By reading this Ultimate Guide you’re already taking the first steps on your journey to a Rich Life. This is only an introduction to the ideas and material you’ll find inside IWT.
I started this site in 2004 while I was studying technology and psychology at Stanford. I’ve spent the time since testing and honing my Rich Life systems on thousands of successful students.
At IWT you’ll learn –
Buy all the lattes you want. A $5 coffee is not going to change your financial life. But learning how to automatically invest, how to select the right asset allocation, and how to negotiate a $15,000 raise will. I believe in asking $30,000 questions, not $3 questions.
Your Rich Life is yours. A Rich Life can be picking up your kids every day from school. Or buying a $1,000 cashmere sweater. It can be buying a round of drinks for your friends, or traveling for 8 weeks per year. You decide. Your Rich Life is yours. (Here are some of my Money Rules.)
There’s a limit to how much you can cut, but no limit to how much you can earn. I have readers who earn $50,000/year and ones who earn $750,000/year. We’ve helped tens of thousands of people earn more money by negotiating their salaries, investing, and starting businesses.
Spend extravagantly on the things you love, as long as you cut costs mercilessly on the things you don’t. I don’t believe in cutting back on lattes. In fact, I want you to spend more on the things you love. What if you could double your spending on travel, or eating out, convenience, or charity? I call those Money Dials and I’ll show you how.
The 85% Solution: Getting started is more important than becoming an expert. You don’t need to be perfect to take control of your money. It’s OK to make mistakes. Get 85% of the way there and move on with your life.
Investing should be very boring—and very profitable—over the long term. I get more excited eating tacos than checking my investment returns. You’re in control. This isn’t a Disney movie and nobody’s coming to rescue you. Fortunately, you can take control of your finances and build your Rich Life.
Money is political. You can simultaneously acknowledge personal responsibility and real systemic problems. This is a core part of the I Will Teach You To Be Rich philosophy. Housing is political. Healthcare is political. Voting rights are political. If you’re looking for bland tips on cutting coupons, this site is not for you. I consider it a tragedy to live a smaller life than you have to. So many of us have been raised to believe that money is something to be scared of. We use phrases like “I’m not good with money” or “Money changes people.” Yes, money does change people.
Money allowed me to dream bigger, to be more generous, and to be more adventurous. It can do the same for you. A Rich Life is lived outside the spreadsheet. What’s the point of all this saving and investing if you’re simply going to wait until you’re 80 to live? No thanks. I believe that once you’ve set up your finances, you’ll see that the most important part of a Rich Life is outside the spreadsheet—it involves relationships, new experiences, and giving back. You earned it. Welcome to your Rich Life journey, I’m excited to see what you do next.
Ditch the Cubicle and Create the Career and Lifestyle You Want
Imagine this scenario 6 months from now:
You stroll into your boss’s office one morning and hand over your two weeks’ notice.
But he says, “Wait, we’ll bump your salary 20% AND give you a corner office.”
“Sorry, I can’t do it,” you tell him. “25% more?”
Nope
“I’m flattered by the offer, but I’m going to have to pass,” you say.
And of course, you found a new job that offers benefits that you can’t put a price on.
The freedom from commutes and evening runs to the dry cleaner. The choice to live wherever you want. And the flexibility to control your own hours.
You’re going to be working from home.
This isn’t something that “other people” do. Forbes reports that 12.7% of full time employees work from home.
Who are these lucky folks who get to work from home?
- They’re people on payroll with a company – everyone from assistants to managers and even executives
- They’re freelancers with skills that are in high demand
- And they’re business owners who make tens or even hundreds of thousands of dollars a year with nothing but a laptop and internet connection
They’re the new class of professionals who define success as doing what you want, from wherever you want, and on your own terms.
But it’s not all about lifestyle. It can be a great move for everyone involved.
I’ve put together this Ultimate Guide to Working From Home to explore all the options you have, and what it takes to pull them off.
