Obviously there are unlimited ways to make $ 1000 per month. The way I’m talking about involves a new way of “trading” stocks. I’m not a financial advisor and I’m still learning this, which means I don’t have all the answers, but I’m liking what I’m seeing so far.
Imagine if you didn’t actually trade stocks, but just bought. There’s a meme in the cryptocurrency world of “hodl”, which was a misspelling of “hold”, as in – ‘I’m holding my crypto no matter what and never selling!’. So what if we took that approach with stocks (and not boring index funds)? I think there are at least a few ramifications:
“Trading” just means buying more stocks
We’d be far more choosy about which stocks we bought since we couldn’t sell
You’d be completely at the mercy of the market
But what if that didn’t matter? As long as the stock doesn’t go to zero it may still be useful, and if we buy the right stocks – we can expect to hold them for 10, 15, 20, 30 years or longer, as long as the company remains viable.
Since we’re holding these stocks “forever”, we open up options. Not just the ability to buy or sell options but we open up different avenues for making money with our stocks.
For example, in the current year with apps like Robinhood and Webull you can do a few things to earn more money on your stocks, like loaning out your shares for a fee. Or you could go to a traditional bank and use your stocks as collateral for a loan. Many banks will loan you 50% of the value of your stocks, so if you have $20,000 you can get a loan for as much as $10,000. If your stock pays a dividend you can receive a monthly or quarterly return of some money, which can then be reinvested back into the shares themselves.
But I’m not talking about lending shares or getting a loan or buying dividend stocks and collecting passive income – unless you’re already rich those won’t amount to anything meaningful and you’re trying to make $ 1000 per month!
I’m talking about a system of selling options on your existing stocks that can safely and reliably make you 2, 5, or 10% returns on your portfolio each and every month.
You’re probably yelling – “Enough already – how does it work?!”
Instead of buying risky and volatile options like novice traders, you can sell those same options to the people taking major risks! And what’s better yet, in order to guarantee these options, you actually need to own the stock or have cash to cover the cost of the stock – which means unlike normal options traders who buy options and lose everything, you are protected from major risk.
Selling Covered Calls to Make $ 1000 Per Month
There are actually two different ways to use this strategy: Selling “Covered Calls” and selling “Cash-Secured Puts”.
Selling a covered call means you own 100 shares of a stock and are selling someone the right to buy those shares away from you at a specific price at a specific time. So let’s say you own 100 shares of ACME Corp stock, worth $10 each. You can sell someone the right to buy those shares from you for, say, $20 each,1 month from today. If the share price goes up to $21 or more in the next month, that person would probably exercise their right to buy those shares from you. But if the price doesn’t go above $20 they probably won’t exercise their right to buy since they could just buy them cheaper on the market, so the option expires worthless.
The magic here is that in either scenario above, you still get to keep the money you got selling the option, AND if the price of the stock doesn’t go above $20, you still have your shares! Let’s say you charged $20 for that option you sold to buy all your shares at $20. You only had $1000 worth of stock to begin, and you made $20 selling the option. That’s a 2% return (in a month!) It doesn’t sound like much. But do this every month for a year? You’d end up with a 24% return in CASH on your $1000 in stocks, AND you keep the stock!
Making $ 1000 Per Month In Real Life
It sounds too good to be true, but let me give you a real-world example.
Last month, I made $4500 just selling options on 1 of my poitions – 1200 shares of COIN, worth about $250,000-at the time. I sold 12 options contracts for $375 each (that represents a 1.8% return) at the beginning of the month. The price didn’t get above my target and so they expired worthless, and I got to keep the $4500!
But what if the stock had gone above my target price? Let’s say the calls I sold for $375 each were at a price target of $210, and the price at the end of the month was $212. The person who purchased the option would probably exercise + sell, so they would make $2 per share buying my shares + reselling them immediately. I would actually be forced to sell my 1200 shares at $210 each (meaning I technically “lost” $2/ share). With that $252,000 in cash, plus the $4500 I got from selling the option, I’d have a total of $256,500. I could then just re-buy all the shares for $254,400, keeping the $2100 left over as a profit!
So you see even if you are “forced” to sell the stock, you can just re-buy it and keep selling options against it again.
