10 Best Ways to Make Money Online
I know, I know, you’re already happy at your day job, and you’re sick of all of this live-and-work-on-a-beach-with-a-piña-colada-and-free-blowjobs lifestyle everyone keeps raving about. Well, then, this article isn’t for you.
BUT, if you’re like those who email me constantly with questions like: “What’s the best way to make money online?” “How do you travel so much?” “How do you earn your income?” “What do you think of my business idea?” “How do you look so handsome all the time?” — then stick around.
Trust me, I hear you. And don’t worry, my handsome ass is here to help. I’ve been making money only for about five years, and earning a full-time living for four. But more importantly, I’ve met hundreds of people who are successfully pulling off the caper and laughing about it on a beach somewhere, piña coladas and all.
A few important points: For the most part, all of the items on this list have a few things in common. For one, they can’t be learned in school (the exceptions are programming and design work). You need to be able and willing to educate yourself.
The second thing they have in common is many of them require a lot of runway space to get off the ground. Many of them will also involve a lot of trial-and-error. Persistence is key. Anybody who tells you that you can be making a ton money off an online business of your own within a few months is lying to you. It takes years of hard, thankless work to get anywhere in any of these skills and to turn them into a long-term career.
And the third thing they all have in common is that they’re all extremely scalable. That means that the potential for growth is fast and the ceiling is in the stratosphere. So while you may starve and move back in with mom for a couple years until you start making money, you’re far more likely to be a millionaire in the next 10 years doing one of the things below than you would be at say, working at an insurance agency or managing a restaurant.
Below are the 10 best ways to make money online (in no particular order), complete with pros, cons, examples and snarky comments about each one. Happy Kwanzaa.
1. Software Development
Programming itself is becoming outsourced to places like India. But a software developer sees the broader picture and is able to manage and apply different programming jobs into a larger cohesive project or application.
The big boom area at the moment is web development and mobile applications. There are thousands of businesses out there who are under-utilizing their web and mobile presence and have tons of money to throw at it. That’s where you would come in. As there aren’t enough developers to meet the demand at the moment.
Pros: High demand and big pay days. There are a couple of software developers in my mastermind group and they’re regularly bantering about five-figure projects they’re working on. Also, software developers are integral to any start up, meaning that the skill-set will often net you an equity stake in many of the start ups you hop aboard.
Cons: Must be highly qualified to do it. It’s probably the only thing on this list that you HAVE to go to school for at some point, unless you’re just a prodigy or something. The other big problem with software development is that if you’re going to get out of the cubicle, you’re going to need some connections and big ticket clients to get you out the door. Almost everyone I’ve met who is making this work started out at a larger company, bailed and brought a few clients with them to get them going. Unlike some other skills, freelancing on Elance or oDesk will not be lucrative, as you’ll be battling all of the $10 and $12 an hour Indian developers.
In my opinion, copywriting and being able to sell through words is one of the most all-around useful skills on the internet and possibly life.
Copywriting is being able to write in such a way to persuade people to do something — sign up as a member, buy a book, open up a magazine, join the military, send your bank information to a stranded Nigerian prince, and so on.
One of the internet’s virtues is that it decentralizes information, giving everyone a voice and allowing everyone the opportunity to share something useful.
But now we’re overloaded with information. The battle is no longer to get an outlet to be heard like it used to be. The battle is to hold people’s attention. It’s a skill that will soon become indispensable. Once you can sell well, you’ll always make money, no matter what business you’re in, or where you are. Whether you’re selling hubcaps or vacation packages to Tahiti, human psychology never changes.
Pros: Low barrier to entry: Anyone who can write decently can get started. Applicable to almost any business you can imagine, and there’s always a shortage of really good copywriters. Because of this, great copywriters make some serious bank. Some of the better one’s I know regularly get paid five-figures PLUS a percentage of sales often for only writing a couple thousand words.
Cons: A long learning curve, especially for someone who isn’t already a good writer. Also can feel a bit soul-destroying when you’re writing yet another salesletter about women’s socks just so you can pay that month’s rent. There’s some competition, but you can get started freelancing in places like Elance or oDesk for a few hundred bucks and then eventually use those connections to start moving up the pay ladder.