I’ll even show you the technology, tools, and skills you’ll need so that nobody will even realize you’ve left the building.
Part 2: The Skills To Work From Home No Matter What Field You’re In
Whether you’re a web developer or graphic designer, you’ll need to master certain skills to successfully work from home. I’ll show you how to be more productive, meet tight deadlines, and manage emails.
Part 3: How To Communicate Effectively So Nobody Will Realize You’re Gone
Communication is a must when you’re not in an office anymore. But that doesn’t mean you have to be chained to your email inbox or spend countless hours on the phone. In this part, I’ll show you how IWT works with dozens of employees in 23 states and 6 different countries.
Part 4: Make “Working From Home” One of Your Company’s Benefits
If you’re employed full-time, working from home might be more of a possibility than you think. I’ll teach you how to test the waters with your boss. And I’ll also go through 10 common work-from-home jobs and how to get the highest-paying ones.
Part 5: Starting a Business Isn’t as Complicated as It Seems
Many people start their own business with the dream of becoming their own boss and calling the shots from a home office. But they sabotage their chances of success from the start. Let me show you that starting a business isn’t as complicated as some make it out to be.
Part 6: Build a Website That Pays You in Your Sleep
Passive income — we all want it. But what does it take to pull it off? Contrary to what gurus say, there’s more to it than just slapping together an eBook and putting it up for sale online. In this section, I talk about 6 different business models to build a website that pays you in your sleep.
Part 7: The Next Steps To Living a Rich Life
Everything I cover in this guide just skims the surface of working from home. I have even more free material on finding coveted remote jobs, freelancing for enviable rates, and starting an online business with the skills you already have.
The Skills to Work From Home No Matter What Field You’re In
Anyone who ever tells people they work from home will often hear, “Wow! I could never do that.” And it’s true, it takes discipline to get up, log in to your computer, and work when nobody is standing over your shoulder and directing you. Distractions attempt to grab you from every direction.
The La-Z-Boy recliner you thought would be awesome to type your weekly reports from becomes a sink hole for your productivity.
And once word gets out that you’re home all the time, friends and family start to ask if you “could do them a favor in the middle of the day.”
Which is why, if you want to successfully work from home, you need to declare war on distractions.
In this section, I want to talk about the 3 skills you need to consistently produce great work no matter what industry you’re in.
Skill #1: Master Working in Short Bursts
Working from home means that nobody is looking over your shoulder anymore. You don’t have to pull up a random Excel spreadsheet whenever someone walks by to make it look like you’re working and not checking Facebook.
As long as you get your work done, you can free up time to tend to other things. Heck, my team can walk their dogs and pick their kids up from school without asking anyone for permission. Because I know they’re on top of their work.
The best way to be productive is to work in short sprints — not long, drawn-out marathon sessions.
My friend Chris Yeh is a Harvard MBA. He works a demanding full-time job, teaches at Stanford, writes for various publications, advises startups, and still manages to make time for his family.
Did you get tired just from reading that? Watch and learn how he pulls it off with the Pomodoro Technique.
Skill #2: Stick to Project Deadlines and Due Dates
According to my friend and bestselling author, Tim Ferriss:
“Most people fail at New Year’s resolutions because there is no consequence. If you don’t go to work, you’ll lose your job. But if you don’t stick to your diet, there’s no consequence — other than staying fat.”
The solution to finish everything you start? Hold yourself accountable. Tim’s favorite way of doing this is by using a website called stickK.
Once you sign up, you can make a commitment contract: “I will nail the project deadline.” Then, if you don’t, stickK will take your money and donate it to a charity you despise.
You can also invite friends or coworkers to referee your progress and make things more fun.
This is a great way to stay on track for work projects when the living room recliner is calling your name for nap time.
Skill #3: Make Small Changes for Massive Results
It’s much harder to shut down for the day when your “office” is where you live. There’s no night-time cleaning crew that comes to empty out the trash to signal that you’ve been burning the midnight oil.
