Earn Extra Cash - How to Make Serious Recurring Income

I have decided to begin a Hub series on how to earn extra cash legitimately from home or in your spare time. This hub series is a complete action plan on getting rich. It provides information on a way of building and thinking that can assist people in building an additional income source or improving upon their already established business models.If you use the ideas and complete the action items you will no doubt be in a much better position to earn serious money in your spare time or full time.

Although it is a short action plan, I will describe key actions that you must do, as well as some very important thinking processes which if done effectively will help you to establish a solid and sustainable income source.

Once you are done you should:

• Have a good perspective on 3 legitimate business ideas which provide you with a serious long term residual income source
  
• Know how to plan your current path to success in those business ideas.
• Learn the 6 Disciplines of Financial Management and ways to prepare each one.
• Have the ability to analyze your new income sources, and establish contacts to help you grow rapidly.
• The ability to improve upon the new and existing income sources.
• You will be able to decide if working from home is something you should be doing in your spare time, or as a full time endeavour.
• You will be able to analyze new business ideas with a clear thinking process.

Whatever the income source(s) may be that you have or are thinking about, it is important to remember that it’s not the idea or model you use that is most important, but it is your desire and your willingness to produce results that will make you successful. I will provide some very good ideas as I go along but you have to be able to decide what is best for you.

When I first began a home business a few years ago I tried many things. I started with a simple internet business. I began with affiliate marketing just to learn the art of it, and to see if it was for me. In my first year of teaching myself to design websites, blogs, and to get traffic to my sites with paid and non paid advertising like PPC, my best week was about $700 in profit.

Not bad, but I quickly learned that by spending all my nights and weekends doing this, I was unable to balance work and personal life. For the amount of work, it was not worth the commissions and I did not want to get into “black hat” marketing techniques. For example, SPAM.

I realized that if I continued to sell other people’s products, ideas or services that I was in fact building someone else’s business and was not building my own. I was also simply trading time for money. This led me to develop a new approach to earn extra cash and build a long term sustainable income source.

The first part of this action plan in creating a new income source is to do a self analysis on your income sources right now.

For example, when I first started trying to make money online, I knew that if I stayed on the road I was on simply as an affiliate marketer I might make money, but I would fail in the long term for two reasons.

1. I would need to continue to work on it every day in order to get paid large sums of money.

2. It did not provide me an infinite variable to my income equation. I will explain what I mean by that more clearly in my other hubs.

For the type of person I am, and with the amount of time I have to work on building additional income sources, I decided I would discontinue trading time for money in my home business. This does not mean I wanted to quit my day job, it simply meant I would build new income sources that produce residual income, that continues to grow when I am not spending time on it.

A simple example of this is writing a hub like this. As you can see there are ads that are on this page that I get commissions for. As long as people continue to read this hub and click on links I can make money for work I did one time only. That is a simple example of recurring income however it is not a way to get rich and one reason for that is because it does not grow on its own which I will show you later. If you want more information on recurring income you can read one of my other hubs called Recurring Income Secrets.

As an Affiliate Marketer you can make money but depending no how you set up your business you could simply be working for other people and building their dream for them, and only getting paid for the amount of work and effort you put into selling other people’s products.

There are ways to get around this so you are not simply creating a home business that owns you. You see, I thought I was building a long term income because my websites would always be online so the more sites I had the more money. The problem with this idea though is I would only get paid if I continued to work on updating the information I had online.

This is because major companies like Google and Yahoo search engines have learned to penalize web owners who develop stagnant websites, and reward people who continue to develop new content and improve their long term Search Engine Optimization (SEO) to get traffic. You can’t sell without traffic, and it takes a lot of research and time to win with pay per click traffic.

So the first thing you need to do is look at your existing home business if you have one, or job, and determine if you are trading time for money, and/ or building someone else’s dream rather than your own. Whether you are a waiter/waitress, work a construction job, work in an office, or you are an online affiliate or you own a business, simply ask yourself this:

If I stopped working today, or couldn’t show up for a month would I still make money? If not, then you may want to think about introducing recurring income into your income formula.

If you stop getting paid the minute you leave work then you are trading your time for money. This simply means, if you make so much money every hour, and there are only so many hours in a week then you are limited to what you can earn and what you can do. Your options are limited to a simple math formula that can determine precisely how much money you can have, in a particular time frame, minus expenses till then, assuming you can make it to work every day.

To some this concept offers a type of security. Others may plan what they want in life based on how much money they know they will have, and they are comfortable knowing they have a secure financial income source that eventually will get them what they want in life.

Unfortunately their options are dependant on making some risky long term assumptions that,

1. they will always have a job,
2. they will always be able to make it to work,
3. the economy will always be stable, and
4. the company they work for will always be in existence with no downsizing EVER.

In this scenario, options are limited to how much money the income formula has to offer assuming everything falls in place as planned.

Simple changes to one’s income formula can eliminate many of the risky assumptions that some people make, and can make your options unlimited.

Adjust Your Formula Using the 6 Disciplines of Financial Planning

In order to improve your own financial situation and plan, it helps to know some important facts and areas you should focus on. Here are 6 key areas that you need to consider when you adjust your income formula and develop your new income sources.

1. Cash flow – Your cash flow right now is what you have coming in. Now minus all your debts and living expenses. What you do you have left? What you do with your extra money is important in your financial future. There are good debts and bad debts. If you have extra cash you should be investing in good debts like a savings plan or a home business both of which can increase in value and provide long term steady income which can be reinvested. Avoid too many bad debts which will depreciate over time like disposable items.
2. Insurance – Understand that it is estimated that 1/3 of people in the workforce will at some point need to access their savings because of an illness, long term disability, or long term care needs. Invest NOW in some type of insurance whether it is a home business with the ability to make recurring or residual income, or a long term disability insurance plan through your employer.
3. Tax – Did you know that your number one expense is Tax? It’s not your mortgage, it’s not your car payment, it is TAX! So find ways to eliminate tax and you will find money you never knew you had. A good way to benefit come tax time is to either invest in an RRSP or into a low start up – high income potential home business where some of your living expenses and home office supplies, health costs, etc… you probably already use, can be tax deductible.
4. Investments - Investing money is important. You should be looking to put your extra money in areas that can save taxes, improve your “insurance” plan, and provide more cash flow.
5. Retirement – At some point most people want to stop working. You need to invest in something that continues to pay you when you stop working. If you stop now can you have everything you want?
6. Estate – Are you planning to leave behind large debts or a legacy?

So considering the above areas in your life, if the amount of cash flow in your formula let’s say (time x money) is enough to give you everything you ever TRULY wanted in life, and you are not dependant on risky assumptions, you probably do not need to make any changes.

If it is not enough to get you everything you want, than you need to make changes, and there are many ways to do it.

The purpose of this hub is to give people a starting ground on self analysis and to help them decide if they should adjust their income formula by introducing new income sources so they can't reach their goals and do what it is they have always wanted to do. If your current formula does not let you do what you want in life then you may wnat to keep reading. If you decide to continue through my hub series you will find new legitimate ideas to earn serious recurring income, without any experience.

Stay tune for the next hub, or join my fan list to be notified when I have completed it!