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Clueless Imbecile

Ways to earn extra money

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Hi All.

I work full-time as a software developer. I earn what many would consider a good salary (although I'm still a lower-rate tax payer). I even live cheaply at my parents house. I'm saving a decent amount each year, but since I don't own a house I feel constant anxiety about being left behind by house price inflation. I originally thought I would retire at 60, but after the way things have been over the last 18 years that idea has gone out of the window. I just feel like I'm not gaining wealth at a fast enough rate.

The low interest rates on savings accounts don't help. I do invest in the stock market but I think even that has probably only made me about 5.5 percent average annual return, and I worry about the potential for a stock market crash since the bull market has been going on for quite a while now.

I am therefore trying to think about how I could increase my income, which gave me the idea to start this thread.

I thought we could make a list of ideas of ways to make money. I'll start the thread off with an idea that occurred to me recently...

1) Playing poker online.

I've no idea whether or not it is possible (or likely) to make money playing online poker. I guess there is also the risk of losing money. I have heard of people claiming to make money from it. Does anyone have any experience of this?


Cheers,
Clueless Imbecile

Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.

 

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18 minutes ago, Clueless Imbecile said:

Hi All.

I work full-time as a software developer. I earn what many would consider a good salary (although I'm still a lower-rate tax payer). I even live cheaply at my parents house. I'm saving a decent amount each year, but since I don't own a house I feel constant anxiety about being left behind by house price inflation. I originally thought I would retire at 60, but after the way things have been over the last 18 years that idea has gone out of the window. I just feel like I'm not gaining wealth at a fast enough rate.

The low interest rates on savings accounts don't help. I do invest in the stock market but I think even that has probably only made me about 5.5 percent average annual return, and I worry about the potential for a stock market crash since the bull market has been going on for quite a while now.

I am therefore trying to think about how I could increase my income, which gave me the idea to start this thread.

I thought we could make a list of ideas of ways to make money. I'll start the thread off with an idea that occurred to me recently...

1) Playing poker online.

I've no idea whether or not it is possible (or likely) to make money playing online poker. I guess there is also the risk of losing money. I have heard of people claiming to make money from it. Does anyone have any experience of this?


Cheers,
Clueless Imbecile

Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.

 

You're  a coder just go contracting.

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What do you mean "only" 5.5%?  That's great, people in cash deposits have been losing money to inflation on sub 1% returns for a decade.

Tip one:  look at how much income tax you are going to pay this year.

Now wouldn't it be nice to have all of that tax back and invested tax free?

 

For convenience here is what I have posted on this elsewhere:

 

Deposit money in a SIPP: this repays at the highest rate of your tax but contributions are capped at £40k per year (used to be in the £100ks) so if you have a defined contribution take that off the £40k and if a defined benefit take 12x to 15x the benefit you have earned (the rules are complex, I take 15x to be safe).

You deposit 80% and then 20% is deposited by HMRC three months later; recover anything over 20% through your tax return.

 

VCTs: these repay tax at 30% of the contribution (rather than matching to the gross income as the SIPP does) to the extent you've paid that tax and the tax is recovered through your tax return.

All VCT dividends on shares bought through this method are tax free and are usually excellent - 8% to 10% - but as this is being paid out of investment realisations they are less likely to keep growing than a lower-yielding normal share.

You can sell them after five years without having to repay any tax.  The annual investment limit is massive; something like £0.5m.

 

SIPPs have the disadvantages of not being accessible until you're 55 (so I don't think I'd do them if I was in my twenties) and being taxable as normal income when withdrawn.

As to this latter point when I start drawing on my SIPP I will hugely overdraw each year, offset the tax with VCT contributions, and deposit the remaining cash into an ISA.  The aim being to turn the SIPP into an ISA as quickly as possible as there is no tax on taking money out of the ISA.

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Posted (edited)

Poker's too risky.  By all means start playing with bits of cash you can afford to lose if you'll think you'll have fun.  Thinking of it as a way to get richer .... there are better ways.

 


 

Edited by Napoleon Dynamite

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Mate of a mate 'claims' to have made £750k via online poker using a method his Cambridge Maths graduate friend devised for him, with which he bought a £75k Porsche with.

