July is make more money month at Women’s Money Week. I joked on Twitter that it’s “mmmm” for short because of how much I love ice cream and July is also national ice cream month. Whatever your passion, July should be a great month. If you’re new to this site you’d probably expect 20 posts about different ways to make month money this month. But WMW is not about content overload — it’s about taking action. So, there will only be 4 posts about making more money, but I promise they will be filled with killer content that will actually lead to increased income for you. So, without further delay here’s how to decide how to make more money.
About This Week’s Action
In depth preparation is at least 80% of making more money. Most people can’t just wake up and know exactly how they’ll increase their wealth on any given day other than through their regular paycheck. So, this week’s topic is about deciding how you’ll go about making more money this month – because there are a lot of different ways to go about it. Don’t gloss over this post. If you’re committed to making more money, give thoughtful consideration to each step outlined below and you’ll be on solid ground for the really fun part.
Why Decide How You’ll Make More Money
Planning Gives You Direction
If you’ve ever participated in any sort of activity that involved a competition (sports, debate team, mock trial) or even one that has a huge finale at the end (theater or even making a quilt) you know that you can’t just skip ahead to the end result. You have to have a plan. It might be called a game strategy, a trial strategy, a script, or a pattern, but all of these are just types of plans. So why does everyone think they can just start making more money without a plan? I have no idea. But, when you sit down and do some serious planning and decide how you’ll make more money you’ll have direction, and direction is a first step to achieving an end result.
You Have Something to Fall Back On
Let’s say your first attempt at making more money doesn’t work out particularly well. Instead of having to start over from scratch you’ll have a plan in place and know what to try next.
How Long Does This Action Take?
This week’s action will take about 1.5 hours. You’ll need to spend about 15 minutes analyzing your time, 30 minutes setting your goals, and 45 minutes analyzing your previous income.
How to Decide How You’ll Make More Money
1. Know What’s Ahead
There are countless ways of categorizing how to make more money. But this month’s series will fall into three categories:
- Earn more at your current job
- Earn more with side projects and freelancing work
- Earn more with a new job (including a second or third job)
I don’t think that all three of these categories will be right for everyone. That’s why I’m putting them on the table now – so as you go through the rest of this analysis you can make decisions knowing what’s coming in the series and decide which category or categories are right for you.
2. Analyze Your Current Income Stream
I was at a recent conference and one of the speakers said something that I’ve heard before, but perhaps not as succinctly as this:
When you have success in an area, do more of that.
This idea is what underlies the step of analyzing your current income stream. Where does your money come from? I know that you probably *think* you know where you money comes from, but you’ll probably surprise yourself if you sit down and analyze it.
To do this step gather up 1 full year of bank statements (or use an online money management software and look only at your income) and write down the amount earned from the following sources of income and approximately how much time you spent on it:
- Regular Job(s): How much was salary versus overtime? How much vacation and sick leave did you earn?
- Side Jobs: Divide this out by client.
- Interest/Dividends: Which bank accounts or funds were paying the best rates?
- Real Estate: If you’re a landlord, which units are generating the most profit?
- Money Making Side Projects: Perhaps you have other money making projects like a blog or selling items on etsy or ebay. Divide this income out by project.
- Miscellaneous: Lottery winnings, found money, gifts – are there other big sources of income you have?
Did You Have Success in These Areas?
Next determine which of these sources of income was making you the most money overall. Which earned you the best hourly rate? Which was the easiest for you? Which did you enjoy the most? All of these are factors to consider in determining whether or not you have success in that area. Remember, our underlying principle here is that when you have success in an area, do more of that.
3. Evaluate Your Time
Last week’s action step of discovering more time was intentionally crafted to help you earn more money this month. Use the information you learned about your schedule to determine:
- How much time you have to earn more money
- When during the day you have that time
- When during the week you have time
- How you can prioritize and reschedule your commitments to make better use of your time
All of these considerations will impact how you’ll make more money. (Don’t worry, “putting it together” is step 5 below.)
4. Set Your Goals
- Why do you want to make more money? For a vacation, early retirement, so you can quit your job? Be specific.
- How much money do you want to make?
- How much time do you have to make the money? That is, when do you want to be making this amount of money by.
- Can you afford to be wrong? That is, how much risk can you afford to take?
Again, the answers to these questions will help guide you in determining how you’ll go about making more money. For instance, if you need more money to support adding a new baby in your family and you need the money in 9 months, you probably don’t want to start a blog as that’s risky. But if you’re trying to earn enough on the side to quit your job and you’ve been successful with blogging before, then maybe a blog is for you.So, put the answers to these questions into a statement. Write “With 3 hours per week, in 9 months I will be making $60 more dollars each week so that I can support the new addition to my family.” Here’s an additional post that will help you set goals that stick.
5. Put It All Together
Now’s the time when it all comes together. Look at what’s worked for you before, how much time you have, and what your goals are and determine which category or categories make sense for you to focus on: your current income, your side projects, an additional job. Remember, we’ll go through how exactly to do these things in the coming weeks. For now, focus on which is right for you. Here’s some guidance in figuring that out:
Your Current Job: It probably makes sense to focus on earning more at your current job if you already make most of your money from your current job, you don’t have time, desire, or energy to devote to additional projects (or you have time and you’re eligible for overtime), and you want to start earning more money right away.
With Side Projects/Freelance Work: Side projects and freelance work are likely right for you have at least a few hours each week to devote to side work, if you’ve made money on the side before, and if you have time until you need the money.
A New Job or Additional Jobs: Changing jobs or getting a side job is right for you if you need more money quickly, have more than 5 hours each week to devote to getting a new job, and you need a steady flow of additional income.
We’ll dive more into each of these categories in the coming weeks. This week’s focus is to prioritize, plan, and decide how you’ll make more money.
To commit to taking this week’s action, you could simply just tell yourself you’re going to follow the steps in the how to section. But what are the chances you are actually going to find the time to do this, when you have so many other things to do? Instead, you should commit and hold yourself accountable. To hold yourself accountable do 2 things:
- Sign up for the week by registering here. When you “register” for this week’s action on Eventbrite (totally free) it allows us to easily email you twice during the week to help hold you accountable. (If you want to know why you should do this, read this post.) We’ll email you twice during the week to remind you to take action.
- Leave a comment below answering one or more of the following questions: What is your goal statement? Which way of making more money do you think is right for you? And why?
Photo credit: Mrsdkrebs
This post was included in the Carnival of Personal Finance.
Elizabeth is an attorney, freelance writer, ice cream lover, and new mom. She is the former co-founder of Go Green Travel Green and writes for Wise Bread.