You have to decide when to call it quits for the day. Because sooner or later, trying to jam in another task at the end of the day can rob you of your sanity.
Which is why it’s important to make stepping away from your desk a regular habit. Whether it’s a short walk, a trip to the gym, or taking an afternoon yoga class, exercise can help keep your mind sharp when you work from home. It also helps you strike the perfect work-life balance.
Charles Duhigg, the author of “The Power of Habit,” built a healthy eating habit while working for The New York Times. His approach was unconventional in that it started with chocolate.
Yes, you read that correctly. Chocolate triggers reward centers in your brain and makes you want to do things you normally procrastinate on.
And you can use the same exact principle to make exercise a habit. Watch the video below to see how you can put it into action as you work from home.
Email is a great tool. But it can suck up the most productive hours of your day if you’re not careful. And once you start working from home, you’ll get more and more messages since people can’t stop by your desk to ask questions.
Some of them will be urgent and important, most of them won’t be. It’s your job to make the call. Luckily, since I get thousands of emails a day — and yes, I read all of them — I can give you some advice.
How to Put Your Email on Autopilot
My goal is to not answer emails. Instead, I think of email as a tool.
This is where so many Inbox Zero people go wrong. The goal is not zero emails in your inbox — it’s actually getting the right things done.
I don’t give a damn if I end the day with zero unread emails or 350. I only care about getting the right things done.
One of the ways I do that is to stop waiting on responses, and instead systematize follow-ups so I don’t have to remember to do them.
For example, if I send an email about a project but I can’t proceed until I get a response from somebody else, I need to make sure I stay on top of it.
So I use SaneBox to automatically remind when I need to send a follow-up email.
I also use it to automatically elevate important emails to the top of my inbox. Others get de-emphasized and I can read them later.
The Exact Script to Set up a Meeting and Minimize Back-and-Forth Emails
Talking on the phone to set up meetings only takes a few seconds. But if you use that same conversation framework on email, you’ll create a long thread of messages, waste time, and be a nuisance for everyone involved.
There’s a better way.
I like to have canned scripts for the most common situations I’ll encounter. That way, I can read an email, mentally categorize it, and reach into my vault of scripts to select the best response.
Following the steps laid out in this section will make you more productive and keep your sanity in check.
How to Communicate Effectively so Nobody Realizes You’re Gone
It was only a few years ago that people would gather around a conference table with a device in the middle.
That way, an entire group of people could talk with others no matter where they were in the world.
The really fancy rooms even had monitors with video so everyone could see whoever they were calling.
The quality wasn’t always the best. Video feeds cut out. People inched closer to the phone in order to talk and they would still sound fuzzy.
Things have changed.
Now team members can communicate with each other with just a laptop from a coffee shop.
The sound and video quality are also top notch.
And many other tools have come along so you don’t even need to dial in and use video to collaborate on things anymore.
Here are some of the tools we use at IWT to run a multimillion-dollar business with dozens of employees in 23 states and 6 countries.
Zoom
A great way for everyone to have face-time together. We’ve run entire company meetings with dozens of employees, and it’s great to see everyone rather than just hearing voices and following along with presentation slides.
Go to zoom.us
A basic account is free. If you have a bigger company, it’s worth investing in one of the paid plans.
Slack
This reduces the amount of internal emails in a company. You can direct-message team members. You can also set up channels by subject matter like tech or sales.
Go to Slack.com
Channels are an easy way to organize conversations by team and projects. They ensure that only the relevant people see the message. Anyone who doesn’t need to be involved 100% of the time can drop in the channel to see the status.
This is also free to get started. Paid plans depend on the number of active users in your company.
Trello
Trello is a great tool for project management.
Go to Trello.com
Any projects in the pipeline can go in the “unassigned” column. Then a project manager could assign a team to it and move it under “assigned.”
Once the project team starts working, it’ll move to the “drafting” stage. After it’s completed, it’ll be shepherded through the remaining three steps.
