When I read your post yesterday, I thought what can I say that has not already been said. Your question by itself was interesting, and am certain many here have asked a variation of it at some point in their life. I know I did.
For some ‘money’ implies dollars, euros, pounds, pesos, bitcoins, etc. I prefer to think of ‘money’ to include monetary currencies along with trust, time, credit worthiness, self ability (skills), self interests (passions), personality and health to list a few. In our every day activities we essentially barter one set of ‘personal currency’ for something equivalent/better.
e.g. with my skills(not necessarily passion) get W2 income; with trust/credit worthiness obtain a loan; with passion/skills/trust convince a VC to invest in the next round; with time/dollars support organizations I am passionate about.
The best person to answer your original question is YOU!
What works for others need not work for me. It is also worth noting what worked in the past may not be applicable today for a simple reason – my interest/passion changed.
Since I can not provide concrete examples to make more money, I will reply with my thoughts to a variation of your question I had when I was in my 30’s (AARP is eager to add another household to their mailing list soon).
Here was my self assessment:
– I am a lazy person (please don’t mistake that – I seek challenges, and will solve them with the most efficient solution as quickly as possible, with minor fine tuning along the way to perfect/automate the problem)
– value time more than monetary currency (will take reduced pay to keep my 15 minute commute)
– can become passionate/knowledgeable about almost anything (within limits)
– my investment inclinations tend to be valuation driven and contrarian by nature
– have a constant paranoia it will only become difficult as I get older to find interesting workplaces
With this newly acquired self awareness I chose to do reverse analysis on the problem at hand – ‘what do I want to do at age X?’ and most importantly ‘what support will I need to maintain my goals at that said age X’
Now that I had a magical $ number to support life at X, I started looking for diversified opportunities across the spectrum to generate my magical $ number. Typically a $1 saved is $1.33 earned, which simply dictates to come out ahead/even in the game one has to find legal options to minimize the ~30% deficit. My end goal is not to amass wealth, but just enough to support my/spouse lifetime along with a 5% surplus to kick-start the next generation.
Few other random thoughts:
– consider a 9-5 job as a spring board to reach ones goal. This helps to build ones personal currency of trust, credit worthiness, skills. Most importantly helps to sort out what one’s likes and dislikes are.
– it takes money to make money. I know it sounds a cliche. So will amend it as ‘it takes personal currency to make money’.
– The best currency to have anytime is Other Peoples Money in the form of loans, goodwill etc
– look at your 1040 to understand above line deductions and below line deductions.
I can’t speak for you, but if I were in your position my action plan (UNLESS my current rent was ridiculously below market) will be to
– buy the largest house I can afford in the best neighborhood I desire. Note, this can be the smallest house in the neighborhood. Ideally prefer not sharing the land rights with anyone. By choosing the best neighborhood I also insulate from possible market slowdowns
(or)
buy a place with best attributes in an up and coming area. This follows the concept money is made where no one is looking.
– maintain the place as primary residence for at least 2 years, depending on market conditions sell and pocket up to $250K tax exempt profit and move to another primary residence (rinse and repeat). Now how to maximize the tax exempt profit is an exercise on its own.
– if selling is not an option, rent the place and move to a newer/upscale property after 2 years, collecting rent against the mostly low fixed rate costs.
– Personally will not consider drastic career changes. For example Mortgage broker business might look lucrative (I don’t know if it really is). But switching from SE to an unrelated business often times we forget to account for the ‘opportunity cost’. The time preparing to enter a new profession, cost involved to become proficient in the new business (note even if one went to the best of school for the new profession one will still be the ‘new’ guy in the business); and in the mean time the SE skills become outdated in case I chose to return to the programming world.
Now if real estate is your interest and you are not willing to commit, one idea (which I can not vouch for) is to try the AirBnB route. Assuming you can lease a nice desirable property, which allows subletting/etc and have funds to make upscale furnishing selections, and a support team to complete move-in/move-outs there might be some money to be made. Obviously consideration needs to be made for taxes from the money made, business licenses etc.
If software development is your dream there are plenty of options to explore. With the latest technologies it is quite easy to experiment rapid developments and test market. There are several interesting nascent domains that are worth exploring – internet of things, machine learning, robotics. Look for old forgotten problems that can use some disruptive technology.
Well I hope there was some useful information in here for you to brain storm your money generating ideas following the ‘no pain no gain’ principle. Good luck!