What about Cash-Secured Puts?
Selling puts works the same way, but starting with cash and if it goes “wrong” ending with you buying the stock. You are selling the right for someone to “put” their shares to you. Which is a fancy way of saying they have the right to make you buy them from them at an agreed price. So if you sell a put for 100 shares of a stock worth $10, you would need $1000 in cash to “secure” that put. If the price falls to $9, the seller has the right to make you buy at $10, netting them a $1 per share profit, or $100. But you then get the shares of stock, and can start writing covered call options against them.
So there you have it – taking money and stocks you already own and selling, not buying options, you can earn 2% or more per month without giving up the cash or stocks. If you do this with a portfolio worth not even $50,000, you can easily make $ 1000 per month selling options!
Okay so this is one of those things a lot of entrepreneurs don’t frequently talk about. When is the right time to pivot your business focus or even your entire business? What causes the need to pivot?
Too many attempts
I’ve been struggling to launch a business since 2017 – almost 5 years! I’ve written and re-written this blog and never made a penny off my content. I started an Etsy shop (well, two), a coffee company, and a host of other failed ventures. Despite making okay money off some of my businesses, not one has ever succeeded in the long term or been enough to replace my own income. My fault. The main causes my failure have been 1) I was trying to do too much 2) my effort has been spotty at best 3) I wasn’t doing anything interesting or truly valuable.
In the last iteration of this business I envisioned myself creating a course, making YouTube videos, running a store, writing in a blog, and holding down a steady job while starting a family. It hurts as I read that last line back to myself. It’s totally possible to do all that but being honest with myself there was no “there” there…I was spending an inordinate amount of time chasing pennies.
Not only that, but I started putting off doing any work at all. My joy chasing my dreams turned to dread of another afternoon spent not doing the one thing I knew I needed to be doing. Because I wasn’t interested.
Change in thinking
At the end of the day I needed to pivot my entire vision to something that would keep me occupied and engaged.
So I’ve done that again. This is my last pivot – I know what I really want to do.
I want to help people get rich. Duh – it’s in the name of the site! Even though I know being rich doesn’t solve all your problems, it makes many problems go away a lot quicker so you can focus on the important stuff.
I recently heard someone say something along the lines of “it takes almost the same amount of effort to start a business chasing a small dream as a big one, so you may as well go after the big ones”.
At the end of the day the causes for my failure I listed really roll up into the fact that I wasn’t dreaming big enough. I’m changing that right now.
In the next 10 years I’d like to help create 100 millionaires. Starting now.
So every business needs some form of capital, and a way to earn income. There’s so many different ways to achieve this, but I want to talk about my new business and the ways in which I am monetizing it creatively.
Creative monetization to me means exploring ways to earn additional revenue on top of just selling a product or service. It means going beyond just your primary income source and finding additional revenue opportunities. This can include up-selling / cross-selling, partnering with industry-adjacent companies, affiliate sales, and more. It really depends on the particulars of your business. Hence the “creative” bit…
A quick note on this before we get into monetization. The initial money for a business has to come from somewhere, usually your own savings. That’s also the case for me with this new business – I’m basically fronting the capital in hopes of bootstrapping something that makes more money.
This is how most businesses start. Some start with an initial “seed round” raise, but in most cases it’s just “some person” with a bit of money, time, and an idea.
My Income Sources
Alright time for the meat of this – how am I gonna make money with my kooky reselling business?
Obviously direct sales is the primary revenue generator, and likely will be for a good while. Because of existing competition I’ll be boosting revenue from a few sources.
Paid membership to a site, store, or service has been a culturally accepted way to do business for a while now. Costco and BJ’s wholesalers are a prime retail example, while the various “box-o-stuff” companies offer an insight into the online way to do it. Do I even need to say SAAS? That whole model is recurring subscription revenue.
As I mentioned in my previous post, I will be making use of Patreon to manage these subscriptions for me. With Patreon, patrons can donate as little as $1 or as much as you want – you can set the tiers and rewards.
In my case, I’ll be offering Patrons discounts on the goods and services I’m selling and a few other unique perks related to my industry. This will act as a gateway to both recurring revenue and the ability to generate revenue-on-demand via sales, etc.
