If you read my New Years post, you know that relocation will likely threaten my single source of income in the not too distant future. Despite being married, I have never been without my own source of independent income. I’ll be honest. I like life’s luxuries, and the reality of life in one of Australia’s major cities is that you need two incomes to survive, let alone thrive (and afford a few luxuries).
So, my 2012 goal is to build a location independent income. But what is a realistic goal? Replacing my job income is not realistic. So, instead I’m going to target the social safety net income that would be available to me, if I did lose my job.
That’s right – The amount of Centrelink’s Newstart Allowance.
For a single adult with a dependent child Newstart Allowance for 2012 is $526.60 per fortnight. I’m going to take a few liberties with rounding and target an income of $1,000 per month. I have to be honest, that feels like a stretch target, but I would rather fall short of the $1,000 per month than easily hit a goal of $200 per month and wonder how much further I’d be along the path if I’d pushed myself.
Besides, earning a grand per month online as a part time enterprise seems to be possible. Others are doing it, so why can’t I?
Now comes the fun part. The how.
I’m going to borrow a few concepts from the investment world. Financial advisors recommend diversifying your investments, so that if one investment is underperforming you have others that take up the slack. I totally agree with this concept, especially since all my eggs are currently in the “job” basket when it comes to my income.
In the spirit of diversification, I’m going to look for five sources of online, or location independent income, each returning me $200 per month. All five slots may not be filled from month one, but ideally by the end of the year I will have five streams of income producing $200 per month each.
Some of these slots are already occupied, as I’ve been dabbling in the world of blogging and content mills for about a year. None of the slots, however, produce anywhere near the targeted $200 per month. Below are the first two sources of income I will be targeting and three more possibilities that I will either monitor or investigate.
Dividends and Fixed Interest – Target $200 per Month
This category is a very traditional source of passive income. It is listed first for two reasons: I have found success with this in the past, and it is independent of the vagaries of Google and its Panda updates.
Two years ago I sacrificed a stock portfolio of dividend paying stocks in favor of buying a home. I don’t feel that was a mistake, but I do miss the safety net that regular investment income generated. The income generated from those stocks and fixed interest investments generated close to $20,000 per annum. The portfolio was built over a 4 year period.
Given this past experience, and armed with some simple money rules for achieving wealth earning $200 per month in dividends and interest should not prove too onerous.
Google and its Panda updates may not be a risk for this income category, but economic and political upheaval are. With the repercussions of the Global Financial Crisis and ongoing Sovereign Debt crisis in Europe and arguably, the USA, still playing out in stock markets around the world there could be some hairy moments along the way.
Blogging – Target $200 per Month
You will probably have guessed that blogging is another area where I will aim to hit my $200 per month goal.
Last year I started a simple Blogger hosted blog. It was all about learning about making money online. I did no keyword research and did not use social media or worry about backlinks. I just started a blog on a passion. I did earn a little bit of money, and one month even earned triple digits from that blog, but current income stands at about $20 per month.
I am hoping that over the coming year, that blog’s income when added to this one (a joint venture) will meet my $200 per month goal for this “slot”.
Content Mills – Monitor
I have dabbled in a couple of these, most notably Hubpages and Associated Content (which recently re-branded to Yahoo Voices). Both were hit by Google’s Panda updates, and both have made rule or format changes which have decimated the small income I made there.
Both accounts are currently only used for creating links to my blogs, though with each rule change they seem to become less useful even for that narrow purpose. I think I may have missed the window for earning good online income from these sources, but in case I‘m wrong (it happens occasionally) I’ll continue to monitor the income generated.
Amazon – Monitor and Investigate Hubpages alternatives
As of January 2012, Hubpages removed the ability to earn directly from the Amazon Affiliates program which will reset my, albeit small, Amazon earnings back to zero. Early reports indicate that Wizzley may be a viable alternative.
Amazon’s Affiliate program presents a wonderful opportunity. After all, what can be more passive than placing an affiliate link for a product on your website and earning between 4% and %15 in commission on sales?
Amazon has some distinct advantages as an affiliate program, most notably its reputation. Few online shoppers are scared to order from Amazon or one of its featured partners. I personally do not hesitate to use Amazon to order goods ranging from shoes to an internet ready television. In the case of the television we saved hundreds over buying from a bricks and mortar retailer.
The drawback however? You need to be able to sell. A banner on your site may get you a few random orders, but to really work this income source you need to provide detailed and compelling product reviews. I love the idea of this source of income, but I’m not sure I’m up to the task.
Kindle eBooks – Investigate
eBooks have taken off, and indie authors of both fiction and nonfiction Kindle eBooks are finding success in selling their eBooks without the assistance of a traditional publisher.
There are independent authors making from hundreds of dollars a month to tens of thousands a month. The biggest variables seem to be the size of the author’s library, writing ability and promotional activity.
$200 a month from eBook sales at first glance seems achievable. But do I have what it takes? Perhaps. Perhaps not. Finding out could be fun though.
Of course Kindle isn’t the only player in this market. To get your eBooks in Nook (Barnes and Noble), iBookstore (Apple), Kobo, Sony Reader and other formats look into Smashwords to publish and distribute your eBooks.