If you’re a regular visitor to the BiggerPockets blog, you’ll know that not too long ago, I wrote an article that listed and described a handful of side-hustle ideas. Many of these ideas could make you an additional $1,000 per month, which you could then put away to save.
So this article is basically the same thing, right?
Well, kind of. But not really. There is going to be some overlap, but I am only going to talk about the side hustles that I have done AND that I can confirm make it possible to make (and save) over $1,000 a month in a relatively short amount of time.
The idea here is that you are saving 100 percent of any additional income you are making from these side hustles. I realize that there are tax implications with many side hustles, but that is beyond the scope of this article.
In the following, I will show you 5 ways to make $1,000+ per month in pre-tax income, all of which I have done. Talk to your accountant about the tax stuff.
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Signing up for Uber or Lyft is relatively easy. If you live in or outside of a city, have a clean driving record, and own a car that is under 10 years old, there is a high probability that Uber or Lyft will accept you to be a driver. Within just a few days, you will be on the road escorting people to their desired locations.
This is a great side hustle if you are just starting out on the financial independence journey, you don’t mind driving, and you like meeting and talking to people.
I did this when first moving to Denver for about three months. The purpose was threefold:
- Get to know the city neighborhoods so I could find a place to purchase my first property.
- Meet new people and network with them. I told every single passenger what I did and what I was looking for. It turns out that I ended up meeting my Airbnb cleaner in an Uber ride.
- Make $1,000 or more per month.
I successfully did all three of these things. However, to make $1,000 per month, I had to drive between 80 and 100 hours per month. After three months and closing on my first property, I decided that my Uber driving career had served its purpose and it was time to move on to bigger and better things.
2. House Hacking
For those of you who don’t know, house hacking is when you purchase a 1 to 4-unit residential property with low money down (5% down or less). The caveat to any low-money-down loan is that you are required to live in the property for at least one year.
That’s OK, though!
The idea here is that you live in part of the property and you rent the other parts out such that your tenants (or roommates if it’s a single family home) are paying down your mortgage.
I have yet to find a better risk/reward trade-off. For relatively low risk, it is not uncommon to see annual returns north of 100% when you factor in the four wealth generators of real estate.
My first property was a house hacked duplex that I purchase for $385,000 for only $17,000 down. In the first year, my cash flow including rent savings was close to $12,000—not to mention the loan pay down, the appreciation of the property, and the significant tax savings due to depreciation and write-offs.
Since I was able to save so much during my first house hack, I was able to purchase a second one—a 5-bedroom, 2-bathroom single-family home that I purchased for $343,000. I rent it out by the room, and it cash flows roughly $1,400 per month when you include rent savings. This excludes loan pay down, tax advantages, and appreciation.
There are countless other successful house hackers out there with returns as good or even much better than I am getting. It really is a tried and true way to eliminate your largest expense and save $1,000 or more per month.
3. Rent Hack
This is a term that I made up, which may or may not stick. But many people cannot yet afford the down payment on that first property. So what do they do? They grab a box of Twinkies and continue watching season 9 of Friends (again).
But what if we thought outside of the box a little bit? What if you searched for a 3 to 4-bedroom apartment (or house) to lease and then found roommates to rent it by the room to?
Let’s take an example. Note that the numbers here are just for reference—they will be different depending on where in the country you live.
You are currently paying $800 to rent a studio apartment downtown. Instead of re-signing this lease, you decide to find a 3-bedroom apartment or house in a cheaper part of town. It’s $1,200 for the 3-bedroom place, which you sign the lease for. You then turn around and rent the other two rooms out to two other individuals for ~$700 each. Now your roommates are paying $200 more to you than the rent payment, and you are getting paid to live!
Before you go do this, note that you MUST and I mean MUST tell your landlord that this is what you plan on doing. Be straight up. If you ask around to enough landlords, I’m sure you will get a yes. You may need to negotiate a little bit, perhaps give them higher rent or be a property manager for them, but either way, it’s well worth it!
4. Airbnb Arbitrage
Airbnb arbitrage is the cousin to the pre-house hack. I am doing this right now with my friend as we speak. He owns a condo that is in a great location. He rents the property out to me, and I turn around and put it on Airbnb.
I do all of the work in terms of scheduling the cleaning crew, talking with the guests, fixing small things, and making sure everything runs smoothly. He only does landlord duties, which entail communicating with the HOA and any large ticket items in the unit.
Every month, I pay him a monthly rent plus 10% of the net profit made from Airbnb. I keep the 90% from Airbnb. In the summer months, I make upwards of $1,000 to $2,000 extra, whereas in the winter months it is $300-$500.
Turo is the Airbnb for cars. So, if you are taking public transportation, riding your bike, or walking to work everyday, then this may be a great option for you. The idea here is that you let other people rent your car out for a couple of days to a couple of weeks.
Just like Uber and Lyft, there are requirements that allow you to place your car on the site. Cars must be no more than 12 years old and have less than 130,000 miles on them.
Related: 12 Reasons You’re Poor
I had my car on Turo for about 15 months. In the summer months, when you include penalties for mile overage, you could make well over $1,000—and in the winter, slightly less. However, after you factor in your gas savings and the health benefits of walking or biking to work, I’m sure you’ll realize at least $1,000 per month. Or pretty darn close.
There you have it. Five different ways that, in the past two years, I have found to save $1,000 or more per month. While there certainly was a lot of creativity involved in some of these ideas, they are replicable and almost anyone can do them.
It is a little more work, but what do you expect? To get $1,000 a month for nothing?! Almost all of these ideas (except Uber/Lyft) require work up front, but over time you can put systems in place such that you remove yourself from the business and simply realize the cash flow.
I hope that this article got your wheels spinning and that you can take some of the ideas and implement them into your own lives.
What clever ideas would you add to this list?