Sounds like BS to me...he does have the Porsche though...i figure he got an inheritance and wanted to sound cool so said he's a gambling strategy he's discovered rather than 'aunts London flat sold for a few million'

 

Sadly, the only "easy" money schemes I hear of are property related...ie people renting out driveways near commuter stations, sparerooms as airbnb. 

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Thanks for the replies.

Contracting - Tried it in the late 90's. Got 2 and a half years on a decent rate. Then the dot com bubble burst and I was out of work for 2 and a half years. I still occasionally think about contracting again, but I think you have to be willing to travel almost anywhere in the country (which I'm not willing to) and there is too much risk of being out of work. Also, I've heard that rates haven't really changed since the year 2000. Then there is IR35 and the dividend tax. It only really pays if you can keep in work for say, 47 weeks per year on a decent rate. Too much hassle & risk for not enough extra money in my opinion. The minute I have to work away from home my living costs would go up significantly, eating into any extra money I might make.

Pensions - For a lower rate taxpayer like me it is debatable whether pensions are any better than ISAs. Remember, pensions may have tax relief on the way in (contributions), but the pension income is taxed on the way out (drawing the pension income in retirement). Plus I'm 20 years from retirment. That's a lot of time for the government to change the rules in a way that might disadvantage me. I'm sure I read only the other day that the lifetime allowance and annual allowance have been reduced something like 6 times in the last 8 years?

This thread is really intended to be about how to make extra money in evenings/weekends, rather than investment options (which are probably best covered in a separate thread).

I'm in the north west.

Cheers,
Clueless Imbecile

Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.

 

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As FH says definitely maximize tax efficiency of what you already do with SIPP contributions and so forth. And contracting rather than employed should increase your income.  If your living costs are cheap as you say with no mortgage to pay then any voids between contracts won't be too big an issue for you?

There is however uncertainty to bear in mind with IR35 at the moment which has been a concern for me the last few years.

How old are you and do you enjoy software development or are you looking to make money from something completely different? 

On DB's deflation thread (around about page 120 or so) there was some discussion about private enterprise/business ideas and somebody said this absolute gem... "find out what you enjoy doing and are good at and the business will identify itself"

So do you have any hobbies or interests that could make extra income for you? Could you combine those with the software development. E.g say you like photography could you write an app that helped people take good photos.. work out all the exposure, aperture settings etc and sell that?

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Start frequenting bars at the weekend and find a lady with assets that equal or surpass your own. You will share the load on costs and potentially double or more your income. Might sound shill but it is a strategy of sorts. Plenty of women play it.

 

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Just to be clear...

I'm already doing the FIRE thing (reduced my outgoings as much as I reasonably can, investing in low-cost stockmarket index-tracker funds with dividends reinvested). Seems like the guys who achieve FIRE are generally earning six figure salaries over a period of ten years or more. I'm only on a low five figure salary, which means the "retire early" part doesn't really work for me.

The idea of the thread is how to earn "extra" money, not change careers or go contracting (already tried that - see above).

Another idea I had was:

2) advertise a "PC doctor" type service going around the local area helping people with PC/Windows type problems.

That would be suited to my IT skills. However, I don't really want to become known in the area for doing that sort of thing. I'm quite a private person and don't want to pestered about IT stuff when I go down the pub!

Cheers,
Clueless Imbecile

Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.

 

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12 minutes ago, Clueless Imbecile said:

.

Pensions - For a lower rate taxpayer like me it is debatable whether pensions are any better than ISAs. Remember, pensions may have tax relief on the way in (contributions), but the pension income is taxed on the way out (drawing the pension income in retirement). Plus I'm 20 years from retirment. That's a lot of time for the government to change the rules in a way that might disadvantage me. I'm sure I read only the other day that the lifetime allowance and annual allowance have been reduced something like 6 times in the last 8 years?

 

 

As per my post it doesn't have to be.  Though I accept the rules can change and that is a risk.

E.g. Year 1 retirement: draw £50k out of your SIPP.  Tax liability of £10k (round numbers).

Pay £33k into a VCT and that offsets that tax (reclaim through tax return).

Leaves you with £17k cash in hand (£7k net plus £10k recovered through your tax return come May) and £33k in a VCT which will pay tax free dividends and can be sold in five years and only then do you put the money into an ISA.