Managers can view a Trello board and get status updates and due dates on things without having to hound people for them.
Basecamp
Basecamp has studied highly productive groups for 16 years and bundled the 6 core things they all do into an amazing product.
Go to Basecamp.com
They found that effective teams take a record of every meeting. So Basecamp created message boards to make it easy to follow conversation history. This is super helpful if someone needs to step in and get up to speed on things quickly.
They also found that productive teams don’t let questions linger. Their chat feature makes it easy for anyone to ask questions and get instant feedback.
And the study revealed that every great team has a leader who makes sure things are moving along. Which is why they created an automatic check-in to keep project managers up to date.
Team members don’t have to create progress reports or anything like that.
To-do lists make it clear who is responsible for what and all the deadlines.
File storage makes everything available in one place, and it can act as a backup disk.
Finally, the central schedule keeps everyone up to date on major milestones, vacation schedules, and any other upcoming events that are important to know about. All these soft skills are even more critical with remote teams. And Basecamp makes them effortless.
Headset
A headset is a must-have when dialing into Zoom. It blocks out any background noise from pets, screaming kids, or the landscapers outside. Having one will help you get through your meetings in peace.
Google Workspace
Just about everyone is familiar with Gmail, but we also use their Documents and Sheets apps. This eliminates the need for attachments. You just copy and paste a link and send it around on Slack or email, and everyone can view it without downloading anything.
Go to Google Workspace.
The best part is that everything is backed up. If a team member’s computer crashes, everything will still be saved on Google Drive. This has been a real lifesaver at times.
Make “Working From Home” One of Your Company’s Benefits
Your current job might be the best way to embark on your new work-from-home lifestyle. Even if it’s not a common practice at your company.
But you can’t just stand up on your desk one Friday afternoon and declare, “From now on, I will work from home!”
Everyone will think you’re a weirdo, and building security will usher you out of the office.
The key is this: If you’re great at what you do, you have A LOT more leverage than you think.
To put everything into perspective, you’re not just a body they hired. They had to screen hundreds of resumes, conduct 30+ phone interviews, and then invite a handful of people to meet in person.
Many people forget this.
So if your manager gives you a glowing performance review, it’s the perfect time to bring up the idea of working from home.
Don’t give any ultimatums. That can lead to confrontation, which never works out well.
Instead, offer to do it on a trial basis. You can use what I call the ARMS techniques to make it easy to get your boss’s stamp of approval.
Those four letters stand for:
Agree
Reframe
Make Your Case
Shut Up
The important thing to remember is that you’re proving the concept for now. Once your boss agrees to this small request, and it works out well, they’re more likely to agree to you working from home regularly.
If your company is set in their ways, and you’re set on working from home, don’t worry.
There are tons of jobs that you can do remotely now.
Here are some of the most common ones:
Virtual Assistant
First off, let me be clear. A virtual assistant isn’t just some peon doing menial tasks. This is a demanding job. A great assistant is one of the best tools executives and business owners can have.
If you’re highly organized, can prioritize tasks, and keep confidential information (you may have access to credit cards and other personal info), this might be a great job Later that day… 25 for you. You can make anywhere between $20K to $75K a year. It depends on the responsibilities of the role and whether you’re doing it full- or part-time.
Writer/Editor
Companies need blog posts, brochures, annual reports, sales letters, case studies, and technical papers. These things don’t write themselves. If you can churn out quality work with deadlines looming around the corner, I guarantee there’s a company out there who would love to hire you as their go-to writer.
Editors and proofreaders are also in demand. It’s difficult for writers to proofread their own work, and a great editor or proofreader can reassure companies that they’re publishing quality materials.
Salaries for these jobs range from $40K to over 6 figures, depending on your experience and specialty.
You can read the first chapter for free – just tell me where to send it:
Teacher
It used to be that teachers had to show up in a classroom to lecture in front of a room full of students. That’s no longer the case. High-speed internet and webcams have given way to distance learning. Now teachers can give lessons right from the comfort of their own homes.
