Welcome to The Golden Sense! Summer is here and we can all hope for warm weather in the upcoming months. The Santa Barbara college students have graduated and some have left for home. Many try to stick around and get jobs. I think the only jobs in this town are in the restaurant business or maybe at a retail store. The reality is that a paycheck is a paycheck, right?
If there is one thing that Americans need most in today's world, it is INCOME.
We need the cash for rent, food, gas, clothes...you name it...we need it. Gotta get them loafers for work...every lady needs an LBD. That girl just needs some flats...or maybe a pair of TOMS. It all costs money. That's right, US dollars are what is needed by Americans.
Whether you are a teenager, adult, retired, a business owner, or an investment firm, one of the most sought after things today is money. The strange thing about the environment today is that income is as hard as ever to find. Unemployment is extremely high, very few raises are being handed out, interest rates are extremely low and dividend yields on stocks are historically on the lower end. In short, income is hard to come by.
Investment firms are desperately seeking income. The market moves and everyone jumps in with hopes of making a few bucks. Fund managers need the income whether its steady or a one time capital gain. Nothing like showing off their Sharpe ratio to their buddies at the end of the year!
So how do I earn more money? It's a question we all struggle with.
How about a savings account? The road to riches can be found through compounding interest earned on your money. However, the Federal Reserve has held interest rates near zero for the past couple years. This means that it is really difficult for people have THEIR money work for THEM. Do you have a savings account? If so, then you might be making a few pennies on interest. It's just not good enough.
Before we discuss ways to earn extra money, lets take a quick look at how we often lose money.
How do we lose money?
1.Buying unnecessary 'things'
2.Through both inflation and deflation.
3.By owning the wrong assets at the wrong time.
4.By trading poorly.
5.By listening and acting on the wrong advice.
6.By being leveraged in items that are subtly declining.
7.Simply by being greedy, foolish or impatient.
Money is funny. It's easier to move financially backwards rather than forwards. It's important not to lose money. Yet, how can you do the opposite and earn extra money? Like I said, interest rates are low and raises are hard to come by in today's economy.
Lets look at the average young person and see how they can realistically make a couple extra bucks.
If you want to boost your earnings outside the office, we have to think creatively.
1. Clean out your closets.
Rather than throwing your old clothes away, you can sell your shoes and clothing items to a consignment store. Jessica's is a local store here in Santa Barbara. You can always sell these items on EBay or Craigslist.org. Rebecca's friend recently sold a Chanel bag off of Craigslist for a couple thousand dollars. Now that's some good extra cash.
2. Sell your stock photos.
Its easier than ever now. If people often ooh and aah over some photos you have taken, then take advantage of it. Marketing and selling stock photos is an easy way to make a quick buck. Try Fotolia.com, Dreamstime.com or Bigstockphoto.com and upload your pictures.
3. Rent your parking spot.
Do you live in a place where parking spots are a privilege? I live in West beach, Santa Barbara and whenever there are festivals in town such as 4th of July or a Music Festivals people often rent out there parking spots for $20-40 a day.
4. Be an extra.
Ever wanted to be a movie star? Not quite, but you can come close. Sign up at http://www.extratalentagency.com/.
My boss has a son who is in college who is signed up to be an extra. He frequently gets small gigs that land him extra income for his nights out on the town. Some jobs can make you anywhere form $100 to $1000.
5. Be a tutor or a coach.
If you live near a University or school there is often a hidden demand for tutoring whether that be in math, English or any subject. Identify what you can contribute and make the most of it. Tutors can often charge $25 an hour and up. Surf often? Post an ad on Craigslist and teach someone something they've always wanted to do. Make money doing something you'd be doing on the weekend anyways.
OK Todd, enough with the cute idea's.
Question: What if I have an IRA, 401k or a brokerage account? How the heck can I make my money work for me? CD's at banks offer a pathetic interest rate and I don't like the look of common stocks...what can I do?
Answer: There are a few income bearing securities available that have a pretty good return.
The Eaton Vance Limited Duration Income Fund (EVV) yields at 7%. It's currently trading around $16 a share.
The PIMCO Income Strategy Fund (PFL) yields at 6.9%. It's currently trading around $12 a share.
The Alliance Bernstien High Income Fund (AWF) yields at 7.85%. It's currently trading at around $15 a share.
These income funds have a catch. They are priced in the open market and can gain or lose value. As with everything in life, there is risk associated with it.
If your looking for a good dividend yielding stock, check out Teekay Tankers Ltd (TNK). It has a dividend yield over 10%. It currently trading around $9 a share. Teekay engages in the ownership and operation of oil tankers. They are based out of Bermuda (A business friendly country).
Please take note that this is not investment advice. These are strictly observations.
It's not easy for the average person. Joe-six-pack struggles with the lack of opportunities in today's world. It's hard...i understand because I am out there just like everyone else.
The key to extra income is in what you do with it. Income must be used as a stepping stone to move onwards and upwards financially. Yet, one must beware. Extra income holds the trap of temptation. Everyone has wants and needs.
Signing out. I'm off to the warm beach.
T. Norman
The University of Michigan
Richard Russell's view:
We are now in what I call "the great leveling era." This is where the standard of living in Asia and
I believe that from now on the idea will be to hang on to as much of our wealth as we can. In other words, the trick will be to avoid losing money. He who looses the least will be the winner.
Recently-
Mexico won Gold Cup defeating the USA in the final in front of a pro Mexican crowd at a sold out Rose Bowl Stadium. I was not very happy with the US teams' performance. The USA has a lack of depth in defense. One defender gets injured and the whole team can fall apart. Mexico, on the other hand, probably has their best team in the last 20 years boasting Javier Hernandez and Giovanni Dos Santos in their attack. The USA is not in terrible shape, but some recruiting is necessary to step it up a notch.
Ever watched Ice love Coco on the E Network? It's pretty ridiculous, but I am always interested to see what terrible hootchy clothes Coco will wear next. Ice T apparently goes around the country and makes speeches to groups. He told an old joke at one of his speeches... it goes like this:
Once upon a time there were some massive storms in the Midwest. Floods engulfed an entire town. There was a preacher who stood in the middle of the road as water surrounded him. The water eventually came up to his knees. A man with a boat came by and said "Preacher, Preacher, hop on in and let me take you to safety." The preacher refused saying "No thanks, God will save me." The boater then left. The water continued to rise and finally it was up to his waist. A woman came along in boat and said "Preacher, Preacher hop on in and let me take you to safety." The preacher refused saying "No thanks, God will save me." The boater then left. The rain became worse and the water rose to the preachers neck. The man in the boat returned and said "Preacher, Preacher hop on in and let me take you to safety." The preacher refused saying "No thanks, God will save me." The boater then left. The water rose further and the preacher eventually drowned. Up in the sky at the pearly gates the preacher confronted GOD and said "GOD, I never committed a sin in my entire life. I was committed to you and lived a righteous life. Why didn't you save me from that flood?"
GOD replied "You fool, I sent you 3 boats. What more did you want?"
The point- Take your opportunities when they come! They are there.
References:
Barrett, J. (2009) Smart Cookies Guide to Making More Dough. Random House. New York
Disclaimer: The content of this article is provided without any warranty, expressed or implied. All opinions expressed in this article are those of the author and may contain errors or omissions.
No material here constitutes "investment advice" nor is it a recommendation to buy or sell any financial instrument, including but not limited to stocks, options, bonds or futures.
