Your Money_ The Missing Manual - J. D. Roth [56]
Taking a Second Job
One of the best ways to earn extra income is to get a second job. Earning a few bucks in your spare time is a great way to boost your cash flow, and it's something that almost anyone can do.
Some people don't like the idea of a second job; they feel like it's beneath them. But if you can get over that, it's a simple and straightforward way to bring in predictable income. You should be able to find something you're willing to do at a place that needs part-time (or even full-time) help on evenings and weekends: a bookstore, coffee shop, amusement park, whatever.
When I needed extra income to pay off my debt, for example, I taught myself computer programming, and then landed a part-time job using my new skills. And I know a biologist who picked up a few hours a week at an upscale clothing store (which let her earn extra cash and use the employee discount to save money on her wardrobe).
Working a second job involves less risk and planning than some of the other ideas in this chapter, and it's likely to cause you far less stress than your main job. But before you go out and pick up a shift at the local Starbucks, make sure your regular job doesn't have a policy against moonlighting. It's not worth jeopardizing your career over a job at the Kwik-Mart.
For tips on landing the perfect second job, head over to the Good Morning America website: http://tinyurl.com/2ndjob.
Working for Yourself
Working for a big company isn't for everyone. In 2008, there were 29.6 million businesses in the United States. According to the Small Business Administration, about 75% of these had no employees. That means that three quarters of all American businesses are owned by people working for themselves.
People choose self-employment for lots of reasons. Some can't stand working for somebody else. Others see it as an opportunity to make more money. And a few recognize it as a way to do work they're passionate about. Working for yourself can be freeing, increase your income, and let you focus on doing what you love. But as wonderful as self-employment is, there are plenty of pitfalls.
The Pros and Cons of Entrepreneurship
There's a big difference between doing what you love as a hobby and having it for a job. When you make a little money from your hobby (see Money-Making Hobbies), that's extra income, which is part of the fun. But when you flip the switch and it becomes your sole means of making a living, some of that fun vanishes—sometimes all of it disappears.
Working for somebody else is like renting an apartment, whereas working for yourself is like owning your own home; both have their rewards and drawbacks. Having to generate your own income can add a lot of stress to your life: You have to draft the business plan, find the customers, send the invoices, and pay the bills. Sure, there's pressure when you work for somebody else, too, but there's also a sense of freedom: You're not responsible for the daily decisions, and if you don't like the job, you can quit. Plus, unless you're in sales, the actual source of income probably isn't your responsibility; it's something management worries about.
Despite the downsides, owning your own businesses can be tremendously rewarding, both emotionally and monetarily. The authors of The Millionaire Next Door write that, "self-employed people are four times more likely to be millionaires than those who work for others."
If you decide to make the leap, be careful. Take your time, do research, and make smart choices. Here are some other things to keep in mind:
Have a plan. Just as a budget is important for your personal finances, a business plan is key to entrepreneurial success. If your business is small, the plan can be as simple as a list of goals. But if you're looking for outside funding or hope to take over the world, your plan needs to be as detailed as possible. You can find free sample business plans at www.Bplans.com.
Don't quit your day job—at least not at first. If possible, start by going solo on evenings and weekends to get a feel for your business