3. Internet Marketing
Likely you’ve heard these terms bandied about: affiliate marketing, search engine optimization (SEO), pay-per-click, social media. Chances are you’ve been inundated with more annoying banners and pop ups than you’d ever care to recall over the years.
Yes, those are the internet marketers. Internet marketing is the art of pointing eyeballs at a certain piece of online real estate. Whether it’s through advertising someone else’s product for a 50/50 cut, ranking sites for popular keywords to sell your own advertising, or drive people to an email list to pitch them on penis pills, internet marketers are always culling people and pushing them towards a certain something. And that something usually makes them money. Most marketers specialize in a specific area (SEO or affiliate marketing), but some have their hands in all sorts of pots.
Pros: You can get very creative with the amount of opportunities out there. If you’re easily bored by repetition, internet marketing will always throw new or unique situations at you to make money. Most opportunities make little or no money, but sometimes you can hit the lottery.
Cons: Internet marketing can be used for good or evil. There are definitely some unethical ways to market to people (spamming and scamming). Internet marketing is also unpredictable. You can work on a dozen projects over a year and earn nothing, and then suddenly have a tiny project you didn’t care about make six figures. It’s difficult to decipher whether you suck at it or are just unlucky. A lot of people fail consistently for a couple years and then give up calling the whole thing a ruse out of frustration.
4. Consulting and Coaching
The best thing about the internet is that any knowledgeable person can put themselves out there and teach others. The worst thing about the internet is that any knowledgeable person can put themselves out there and teach others. For every true expert out there, there seems to be at least a dozen wannabes or outright frauds trying to make a buck. As a consumer you have to be careful.
But I’m not just talking about the old, tired cheesy “life coach” types who claim they can change your life and make you a millionaire in only a few hours. There are a lot of legitimate consulting practices that can earn a lot of money. The business world seems to be the top of the pyramid (a friend of mine gets flown around the world for free AND banks mid-four-figures for a weekend of work consulting leaders at major corporations).
But below that there are booming industries in health/fitness, PR and marketing, tech and even therapy practices done online through Skype.
Pros: Flexible schedules, big-time corporate clients means big bucks, if not location independent then travel expenses are at least paid.
Cons: You need a legitimate expertise and a lot of credibility to get going — two things that are not easily come by.
5. Web Design
I sometimes joke that if my primary business (this blog) went under, I’d become a web designer. Partly because I love doing web design. But also because that industry is such a racket right now. I can’t tell you how many people I’ve met while traveling who have asked me to take a look at their website and it’s been absolutely horrible. Ugly. Non-functional. Totally not user friendly.
Then they tell me how much they paid for it and my jaw drops. “I’m in the wrong business,” I usually say.
The fact is, most people hire people to build a website because they know them. There’s no centralized expert design firm or anything. There’s no industry standard. And the clients have no idea what makes a site good or bad, so they just make due with the lump of crap that’s handed to them.
I’ve done a number of site design gigs over the years. Most of them I did for fairly cheap because they were for friends or people I met. But others I made a pretty penny.
Pros: The bar is so low right now that anyone who teaches themselves CSS, HTML and how to install and customize WordPress is going to be halfway there. Web design can be fun too.
Cons: Screwed up market. People hire you because they know you, not because of your resume or track record, so you have to hunt down leads one by one. You can use the freelancing sites, but again, you have to compete with the Indians and Filipinos at a discount. But on the other hand, because of how many incompetent designers there are out there, you can get away with charging a lot more than you probably deserve. It’s the wild west out there.
People start blogs with big dreams: easy money, internet celebrity, popping champagne bottles with P. Diddy. Unfortunately none of these things ever happen.
Let’s make this easy: Blogging is not a business plan. It’s a hobby. And if you’re lucky, it starts making you money one day.
People don’t realize that blogging has a ridiculous ramp-up time — it took me almost three years of writing every week to even reach 1,000 daily readers. That may sound a lot, but in the blog world, it’s not. If I didn’t have my coaching work and my freelance web work in that period, I would have gone broke and given up. In fact, even WITH my coaching and web work, I still almost went broke and gave up.
Freelance writing gives a more immediate pay day, but it can be just as frustrating, just in other ways. Most major mainstream publications (Huffington Post, CNN.com, Salon, etc.) allow anyone to submit their story ideas and possibly get paid for them. The competition is thick though, and even if you do manage to break in, the pay is squat. Editors change your work and sometimes they don’t post it for months. It’s not a reliable or stable income.