With a base of Patrons established, I’ll be able to take advantage of having contact information and a communication channel established to generate additional income.
Perhaps a related company is offering an affiliate opportunity that I can present to my customers (assuming it adds value to them, of course!). Or I can close out old or less valuable inventory with flash sales to lower my carrying cost and put some cash in my pocket when needed.
The point is, having an already loyal customer base can generate additional opportunities, but be careful.
You don’t want to alienate customers with over-offering or spammy sales pitches. At some point they’re going to realize you are treating them like a cash cow. If you are, not only will they never come back, but they may actively work to discredit you.
Like in the real world, at the end of the day all you have is your word. Don’t abuse it!
I also mentioned previously that I’d be creating Youtube videos as a part of this business. When you reach a certain viewership, Youtube allows you to earn around $3-5 per 1000 video views.
First, I have to even get to the point where I can offer ads. And even after that, it will likely translate to $3 or $5 per video for me to start. With enough viewership, content itself could eventually produce several hundred dollars or more daily.
Wrapping it up
So for this business, the plan is to generate revenue from:
Recurring monthly subscribers / supporters
On-demand sales, promotions, etc
Just as with your personal life, if you want to increase your chances of getting rich with a business, you need to have multiple sources of income. Hopefully this should get you thinking about creative ways to monetize your business.
It’s been too long since I posted a quick update to my business.
Sales basically fell off a cliff since the last update. It’s been over 2 weeks since my last sale, which was expected. I mostly depleted my inventory and the remaining stock hasn’t been repriced to sell.
I have avoided updating any of my inventory specifically because I’ll be creating a Shopify private store later this month as my sole storefront for sales.
But what else have I done in the meantime? Updating my company name / information. Keeping Instagram going strong with daily posts and growing a community / following of over 100 people in less than 3 weeks. Creating additional content to post to my YouTube channel.
And took some time off at the end of the year to enjoy family!
So what’s in store for the next little bit? I mentioned previously, setting up my storefront. I’ll also be crafting some ads and running tests with those this month, to generate sales and patrons. Later this month is a new product release that will likely drive patronage and more.
Okay, let me take you back a few days. I thought it would be great I stole the idea to do a “12 Days of Christmas” themed giveaway on Instagram for my business. Remember my thoughts on doing original things.
Actually, I’m still in the process of giving away this stuff. How, you may ask?
For those wondering, I deactivated my Facebook for close to 2 years ago now and have never used Instagram or Twitter in any meaningful way until only a few days ago. I am in no way an expert on this stuff.
That said, I was given a couple of awesome pointers at the outset and now have a few great insights of my own to share that I think can help get people start to quickly build a community on Instagram.
Before you start using Instagram – a few pointers I got
So this first one is actually from me – this is another project or activity you are committing to. Hopefully it will increase your reach and visibility, and improve your community.
But social media is not something that should be approached any less seriously than any other part of your business. Make sure you have the attention to respond to people throughout the day if you decide to use Instagram, or other social platforms.
1. There are 2 types of people…those who read…
A large portion of your activity will be people engaging in your content by just “liking” it as they scroll through an endless sea of content. Your content will need to:
Be visually appealing
Have a clear call to action, if any
Engage / Inform quickly in your post
You can’t rely on any more than half of people to ever read your posts, and that may be incredibly generous.
Tactically, you can use the “add to story” option to create visually appealing pictures and edit existing images to add text, links, etc. Then, take a screenshot and edit to upload the image as a regular post instead of a story that will fall away in time.
I’m going to have to explore the benefits of stories more later… I’m only just posting regularly for now, since I think they disappear? Like I said I’m new!
2. Use emojis. Seriously – you feel stupid at first, and they totally work
For whatever reason, people place a TON of meaning behind emojis. It can be personal meaning unique to that individual or a shared group meaning across the world. That’s powerful – those meanings cause emotional reactions from people, and tapping into that (even accidentally) will help drive interaction and response – or engagement.
Use emojis to set the tone of your message, or just use them as a “non sequitur”. Can’t think of a good emjoi to use in 10-15 seconds, or can’t find one reasonably quickly? Just grab something random and crazy. Be tasteful, but you can learn which emojis cause different reactions over time.
