to remember one thing: The vast majority of people applying for work on Craigslist are terrible candidates. That means if you just put in a little bit of effort into making sure your application is good, you’ll immediately stand out from the pack.
That’s exactly what you can start doing to generate effective leads.
Check out the jobs section of Craigslist and take a look at the ads relevant to your business.
If you took the time to write a great email reaching out to these companies, you’ll immediately separate yourself from 99.9999% of others on the site who are just sending boring boilerplate emails that’ll get them nowhere.
This doesn’t apply to just Craigslist either — you can use this with any job site. The key is to just be slightly better than average and willing to test a few different emails.
Here are a few suggestions of great sites freelancers can use to find business:
- Writers: MediaBistro.com, Upwork.com, FreelanceWritingGigs.com
- Illustrators/Designers: 99designs.com, Designs.net
- Programmers: Toptal.com, Gun.io
Step 3: Use the 5-line email pitch to qualify your leads
After you find a few good leads on potential clients, you’ll need to craft a pitch that is tailored to their needs and concerns.
In doing so, you’ll want to stress the BENEFITS of working with you — while not giving away too much information as to how you’ll help. I lost my fair share of clients while I was starting out by giving away exactly how I’d help them in my initial reach out. Stupid.
Because I’m a nerd, I’ve developed a 5-line email template you can use to send the perfect email pitch. It includes:
- The introduction. You’re going to want to build rapport by introducing yourself and how you know about the client.
- The offer. Talk about them. What do you want to do for them? Why are you good for that role? You’re going to want to do some research on the organization to see what they need help with.
- The benefit. Walk them through how your work will benefit their company. Are you going to free up more time for them? Are you going to maximize profits by X amount?
- The foot-in-the-door. This is a classic technique that utilizes an old psychology trick to get the client to agree to a small agreement so you can ask for a larger agreement later.
- The call to action. Be clear with this and ask them if they would like to proceed. The call to action is a critical part of this script.
When it’s all put together, it’ll look something like this:
[Introduction] I read your article about X and noticed that you’ve recently started using videos on your website.
[The offer] I’ve been doing video editing for three years and I’d like to offer to help you edit your videos and get them optimized for the web.
[The benefit] That would make them look more professional and load faster, which is important for your readers. And you’d free up time that you could use to create new content.
[The foot-in-the-door] We can discuss the details, of course, but first I wanted to see if this is something you might be interested in.
[The call to action] If so, would it be okay if I sent you a few ideas on how to help?
Step 4: The Tuner Strategy to charge the perfect price
People always get tripped up about pricing, which is why I always hear questions like:
- How much should I be charging?
- Is X amount too little/too much?
- Should I be charging by the hour or per project?
These are questions every freelancer asks when they start out. And while there are no set rules for rates, there are actually a few methods you can use to find one that works for you.
- Drop Three Zeros MethodSimply take your ideal (read: realistic) salary, divide it by two, and then drop three zeros from it. Boom. You have an hourly rate.For example, say you’d really like to earn at least $80,000. Just take out the three zeros from the end, divide by two, and you now have your rate: $40/hour.
- Double your “resentment number”I love this one because it’s both really interesting and effective. Ask yourself: What’s the lowest rate you’ll work for that’ll leave you resentful of your work?Say you’ll work for $15/hour at the VERY LEAST. Just double that number, so now you’ll earn $30/hour.
- Do what the next guy doesThis method is incredibly simple: Go to Google and search for the average hourly rate for whatever service you’re providing. You’ll get a good sense of where to start when you’re charging your clients.
The best part is after you start charging your clients, you can start to take on more or less work until you earn the amount you want.
For example, after you earn your first $1,000, it’s incredibly easy to start dialing your prices up and charge even more money from your clients.
Start “tuning” your rates after your first few clients. Were you making $30/hour? Start charging $40 or even $50. There’s no hard and set rule for how much you should charge. Just start tuning until you find a rate you’re happy with.
