Friday, January 25, 2013

Your Time Is Limited:

When looking to make more money, people often look to increase their working time. So they work two jobs, produce items cashing in on hobbies. Basically they work harder.

Working harder is NOT working smarter.

The problem is that time is finite, there are only 24 hours in any day. You cannot work all those hours physically and you have a finite capacity to create cash flow doing one thing at a time.

Say for instance you work a full time job for $20 an hour. You want to increase your earnings per day to give you an extra $20,000 per year.

You decide that you like knitting so you will sell your knitted products on eBay or ETSY in order to make up that $20,000.

$20,000 means you need to work at least 1,000 hours per year, that is just over 2 hours more per day, if you pay yourself your earned wage rate. And you knit all night anyway now just to relax.

But you also need to buy supplies of yarn. You need something to knit and one ball of yarn make one hat at $9.00 per ball. So already you need to sell your hat for $29.00 to make up your demanded earnings.

That is if you can make one hat per hour.
If it takes you three hours to make one hat, your cost is the same $9 for yarn but you require eanings of $60.  Is anyone going to buy your $69 hat?

You have worked harder but not smarter.

You need to look at residual income as part of your policy.  Generate income from areas where you do not need to be actually spending time working.

Look to income from stocks and bonds. They generate monthly and quarterly income. Say you have a bond portfolio that pays you a dividend of $20 per month. That is one less hour you need to work per month, or one and a half days (if you work and eight hour day) per year.

Affiliate programs online such as with Amazon, Zazzle, Go Daddy and Host Gator can pay you income two and you don't have to do much other than drive traffic to them to buy their goods and services.

Affilliate programs do require some work bot one houe spent blogging on your website to drive traffic is an hour well spent as it is always there, unless you delete it.

With these sources of income working away in the background you can use that income in order to either reduce your demanded income from your hobby type sales on eBay and Etsy.

Generate income from various means. Write blogs and generate income from advertising with programs such as Google AdSense.

The more streams of income you have the less reliant are you on any one stream.

Make sure you really make the most of every hour in the day.

Work smarter,not harder.

Tuesday, January 15, 2013

Cash at the Local Library

Do you visit your local library?

How often?

If you are in your local public library right now, how about approaching one of the librarians and asking if they have a books for sale area or shelf.

Many public libraries sell their less popular books. This process is called weeding  within the library service. Like a weed in a garden a book which stays firmly on the shelf in a public library serves no good purpose. Like a weed in a garden it steals a vital resource, space on the shelf, instead of space in the vegetable plot or flower bed.

These weeds do serve one purpose for a library, they can sell them at a much reduced price and recoup some cash to fund buying of new and hopefully more popular books.

Libraries "weed" between one fifth and one third of their books in any one year. This means that millions of books are available across the US everyday in city public libraries.

You can pick up books for a few cents for childrens books or a dollar or two for a bestseller.

This little goldmine can be yours for the asking. Invest a few dollars in some of these weeded books and take a trip to your computer and EBAY or one of the many online auction sites.

Library books carry library marks, stamps and you may find a torn page or children's books have crayon marks. It's a risk.

Leave torn and crayon marked books on the shelf but books in reasonable condition even with library stamps and such can return a reasonable profit on EBAY.

For a small EBAY fee and the price of postage and packing you can maybe make 50% or more on some of the more popular authors books.  Fans of authors will buy books that are out of print to read. A collector may buy even a marked first edition if it is all that is available for the price.

You won't get hundreds or thousands of dollars for a first edition book with library marks, but if you get $10 for a book you paid $2 for, then don't fuss. Cash is cash and we want to make lots of little profits like that one.

For other ideas as to where to sell old library books see my article at Yahoo! Voices

Wednesday, January 9, 2013

Municipal Bonds

In the United States we are lucky to have a small group of investments called Municipal Bonds or Muni's.
California State Capitol Building, tall building front collonade looking up to a high domed roof. Building set in parkland, looking across lawns and tall tree to left of image.
California State Capitol Building

These bonds are issued by public bodies such as cities and states to raise capital for public works, for instance a college wishing to raise funds for a sports stadium may issue a bond to pay for the coast by raising cash.

You buy the bond and receive income in the form of a dividend then after a period of time you may receive the face value of the bond when the appropriate repayment date is reached, or at any time you may sell your bond to the bond market for a sum of money.

This is very simplified of course but you get the idea.

You may invest in a single bond or in a Exchange Traded Fund (ETF). An ETF contains a basket of many bonds from across several grades and sources.

Most Municipal bonds dividends are free of both Federal and.or State income tax so provide a good source of income for anyone looking to increase tax-free income.

Many bond funds also pay dividends monthly so a regular income can be received.  Buying an ETF also allows you to spread the risk of any single bond failing to pay its dividend and so losing its value.

Buying bonds always carries risk so in the past I have spread the risk buying a single state bond fund and also a national bond fund on the  Wall Street market. Both funds have been free of all taces, at present Congress may change the tax liability of Municipal bonds, you should check as to liability at the time you decide to purchase.

Bond funds do require an original investment but if you are able to take advantage of dividend reinvestment plans you can rapidly increase the value of the account by buying more stock with each monthly dividend payment.

The value of bond funds does move up and down as the value of underlying bonds varies and as stock market conditions dictate so purchase value cannot be guaranteed over the short or long term. If you can leave the original investment alone for several years the likelihood is that you will profit from the purchase and the income bonds create.

Municipal bonds can play a role in any  Dividend Paying Portfolio   plan.

If you would like more information as to the possible benefits of Muni's to your plan for increasing residual income, consult a financial advisor who is familiar with your tax and investment liabilities. This blog post should not be considered financial advice for any individual or group of individuals.