3. Hashtags really matter on Instagram
A ton, in fact. Over 95% of my inbound visitors were based solely off of hashtags. For a new account, this alone should make you take notice.
If you’re looking to bootstrap a following quickly, you need to spam the bottom of your posts with hashtags. The more the better. 15….20….more – whatever you can think of. If you’re struggling with suggested hashtags, find similarly-niched accounts with better numbers and use those!!
So there you have it – the 3 secrets of Instagram from someone with 20 followers and a 4 day old account!
Visually appealing posts
Solid Emoji game
I look forward to learning more and opening up my account to some analysis in future posts!
Nothing earth-shattering in the way of updates, but definitely making strong improvements. It’s actually a solid list when I think about it… It feels as if something has changed in me. I have hit my stride in creating content across multiple platforms and running the business at the same time.
Some key developments since the last update:
Completely re-worked my Patreon offerings (a separate post about that later)
Hit a good cadence and am releasing a business video and posting here roughly every 3 days. There’s actually a bit of an industry “lull” at the moment so I’ve created a video backlog on YouTube.
Created an Instagram page for my business. I’m still learning about this, but I am convinced social media will play a big role in the advertising side of things.
My sales reporting is definitely lagging at the moment, but sales have been relatively strong still. You can see I had another high $ order come in – those are pretty great days.
I expect sales to taper off for a little more than a month as my industry has some seasonality in buying behavior. In particular the Christmas shopping season is mostly done, so the taper will be pretty big.
This leaves less time needed to ship products and more time for creating content and working on the “guts” of the business.
I have lots of content planned for this site AND the business over the coming month. It’s really “crunch time” to try to get more patrons to bootstrap my business, which means advertising.
You may have noticed that I haven’t divulged details of the business. I’m doing that mostly to separate these two parts of my life. Also, there’s already enough competition out there! Maybe in the future, but once you open Pandora’s box….
There’s a January date I’d like to hit with the business, but that hinges entirely on some critical action I need to take quickly.
First, I’m going to have to create a web store. This is relatively simple, but the maintenance of it will be potentially complex. I want to do some pretty cool and potentially challenging things, like dynamic real-time pricing and actually put the store behind a wall. That’s right – I want to STOP people who aren’t patrons from shopping at my store!
More importantly than the store, I need a distributor agreement in place. I have a great potential lead but actually making that happen is really the linchpin for success here. Honestly, I’m scared of this one. I’m scared to make an ask, scared to get rejected (because of what it may mean for the business)…
But I’m just going to have to suck it up and have that conversation.
Finally, I’m going to start my first attempt at paid advertising soon. We’ll see how that goes. I’d like to try to find out how much I need to spend to get 1 patron, and go from there. I have a feeling it’s going to hurt my wallet 🙁
Well, here we are. I’ve been bursting at the seams to introduce post about a business I started about 2 months ago.
It’s a new take on an old idea for me – reselling via eBay. But the twist is that I’m also uploading original content I create that is related to my product to YouTube in hopes of eventually monetizing my business through multiple streams of income:
Whatever else I manage to find or think of along the way
The business is going through a few growing pains I hope to iron out as I go along. It’s had slow traffic to start (no marketing) and I’ve already had to rename it, but we’re getting there.
For now, 100% of revenue comes through product sales, which will change over time. Using an established marketplace in eBay helps. As I get Patreon patrons, and unlock the ability to run YouTube ads I believe they could replace the bulk of my expected revenue.
But that’s enough intro for now, let’s talk about some strengths and weaknesses the business has…
What I like about the niche I’m in:
I am interested in it as a hobby
Large potential market
Strong future projections
What I don’t like:
Relatively crowded space
3rd party risk
I’m having to stretch myself past my comfort zones
Let’s go into those a bit more before I talk about the business itself.
What I like
Business as a Hobby
This business was ultimately borne of a problem I had with “leftovers” from a hobby I enjoy.
It allows me to spend time and attention doing what I would otherwise, and make some extra money! Not only that, but it ensures that I will continue to put in time and energy.
Most companies I’ve started that ultimately failed did so because my heart wasn’t in them. It’s one thing to have an okay or even a great idea, but you have to be in love with it if you’re going to be successful in the long term.