Step 5: Use the 85% Rule to invest in yourself
When it comes to starting a new business, too many of us will get overwhelmed thinking that we need to do everything “perfectly.” In fact, many will spin their tires doing things like:
- Starting a blog
- Creating a Facebook page
- Buying ads on Google
- Hiring skywriters to promote their business in the skies
This is an easy way to get burned out, leading us to do nothing at all.
Your goal isn’t to start a blog or create a Facebook page with millions of likes — your goal is to FIND PAYING CLIENTS.
That’s why the easiest way to start freelancing is to take things one step at a time and not worry about getting it perfect.
I’d rather get it 85% right than do nothing at all.
Remember: it’s okay to make mistakes. The important thing is that you get started and learn from those mistakes.
The best way to get started is to begin investing in yourself.
Now, one thing that you will find very common with people who have not taken the time to invest in themselves and learn how this stuff works, is they will create what’s called levels of abstraction.
Rather than just going directly to what they want, they will create all these different levels of abstraction — like making a Facebook page or a blog — that make them feel good, but that actually don’t require them to do the hard work.
So, they’ll spend six, nine, 12 months doing something frustrating and then give up because they never spent time buying a couple good books or buying a course.
That’s why I’d like to offer you somewhere to start: my newsletter.
Join this private list to see the tips, strategies, and techniques you WON’T see on my blog.
Mental barriers we face trying to make extra money:
Ramit, I’m not ready to make extra money because of [issue]
“But Ramit, I don’t think I can possibly work on a side business. I don’t have enough time and I don’t think I even have a business idea!”
There are always going to be excuses when it comes to trying something new — but when you take a look at some of them, you’ll realize that they’re almost always all MENTAL barriers.
Here’s how you can break past the 3 most common ones I’ve seen.
Mental Barrier #1: I don’t have the time to make extra money!
It’s always funny to me when people tell me they don’t have enough time for their regular job, let alone a freelance business on the side.
Well, I actually have a secret I’d like to tell you that might blow your mind…
…YOU DO HAVE THE TIME!!!
There’s no doubt about it: starting a freelance business will take time — but not nearly as much as you think.
Can you spare an hour a day to freelancing? How about a few hours on the weekends?
I’m guessing that you can. Maybe instead of spending after-work time endlessly binging Netflix or browsing Reddit, you can devote yourself to starting a business that can earn you extra thousands this year. Hell, work from a laptop on the couch while streaming; Netflix and Making Money is the new Netflix and Chill.
Saying “I don’t have the time” is really saying “This is not a priority.” Try that out. “Making more money is not a priority.” Compared to “Browsing Facebook is not a priority.” Which one of those is true?
Mental Barrier #2: But I’m so tired after work!
This is actually a very valid concern. After all, many of us work long eight-hour days — how are we expected to come home and work on freelancing when all we want to do is pour ourselves some wine and put on the latest episode of The Bachelor (or is that just me..)?
It’s difficult — but you can actually do it successfully with some simple psychology.
Imagine a smoker. Many smokers know that smoking is a bad habit and is terrible for their health — but they still do it because of cognitive dissonance.
What they’ll say is, “Yeah, I know it’s really bad for me but I work really hard and I deserve this pack of cigarettes.”
It’s the same thing as starting an online business. At the end of a long work day, you’ll say to yourself, “I worked all day and dealt with my dumb boss and blah blah blah. I really deserve to kick back and watch Netflix.”
Instead of falling victim to cognitive dissonance, remember this question:
When you look at some successful freelancers who earn hundreds of dollars an hour, many will think, “I’ll never be able to earn that!”
But you WILL as long as you start today. And a year from now, you’ll be earning much more than you would if you didn’t do anything at all.
Mental Barrier #3: I don’t have a good business idea!
This is the most common barrier preventing people from making money freelancing: not knowing what type of work they want to do.
As I’ve outlined in the steps above, though, it’s simple to identify your profitable skills as long as you look at 4 things:
- What do you already pay for?
- What skills do you have?
- What do your friends say you’re great at?
- What do you do on a Saturday morning?
And the answer to this mental barrier will serve as the very first step in creating your side business.