Pros: If you love to write, it doesn’t get any better.
Cons: No matter which way you go, there is VERY stiff competition. You have to be an excellent writer and you have to be able to do it at the drop of a hat. If you’re good and persistent, you’ll make it. If you’re not, then you’re just going to be frustrating yourself.
Many people don’t know this, but I spent much of my senior year of college playing poker seriously. I never turned pro, but I did turn $50 into about $5000 in less than a year.
Coincidentally (or maybe not), I’ve spent a fair amount of time around poker pros. My assistant is a former professional poker player. Many of my former dating coaching clients were professional poker players. Friends of mine have taken a stab at going pro and come close and failed.
Poker is easy to get good at but incredibly hard to be great at. Good will make you a little money, but being great is what makes you the big bucks. The earnings in poker scale exponentially. So the difference between being “pretty good” and “really good” can mean hundreds of thousands of dollars over the course of a few years.
But getting to that “really good” level will require years of practice, analysis, studying, stress and discipline.
Pros: If you love it and are good at it, it can mean a lot of “easy” money after only a couple years of studying and playing. You have to take it seriously though, like you would a job. Also, if you start traveling, you get access to a lot of softer poker sites that aren’t available in the US due to restrictions, so it actually works in your favor to be abroad. Also, most foreign casino games are hilariously soft (I spent a couple weeks in Ukraine and paid for my entire time there with a few trips to the local casino).
Cons: As with any sort of gambling, there’s always the risk of going busto and losing everything. Poker can and likely will destroy your social life for stretches of time. Prepare for major emotional upswings and downswings depending on how well you did at the tables that day. It’s not an “easy” or “stress free” life like it would seem.
Did you know there are housewives and old retired men making a full-time living flipping stuff on eBay? Me neither. But there are. Ebay is good for two things: finding ridiculous deals and finding ridiculously unique items. If you leverage that then you can make some good money.
If one is knowledgeable enough (and I suppose has enough free time), they can scour eBay for under-priced items and then flip them for a profit. One can also take them and sell them through consignment through local brick-and-mortar places.
I’ve never done this and from what I hear, it’s getting less viable than it used to be, but it can be done. In fact, I believe I read that this is how Chris Guillebeau got started online, way back when.
9. Stock/Options/FX Trading
People who trade for a living are rare. This is because anyone who’s not good at it quickly loses their money. But when you’re good, you can make a helluva lot.
The catch is that 1) you have to love it, 2) you have to spend an insane amount of time educating yourself about markets, and 3) you have to be willing to deal with the insane emotional stress of making $20,000 in an afternoon and then losing $30,000 that night after dinner. It’s like poker stress times five.
Periodically, I pick my friends’ brains about this stuff because I find it interesting and this is what I’ve gleaned: There is a lot of SHITTY information out there. So much, that you’re better of just learning the fundamentals and then observing and developing your own principles and ideas based on your own experience and observations. You’re never going to learn more about a market than everybody else, and there are always going to be insiders who have more information than you. So the best you can do is learn to watch the trends among the other trades and react based on those.
ECommerce sites are basically shopping sites. Think of Amazon as the ultimate ECommerce site. It may be a store for sports supplements, wedding decorations, or cat furniture, but it’s a store set up online for shopping.
Drop shipping is when you outsource the actual manufacturing and inventory to a factory that you have no affiliation with.
For instance, let’s say I want to start a business that sells scarves. I can outsource the actual manufacturing of the scarves to a factory in China, and then connect them to my US-based online store. So when someone orders on my store, the factory automatically churns out the product and ships it over.
There’s a lot of logistical hassles involved in drop shipping businesses. There are also higher start up costs and more ways things can go wrong. One must be certain that there’s a strong market demand for whatever product they want to sell or you can lose money quickly.
But once drop shipping businesses are off the ground, they’re usually sustainable and consistently profitable. It’s how Tim Ferriss originally made his money. It’s also how TropicalMBA founder Dan Andrews makes his.
I suppose you could say it’s the kind of online business that most resembles a “real business”. And if you have a family like mine, that could be a good thing. Happy Holidays.
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