Having customers matters a lot in business
Ensuring there is a large available market for people to consume your product is crucial if you want to have a functioning business that does more than take away your time.
In no way does this mean it won’t be hard work even if the potential market is huge. But the goal of course is to eventually have a large enough customer base and scaled systems to be able to work less, not more!
In many cases you can make do with a handful of customers that pay top dollar for a specialized product or service. However the nature of this particular business is not aligned with that model as the typical price point is a little lower.
Looking ahead is important
Nobody knows what the future holds, but every business must be aware of both potential tragedies AND opportunities.
Assessing the prospects of your business against a 2008-style recession or a prolonged period of growth early on will help stack more odds in favor of your success down the road.
Are the customer-base and social media communities growing? Will the overall industry face challenges from globalization or artificial intelligence? There’s too much to consider, but generally you can get a sense if your chosen industry is growing or in decline.
The main idea is to avoid being a horse buggy salesman in a world of automobiles.
What I don’t like
Not a blue ocean
The industry I’ve decided to enter is not a new one, and in fact has many established companies that have been doing it for decades.
Now that doesn’t mean I can’t compete or that there isn’t money to be made, but without creativity and a lot of hard work, it’s a doomed mission.
Relying on others can be disastrous
Many businesses, even “solopreneurs” rely on others – employees, contractors, and other businesses like vendors and software providers to name a few.
However, when you resell products, the popularity of that product can sometimes change. Especially if the company backing it makes a wrong pivot or goes under entirely.
Double-especially if you are participating in a fad-driven trend (remember Beanie Babies, anyone?)
To the extent you are able, building redundancy into your business wherever possible will help mitigate this risk. If there are two suppliers for the same widget, try to start a relationship with both. Diversify your income away from single-sourced products as much as possible. Most importantly, remove yourself as a roadblock to work (if it’s not just you).
Growth is hard
To really make this new business succeed, I’m having to grow in 2 areas.
First, extroversion and community engagement are actually a large part of the unique angle to my business. But I’m skeptical of social media and am primarily an introvert.
By forcing myself to publish creative content I am putting myself out to the world in a more public way than I’ve been used to. Fortunately the relative anonymity of obscurity is working in my favor.
Additionally, there are technical aspects to running this business that I need, but lack the skills to do currently. I’ve never had to use Google Ads or other monetization platforms. I even learned how to upload videos to YouTube to kick this business off.
Not only that, but eventually I’ll be creating a “private” storefront that will use some currently-not-yet-existing technology to automatically adjust the prices of my items relative to the market in “real-time” for those with access to the store.
How is my business doing 2 months in?
So far, okay.
As you can see in the image below, my revenue has been pretty spiky, with most sales averaging around $11 an order. As you can see I had some larger sales for pricier items as well as some days with multiple orders that totaled a higher amount.
Some other notes: I’m averaging about .8 sales per day, or basically I get an order about every 4 out of 5 days. Sometimes though I can go several days without orders.
Also this is entirely via eBay, but without any marketing spend. I have not started or attempted to drive any sort of paid traffic to capture revenue. Obviously there are also additional fees and costs that are not included in these numbers (revenue, not profit).
But this isn’t the only part of my business. There’s the YouTube channel and Patreon, as well. While I will happily give a better update on these in a future post, for now, let’s keep it light.
Patreon…well…all I can say is….Thanks mom and dad! I’m still working on making a valuable offer to my patrons to entice people to support me. Hopefully will have an update on that to come.
YouTube hasn’t been MUCH better, but I have a handful of subscribers and my videos are getting some organic traffic. Realistically, most of that is probably friends and family too, but you gotta start somewhere!
One of those was not being willing to put in the effort.
And that’s what Surveys are – low effort.
I’ve often found those who struggle at making money online are the ones who aren’t willing to do what it takes, day after day, to get the results they want. They’re looking for the easiest way.
If that sounds like you, you need to cut it out now!
So how much can you make?
Realistically – only about a couple dollars an hour.
This kind of information – your opinions, your personal data, etc – is very valuable to companies in aggregate, but not very valuable to you individually.
Consider this – the average facebook user in the US is worth about 30 cents a day in terms of advertising!