Universities as well as public and private schools all have roles for people to teach remotely.
The pay varies. If you’re a full-time teacher for a distance learning program, you can expect what an average teacher in a similar classroom role would make. If you’re parttime, you’ll probably get a check for the hours you’re teaching. Tutoring is another good opportunity to teach and work from home.
Tech Support
Are you the person who all your friends and family come to whenever their computer craps out on them? If so, you might find yourself at home working tech support for a company.
You could be doing anything from troubleshooting tech issues or walking people through how to install software. The average salary is $34K a year.
Customer Service
Somewhere along the line, a bunch of customers got pissed because all their calls were routed overseas. People can only speak to someone named “Mark Jackson” who talks 26 with a heavy accent so many times before they get frustrated and slam the phone on the floor.
As a result, companies are bringing customer service back home. But instead of renting expensive call centers, they’re giving people headsets and letting them work from home.
Heck, lots of customer service is done via email these days, so they might not even need headsets. Expect to make $30K as a full-time customer service rep.
Web Developer
Business owners and managers want to focus on their jobs — not deal with headaches that come with maintaining and updating their websites. Knowing about WordPress plugins, HTML, CSS, and other website tools can be your ticket to a job that pays $63K a year working from home.
Designer
Great design isn’t just a “nice thing to have” anymore. It’s a business strategy. Think about buying an Apple computer. You get a beautiful white box that makes you feel like royalty when you open it to fetch your new computer.
Companies need people who know Photoshop, Illustrator, and InDesign. These jobs typically pay $40K a year.
Sales Rep
If you’re great at sales, any company would be thrilled to have you. And since you’re making the company money, you get to call the shots. You could ask to be set up with a home office where you make all your calls and answer emails. You only travel for inperson sales calls if the job requires it.
The average salary is $55K. But for people who are really good, the sky’s the limit. Commissions and bonuses can add up. It’s not uncommon for top sales reps to be the highest paid people in a company earning multiple 6-figure paychecks. They can even make more than the CEO.
Marketing Specialist
Marketing taught in schools is all about branding, market research, and strategy. But the internet has created niche jobs that you don’t need a special degree to get. If you know SEO, PPC, affiliate, or email marketing really well, companies of all sizes need you right now.
You can make anywhere from $50K – $60K and work from home depending on your 27 experience.
Database Manager
Just a few years ago, companies used to have dark air-conditioned rooms filled with computers where they backed everything up. That’s not the case anymore. Thanks to cloud computing, you can access data from anywhere in the world now.
The boom in big data means this isn’t slowing down anytime soon. If you can run SQL queries like nobody’s business, you may be able to command a $70K job working from wherever you want.
Finding jobs like this could free up time and money. The hidden costs of office work can creep up on you. Most people don’t even realize it.
How to Land the Coveted Remote Jobs and Ask for Double the Average Salary
Do the salaries for some of the jobs I listed seem low?
Are you thinking, “No way, I would never give up my job to take that kind of pay, even if I got to work from home?”
That’s because those are average salary figures. Which implies that the candidates are average as well.
The truth is, if you’re a Top Performer, you can find the best jobs with awesome perks, and ask for MUCH more than you think possible.
Many of my students have done it.
What do they know about getting their Dream Jobs that you’re in the dark about?
Case Study: How IWT Works with Dozens of Employees in 23 States and 6 Countries
IWT started as a personal finance blog that I launched from my Stanford dorm room. Over the years, as I got more readers, I realized that living a Rich Life is about more than just money.
So I expanded into careers, freelancing, social skills, and online business.
This would’ve been impossible without hiring a team to help me. Early on, I made the decision to get the very best people I could find. I didn’t want to be limited to geography. So every position I post is open to anyone in the world.
We always get a flood of applications for any job opening. The competition is fierce. But for the people who make it through the hiring process, the work is challenging. And the perks are worth it.