If you can build up sufficient cash (and living with your parents you should be able to do this) then you really don't have to pay any more tax again ever.

As I said on another thread it is like being paid forty years of salary for working thirty and that's before you get into the tax free dividends building up a big tax free income stream.

Plus you have the moral high ground from not funding the government's waste.

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14 minutes ago, Clueless Imbecile said:

Just to be clear...

I'm already doing the FIRE thing (reduced my outgoings as much as I reasonably can, investing in low-cost stockmarket index-tracker funds with dividends reinvested). Seems like the guys who achieve FIRE are generally earning six figure salaries over a period of ten years or more. I'm only on a low five figure salary, which means the "retire early" part doesn't really work for me.

The idea of the thread is how to earn "extra" money, not change careers or go contracting (already tried that - see above).

Another idea I had was:

2) advertise a "PC doctor" type service going around the local area helping people with PC/Windows type problems.

That would be suited to my IT skills. However, I don't really want to become known in the area for doing that sort of thing. I'm quite a private person and don't want to pestered about IT stuff when I go down the pub!

Cheers,
Clueless Imbecile

Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.

 

No, daft idea.

Youll spend hours gof pennues.

Theres no economies of scale in fixing windows installs. Such an infinite fuckup and time sync.

How about reducing your expevtation of what you need to retire on?

A pound not spent is a pound saved.

Try finding a niche. Im looking at various options just to earn 500/m without leaving home or doing a great deal.

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I think you are right about the ISA to pension comparison. I will only invest in ISAs for exactly that reason. That goes for myself and wife but also for the investments I am making for my kids. 

I think considering only index tracking funds may be limiting your returns. I am only in funds but spreading more widely and both Japan and USA have brought big returns so I am consistently at around 13% (15% for last 12 months). This is all within ISAs.

You may have to give up your anonymity to bring in extra work. My own business could do with the website sorting and I am sure there are many others in the same situation but they will only find you through publicity. Not sure how high the reward for you would be for that or PC doctor type stuff.

I am fortunate to have a reasonable pension starting when I am 60 and another again when the wife turns 60 which is 6 years later. Recent inheritances and having nearly paid off our business property (hotel) mortgage further boost our prospects. If investments continue the way they have so far though by 2021, when my pension begins, the investments will be returning more than the pension and business together. So the investments are the big hope.

Both pensions also bring a lump sum when they start (53k and 33k respectively) so at the moment we are in a good position.

I hope you find a way to secure your future. How far are you from retirement?

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I wouldn't get too down about not owning a house. It's not the key factor in having a succesful life or being a decent human being.

As others have said I don't think poker is the way to go...

How about a job as rent boy/ escort/ lapdancer/ contract killer? Or maybe even join one of the reserve military units? What are your hobbies? You might be able to turn a hobby into a part time job.

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Posted (edited)

If you work in London (or other big city) and have reasonable flexibility when you take your  lunch breaks sign up to do Market research panels. I get between 50 and 100 quid a month (for 1-2 lunch times) in time that would otherwise be used listening to my colleagues talking about some tosh or reading  the internet. 

Edited by Kurt Barlow

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Generally, if loads of other people also think of something as 'an easyish way to make money' then it'll never ever be an easy way to make money. 

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Posted (edited)
1 hour ago, Clueless Imbecile said:

2) advertise a "PC doctor" type service going around the local area helping people with PC/Windows type problems.

Outside of corporate application development anything IT related is actually very competitive and hard to make money from and that includes PC repair and small business web development. My opinion is that your best bet is to try to find a way to make more money from your main job. Will be  interesting to see what else comes up on this thread though.

Edited by goldbug9999

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1 hour ago, Clueless Imbecile said:

Thanks for the replies.

Contracting - Tried it in the late 90's. Got 2 and a half years on a decent rate. Then the dot com bubble burst and I was out of work for 2 and a half years. I still occasionally think about contracting again, but I think you have to be willing to travel almost anywhere in the country (which I'm not willing to) and there is too much risk of being out of work. Also, I've heard that rates haven't really changed since the year 2000. Then there is IR35 and the dividend tax. It only really pays if you can keep in work for say, 47 weeks per year on a decent rate. Too much hassle & risk for not enough extra money in my opinion. The minute I have to work away from home my living costs would go up significantly, eating into any extra money I might make.