This is the reason why you can only make a couple dollars an hour answering surveys. It just consumes all of your attention, and will never be profitable, except for the survey company selling your data in bulk to advertising companies!
Is it possible to build a portfolio that will build and secure your wealth while still generating sizeable returns, in any financial climate?
I think so.
I hate hate hate the “D” word – Diversification. When it comes to getting rich, I think portfolio diversification is one of the biggest lies sold to the masses. Diversification is a strategy for the already rich!
And that’s what this post is about – how to construct a portfolio that will keep your wealth secure while continuing to grow it regardless of the market conditions at the time. This is not for people looking to build wealth, as diversification actually lowers returns over time.
Everyone always picks on Jeff Bezos. Well since 2006 Amazon returned an average of 558% return each year. A lot better than a “diversified portfolio” of 500 stocks that averages 8% a year.
Cash is the backbone of any portfolio
“Cash is king” – this is investing 101. You should always carry enough cash to cover 2 things – potential opportunities to invest in and emergencies. Being stuck without cash can be a disaster. You have to use debt financing, which is expensive, and sends your net worth in the opposite direction of what you intend.
How much cash to hold is another question entirely. Some people recommend a 3-month buffer, others a 12- or 24-month “emergency fund”. As for your non-emergency cash – anywhere from 0-50% of your portfolio or more can be appropriate. For myself, I try to keep it at around 20%. This is sizeable enough to take advantage of just about any investment opportunity I may want, but also not so much that I feel like I’m barely making anything on my investments.
When I am a little light on cash, it’s time to sell some winners (or losers, if I have any) to rebalance. Otherwise, if I’m too heavy into cash, I start hunting for my next opportunity.
Stocks for appreciation and yield
Rather than owning a broad-market index, I prefer to pick and choose specific stocks of companies I believe will do well for years to come. Not only do stocks increase in value, but they can also provide 2 streams of income. More on that in another post.
Most people are afraid to pick individual stocks and “get it wrong”. This definitely happens a lot but generally owning strong companies for the long term will outperform the market. Easier said than done, but I’ve managed to do okay so far. Right now stocks make up about 50% of my portfolio.
Precious Metals provide portfolio security
Hardly anyone owns gold and silver, the two “monetary metals”. Yet they are the ultimate hedges against inflation and have been the best investments at various times throughout history. I believe this is another one of those times, and so do some of the best-educated investors of our time. Mike Maloney wrote the best “Guide to Investing in Gold and Silver“, which is actually the book that got me interested in investing and personal finance to begin with!
With gold and silver, a little bit goes a long way. You should really aim for less than 10% of your portfolio in metals, unless you are going through currency collapse and hyperinflation, at which point you should probably have it closer to 90%. In the event of a currency collapse, that 10% may turn into 90% without you having to do anything, which is exactly what gold and silver are for.
Real Estate as the biggest wealth generator
Rental income, tax benefits, price appreciation – what’s not to love? Real estate is hands-down one of two things that the ultra-successful use to get rich (the other being owning their own business). There are so many benefits to owning real estate, that while you’re trying to get rich it’s one of the most surefire ways to climb the later. But as a wealth preservation mechanism, real estate is almost without peer. Being able to generate tax-advantaged income through renting is what sets real estate apart – the yields are often far higher than with other assets.
10-20% of your money into real estate can set you up with a recurring source of revenue that nobody can take away from you!
With the advent of Cryptocurrency an entire generation of millionaires has been minted out of virtually nothing (ha!) Digital currencies and blockchain technology are among the most popularized alternative assets, but other things like mineral and oil rights are available as well.
These types of investments are generally the most volatile and risky, but can also be the most rewarding. They can add depth to your portfolio with assets that aren’t correlated like stocks, bonds, and currency tend to be. For myself, I keep between 10 and 20% of my portfolio allocated to alternative assets. Watching your money 10x in less than a year is a hell of a drug!
Putting it all together
So what does this all look like? Below is a simple example portfolio, and happens to be approximately where my money is currently invested as of the writing of this (August 2021):
So there you have it! A great portfolio allocation to keep and grow your wealth through any market conditions. Disagree? Let me know about it – I’d love to hear your thoughts!