Second Income Ideas: Start Earning Extra Cash in 2023
I’ve developed a 3-step system that you can use to find great second income ideas today. Your immediate goal by the end of this system is to have one good idea that has earned you at least $100.
Once you have that, it becomes much easier to earn thousands of dollars and beyond.
- The 3-step plan to find and start your second income idea
The 3-step plan to find and start your second income idea
Step 1: Find great second income ideas
Most people make this step way too complicated, usually because they’re looking for ideas that are clever and unique. If that’s your goal, that?’ great, but it’s definitely not a prerequisite to making money.
One of my favorite personal finance books, The Millionaire Next Door observes that most rich business owners work in ‘dull-normal’ industries: carpenters, dry-cleaners, vacuum services, etc.
The same applies to freelancing. Here are a few real-life examples:
- John Z. did well on his SATs, so he started doing college prep tutoring for high school students. He got as many clients as possible, then started rapidly raising his rates until only his top clients remained. He now charges $80/hour, meaning he can work just 10 hours a week and still earn $40,000 a year.
- Bryce Conway traveled for free using credit card rewards while he was in college. When his friends and family kept asking him for travel hacking advice, he decided to turn it into a side hustle. Now he generates over $25,000 a month in revenue and passive income.
If you’re trying to earn money, you can do well by simply brainstorming ideas that already exist in some way. No need to re-invent the wheel.
Here’s what to do: Get a sheet of paper or open up a text document. Spend some time brainstorming each and every freelance service you find the slightest bit interesting. Get it all down on paper.
NOTE: The key to doing this well is to not edit yourself. Don’t worry if you think ‘nobody wants this’ or ‘I’m not qualified to do this.’ Write it down anyways.
This is an exercise in coming up with ideas, you’ll do massive edits on the list later. Try to come up with at least 50 ideas, though I bet most of you can come up with more.
“But Ramit, I can’t even think of a single freelancing service I might be interested in!”
That’s okay! Here’s what I suggest: Start by examining your own life and the things you do on a regular basis. Here are five great areas you can look at:
- Your skills
- Your hobbies
- Websites you visit regularly (you can earn money online too!)
- Tools or applications you use
- Subjects of nonfiction books and magazines you read
I want you to get 50 ideas down on paper. When you have those ideas down, I want you to come up with a specific service you can do for each one.
You might have a skill like, I’m good with dogs?, but is anyone going to pay you for just being good with dogs?
No. Instead, you have to translate that skill into a service like ‘I can help you train your pets’ or ‘I can pet sit for you.’
This is key when you’re generating second income ideas. Think in terms of services as well as your qualities.
Here’s a tip: To check if your service is actually a service, you should be able to explain it by saying, “I can help you (some service) so that you can (some benefit).”
Here are a few examples of qualities that can be positioned as services:
|Great with animals||Pet sitting:??I help you watch your pets while you’re on vacation, so you can relax and enjoy yourself knowing Fido hasn’t chewed off his own leg.?|
|Genius with PowerPoint||Presentation design: “I help you create fantastic business presentations so you can save time and money while looking good for your clients.”|
|Love working out||Fitness trainer: “I help you achieve your health and fitness goals so you look and feel better.”|
To help you even more, I’ve provided a template below, you can use to come up with great second income ideas.
You’ll be surprised at how many seemingly mundane activities can be converted into potential business ideas. Even some people on my staff started their careers by taking regular things they were already doing and simply charging for it.
BONUS: If you want even MORE help generating great second income ideas, check out my four-minute video below where I dive into the topic
Once you have your second income ideas, it’s time to find out which ones people want to pay for and you’ll love doing.
Want to build a business that enables you to live YOUR Rich Life? Get my FREE guide on finding your first profitable idea.
Step 2: Validate your ideas
This is a critical step that MANY people miss. And I’ve seen the results from skipping this step happen time and again: People who are still, months after starting their businesses, trying to figure out why they’re not making any money or progress.
I’ll tell you why: Because their idea wasn’t good to begin with.
You’re not going to make that mistake though. Instead, you’ll invest a little bit of time to make sure that your second income idea is a winner.
To do this, we’re going to use a system I call the ‘Pay Certainty Test.’ The best part You can validate your ideas in less than 15 minutes.
Here’s how it works: Take the paper with your ideas and write down who would pay you for each service next to each one.
- Is your idea “social media consultant for law firms?” A law partner would pay for that.
- Is your idea “career consultant for millennials?” Twenty-somethings looking for jobs would pay for that
- Is your idea “violin instructor?” Parents of musically inclined children will pay for that.
Once you do that, it’s time to ask yourself two questions:
- Is my prospect willing and able to pay me for this service? (Demand)
- Am I willing and able to provide this service? (Supply)
Where those two questions meet is where you’ll find your good ideas.
So take, social media consultant for law firms. “Will a law partner be able to pay” Of course. Law firms have more money than God.
Are they willing to pay money for a social media consultant? Probably not. Law firms don’t typically care about social media. They recruit and market themselves through other means.
Verdict: Eliminate the idea.
What about something like “violin instructor?” Are parents able to pay? Yes. The parents who are able to buy a violin for their child are going to be able to give money for instruction.
Are parents willing to pay? You bet. These parents will spend virtually anything to make sure their child is well-rounded and successful.
Verdict: Great idea! Pursue!
Use the Pay Certainty Test for all of your ideas. Once you do this, write down all of the ideas that passed onto their own ‘good ideas’ list. Don’t worry about the other ones. They’re not permanently rejected and you can always revisit them later if you want.
For now, though, you should have at least three to five potentially profitable second income ideas.
Now pick the one you think is best.
I know. It’s like choosing which child is your favorite. But, at this point, there are no wrong answers. The important thing is you choose one and try it out.
Once you have your second income idea chosen, now it’s time for my favorite part: Finding your first client.
Step 3: Find your first client
Once you have your second income ideas, it’s time to start putting your ideas to work for you, and you do that by finding your first client.
While it may seem daunting to start selling your skills, it’s actually pretty straightforward as long as you have the right systems.