Pensions - For a lower rate taxpayer like me it is debatable whether pensions are any better than ISAs. Remember, pensions may have tax relief on the way in (contributions), but the pension income is taxed on the way out (drawing the pension income in retirement). Plus I'm 20 years from retirment. That's a lot of time for the government to change the rules in a way that might disadvantage me. I'm sure I read only the other day that the lifetime allowance and annual allowance have been reduced something like 6 times in the last 8 years?

This thread is really intended to be about how to make extra money in evenings/weekends, rather than investment options (which are probably best covered in a separate thread).

I'm in the north west.

Cheers,
Clueless Imbecile

Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.

 

Coders still get £400 - £600 a day.  yes you may have to travel but for those rates I would pitch my tent in hell.

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Lower tax rate payer here. SIPPs still offer 25%. My plan is to get my SIPP to a level where I won't be going over the annual taxable allowance after taking 25% tax free. So I won't be loading up my sipp too much but still worth benefiting from some tax relief.

If you want some quick earners (not to everyones tastes):

Ratesetter - £100 or £250 if two of you. ten mins work

AA Savings - Topcashback, £15. ten mins work. again if two of you double

If anyone has any other beer money tips fire away

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1 minute ago, goldbug9999 said:

Outside of corporate application development anything IT related is actually very competitive and hard to make money from and that includes PC repair and small business web development. My opinion is that your best bet is to try to find a way to make more money from your main job. Will be  interesting to see what else comes up though.

Im aiming at scaling a subs type application - £10 month - for a market of several 100..

Theres got to be holes in areas - i see huge holes in medicine gps.

I reckon £10 subs, running stuff vua a web browser is the way to go.

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Posted (edited)
1 hour ago, Clueless Imbecile said:

Just to be clear...

I'm already doing the FIRE thing (reduced my outgoings as much as I reasonably can, investing in low-cost stockmarket index-tracker funds with dividends reinvested). Seems like the guys who achieve FIRE are generally earning six figure salaries over a period of ten years or more. I'm only on a low five figure salary, which means the "retire early" part doesn't really work for me.

The idea of the thread is how to earn "extra" money, not change careers or go contracting (already tried that - see above).

Another idea I had was:

2) advertise a "PC doctor" type service going around the local area helping people with PC/Windows type problems.

That would be suited to my IT skills. However, I don't really want to become known in the area for doing that sort of thing. I'm quite a private person and don't want to pestered about IT stuff when I go down the pub!

Cheers,
Clueless Imbecile

Disclaimer: I am not an expert. Anything I post here is just my opinions, which may not be factually correct. My posts are intended purely for the purpose of debate and are not to be taken as advice. If you act on any of the above then you do so entirely at your own risk. I do not accept any liability.

 

Don't do this. There's a reason hardly anyone does it. You'll just get fucked around by members of the public no end. It'll be tons of hassle for peanuts.

If you're spunking most your earnings renting look at alternatives. Also here's a good FIRE calculator http://networthify.com/calculator/earlyretirement

How about building a SaaS product using your dev skills? Or maybe e-commerce? 

Edited by gibbon

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Posted (edited)
1 hour ago, BadAlchemy said:

On DB's deflation thread (around about page 120 or so) there was some discussion about private enterprise/business ideas and somebody said this absolute gem... "find out what you enjoy doing and are good at and the business will identify itself"

Let me counter this by stating work and pleasure are best kept separate. If you do your hobby for a job, you'll no longer have a hobby, and you risk not enjoying your job.

BTW, good thread idea, OP. I've been contemplating along similar lines. You won't get rich digging someone else's ditch, someone once said to me.

 

p.s. have you though about using your talent for art? 

image.png.a4e61d17c1cc625e3d3fc1a5f0bf6222.png

Edited by Bod

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I know nothing about writing software, so may be talking out of my arse.

But I would hang around the shopify / wix / whatever forums looking at what plug ins people are asking for.

For example there was a demand for a 'donation' app on shopify. Probably not that hard to write but if you can get a few hundred customers paying $10 per month you have a good thing going.

You don't make money being paid by the hour. You need something different.

 

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