That’s the benefit of being a Top Performer. YOU get to call the shots and decide how you want to live, as long as you keep producing results for the company.
As of writing this, we have dozens of employees in 23 states and 6 countries.
We have former professional athletes on the team. People who used to manage Fortune 500 companies. Marketers and copywriters who’ve worked behind the scenes on multimillion-dollar launches.
Even entrepreneurs who never have to work for anyone else again if they wanted have dropped everything they’re doing to join our team.
Had I rented office space in some New York City high rise, I would’ve never been able to attract this caliber of talent.
If you’re great at what you do, we might have a spot for you.
Click here to see IWT Careers.
Starting a Business Isn’t as Complicated as it Seems
Quiz time!
If you picked anything other than choice “E,” I’m gonna give you a shot of tough love.
None of that stuff matters! The so-called experts who talk about these tactics drive me nuts.
Starting a business isn’t complicated. Are you good at email marketing? Find a few local businesses that need it and offer it as a service.
Are you the math whiz who everyone copied their homework from in school? You can probably find parents whose kids desperately need help, and they’d be willing to pay you for it.
Do you love animals and live in a large apartment complex? I’m sure you can find people going away every weekend who are looking for someone to watch Fido.
Welcome to the world of freelancing.
Freelancing might be the best way to get started in business. Startup costs are low, and if you’re getting a steady paycheck from a full-time job, there’s hardly any risk.
Don’t be fooled by the informal nature of these gigs. These are real businesses and you’d be surprised at how much you can make from something like this — if you approach it the right way.
That’s what I want to show you in this section: How to identify your first profitable idea and get your first 3 clients to cut you a check.
So let’s dive in.
…but you don’t have to take the same path as everyone else. How would it look if you designed a Rich Life on your own terms? Take our quiz and find out:
The Simple Test to Find Your First Profitable Idea
Most people think of a business idea, then ask a few friends about it who tell them, “Yeah! That’s an awesome idea! Do it!”
So they try it for a few months… and hear nothing but crickets. I won’t let that happen to you.
The trick is this: Figure out if your idea will ever make money before you invest tons of time in it.
To do this, we’re going to use something I call the Pay Certainty Test, a technique that will let you eliminate half your ideas in less than 15 minutes.
When you apply the Pay Certainty Test, you can quickly score ideas to see if they have any possibility of being successful before you dive too deep into developing them.
Here’s how it works.
Take each of your ideas and write them on a piece of paper. Next to each idea, write down who would pay you for your service.
You should have a page that looks something like this:
Great. Now apply the Pay Certainty Test.
For each person who would potentially pay you, ask yourself:
• Are they willing and able to pay me for this service? Do they have money and do they want to spend it on my service? (The Demand Question)
• Am I willing and able to provide this service to them? Am I knowledgeable enough to provide this service? (The Supply Question)
If the prospect is willing to buy, and you can provide, you’re on the right track.
Example of the Pay Certainty Test in action:
Social media consultant for law firms
- Does a law firm partner have the ability to pay? Sure. Law firms have deep pockets.
- Does a law firm have the willingness to pay for social media? Heck no. Law firms don’t care about social media. They recruit and market through other means.
The verdict: Eliminate the idea.
Motivational consultant for 20-somethings looking for career change
- Do they have the ability to pay? No. Most 20-somethings barely have enough to scrape by, let alone hire a motivational consultant. •
- Willingness to pay? No. Even if they have the money, how many 20-somethings ever talk about hiring a motivational consultant? Not many.
The verdict: Eliminate the idea.
Music instructor for ambitious children where the parents are paying
- Ability to pay? Yes, parents of ambitious children tend to have money.
- Willingness to pay? Yes, parents will spend a small fortune to make sure their kids are successful and well-rounded.
The verdict: Great idea! Pursue it!
The Pay Certainty Test lets you rapidly eliminate bad ideas that would have never earned you a cent and focus on the most promising ones.
Find 3 paying clients
Most advice on finding your first client is awful. It looks something like this:
In other words, “do awesome stuff and let people come.” Sure, this can work for some people. But in my experience, it’s neither reliable nor particularly effective compared to your other options.
Instead, I recommend being as direct as possible. Especially if you’re just starting out. That means finding prospects and pitching them with the intent to sell.
Where can you find prospects? It depends on your target audience, but you can find almost any type of person or business that you’re looking for online:
- Yelp if you’re going after local businesses
- TechCrunch or AngelList for startups
- Google for just about everything else
Make a short list of prospects and email them with your offer. You’re not asking them to buy — just if they’d be interested in hearing more (over the phone, in a meeting, etc.).
Remember, your goal is to reduce risk. I get email pitches from people all the time offering to work for me, and they’re almost universally bad, precisely because they don’t do anything to reduce my risk. Mainly the risk that reading their email will be a waste of time.
Here are just some of the thoughts that run through my head when I receive an email from a stranger:
- Who the heck is this and why should I care?
- Is this person smart or dumb? (This is why your writing should be clear and concise)
- Most importantly, what’s in it for me?
The beauty in the direct model is in its simplicity.
For example, if you email 20 prospects and none of them get back to you, you know the solution isn’t more blog widgets or a nicer-looking logo.
It’s that you need to experiment with changing either your service, your target market, or your email copy to improve what isn’t working.
On the other hand, if 5 out of 20 prospects respond positively, you’re probably on the right track.
Follow up with them, pitch them your offer in person or on the phone, and get them to start paying you! Your goal from all of this is to find your first 3 paying clients.
Anyone can land a single client. You get lucky, or your friend knows someone who hires you.
But if you can land 3 paying clients, that’s when you know you’re on to something.
Don’t worry about what to charge at this point. Even if you get $50 bucks for a full day of work, that’s not a problem.
You can always adjust the price later so that you’re making $50, $100, or even $200 an hour.
Many of my students did just that.
SUCCESS STORY
Meet Julia: The caricature artist who went from “no idea” to earning $125/hour
Julia didn’t consider herself an “entrepreneur.”
At 24 years old, she had been working at a non-profit for the last 8 years. “I liked it. Great company. The work was good fulfilling. I had great bosses. They were very flexible with my school schedule. I really had a good gig.”
Julia was putting herself through school to become an accountant, but when she decided to transfer to another college in a new city, she had a problem.
She couldn’t take the job with her and worried about going broke…
Discover how Julia found her $250/hour idea.
Most people don’t believe they have skills they can charge money for. Then I tell them how in college I used to show Silicon Valley venture capital firms how people were using social media and got paid for it. That’s something anyone can do.
Build a Website That Pays You in Your Sleep
An online business that earns passive income is the holy grail among people who follow lifestyle bloggers. It’s when you build a website, do some work once, and then relax on the beach while money floods into your PayPal account.
As someone who has built passive income through multiple online business models, I can give you the pros and cons of each.
Some give you huge profit margins, take minimal time, and scale easily. Others require a lot of time, overhead costs, and are difficult to grow.
I’ve tested 6 different models, so let’s walk through them real quick. Then you can decide what you want to take on.
Business Model #1 - Advertising
Most popular big-name websites make money through ads. You’ve definitely seen them. They’re little advertisements — usually Google AdSense — on the sidebars of a website.
Here’s how they work: As you get traffic, some people will click those ads. When they do, you get a few cents, or even a few dollars per click.
I tried this for iwillteachyoutoberich.com. But I quickly realized ads don’t make that much money. In fact, what I learned was that you need 50 million visitors — or more — per month to make a good income from ads. That’s a lot of traffic.
Back when I started in 2004, I decided, “If I can’t cover my rent with ads, why bother?” They’re ugly and distracting. Plus, I’ll end up spending more time optimizing the click-through rate on the ads than actually writing great content. So after trying that experiment for a little while, I checked the box and said I’m not interested in that business model.
Business Model #2 – Software
If you have the skills to create new software, this can be a tempting option. The media loves to tell us stories about hot new Silicon Valley startups and the founders of tech companies who cashed out for millions after their company went public.
So we think starting an online business means you quit your job, seek venture funding, and spend the next few years trying to build the next Instagram.
But let’s face it, even venture capital firms know that most of the companies in their portfolios will go belly up.
I tried dabbling in software for online business with IWT, but the constant development resources needed to stay afloat were too much. I’d rather have my team working on other things like creating great products for you guys.
Although I’m not opposed to trying software again in the future, we killed it for now.
Business Model #3 – Sell Physical Products
I’m wary of this business model because the profit margins can be terrifyingly low.
I know there’s some money to be made in this space. But I prefer fat, juicy profit margins. That puts cash in the bank that you can use to invest in your business, hire help, and much more.
Just to give you an example, we have a notepad that our designers created internally for IWT staff. We would have had to price it at around $50 — for a teeny little notepad — just to break even if we wanted to sell it. And after we shipped it to people, our profits would’ve been decimated.
Physical products just introduce production costs, fulfillment, and inventory issues. I’m not interested in any of that.
Business Model #4 – Affiliates
Here’s an example of how affiliates work: A blogger will write a review of “My favorite credit cards.” And at the bottom they’ll say, “You can sign up for the card here — NOTE: This is an affiliate link.”
If you click that link and sign up, the credit card company is going to pay that blogger an affiliate commission. Sometimes it’ll be $50 or $75.
Over time, that can actually add up to a lot of money. And there are affiliate programs for everything — from audio books to weight-loss products.
For a long time, I avoided affiliates because I didn’t want people to think I was recommending stuff just to make money. I only wanted to recommend the best products.
But eventually I realized that my readers trusted me, and they were already going to sign up for the accounts I was recommending anyway. So I decided to try putting an affiliate link in with one of my recommendations.
When I did — virtually overnight — I became ING Direct’s number one affiliate in the world. I was making more than $10,000 a month — just by putting a link on my site.
But I soon learned this wasn’t a great long-term plan. My click-through rates tailed off and I ended up having to spend all this time dealing with advertisers.
In the end, I realized it wasn’t worth the time, so I stopped.
Business Model #5 - Coaching
This comes as a surprise to a lot of my students. They’re looking to create an online information product. But as they build their email list, people message them saying: “Hey, I love what you do. Do you offer coaching?”
There are a few great reasons to take people up on this offer:
- You can charge premium prices for one-on-one work
- You’re basically getting paid to do customer research. With coaching, you’ll learn their deep fears, desires, and barriers — information you can use to create an online product that thousands can use
- It’s a chance to get great testimonials to sell more coaching/other courses
- You don’t have to build anything or have a big audience to get started with coaching. And you can earn money quickly
Business Model #6 – Online Information Products
Now, my favorite business model: Selling something you create. Typically, these are information products, like a video course or eBook.
You can create one that sells for $49 fairly quickly. But more expensive, high-end courses take a lot longer. For example, when we built Dream Job, we spent months on research, outlines, testing, creation, and design.
You can use them to reach thousands of people all over the world. It’s become the crux of our business and now we generate over 95% of our revenue through our own products. I can’t recommend it enough.
Many of my students have been very successful with this model.
SUCCESS STORY
Meet Bushra: The busy mother of 2 who earned $130,000 from an online business
Although Bushra was earning 6 figures as a business consultant, the busy mother of two wanted more freedom and flexibility in her life. She knew an online business could help, but she didn’t want to ruin her reputation with a “spammy online business.”
When I started my online business, I had to learn through trial and error. This cost me years of time and money, as well as headaches and frustration.
At the time, I would have killed for someone to give me a blueprint. Any sort of map I could follow to make sure I was on the right track.
This is the blueprint I’d follow if I had to do it all over again.
The Next Steps to Living a Rich Life
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