Unsurprisingly, according to a recent survey by SunTrust Bank, 64% of millennials have or used to have a side job, adding on average $10,972 to their basic annual income. That’s actually pretty decent, but do you really want to babysit for that money or work as a personal assistant? Strangely, 29% of the millennials do! Or do you want to bust your hump baking, cooking, freelancing, or wedding photography? Also fair, at least 23% of your peers think so. Perhaps you enjoy doing arts and crafts, as do another 20%, — all good, but we want to offer you a slightly different route. Let’s talk about a few ways to make your money work for you. After all, freeing up a couple of hundred quid and playing with it might be much more fun than walking somebody else’s dog!
Trade Stocks
The question of whether or not it’s possible to make a living trading stocks has been answered many times over in film and print. However, the bigger issue is: can you do it without a fancy degree, armed only with a laptop computer and an internet connection? And as of late, the answer is, well, maybe.
The idea that you could sit at home or on the beach and support yourself just by trading stocks online is incredibly alluring, but the probability of this outcome depends on quite a few factors.
The Internet is full of paper trading simulations designed to lure novice traders into the “inevitable success” trap, but the overwhelming majority just blow their accounts up in the first few days of trading. Still, it’s entirely possible to carve your living from the market by trading stocks online – there are plenty of “apps for that,” Robinhood being the preferred choice for a reason: in 2019, the Robinhood app, with its 6-million-strong customer base, became the largest US-based online stockbroker, leaving E-TRADE far behind.
Robinhood is a mobile platform for trading stocks, ETFs, and options with zero commission, which is the reason why it’s perfect for beginners. There is no minimum deposit requirement to get started – another point in Robinhood’s favor.
The downside is that there are no tax-sheltered accounts (IRAs or other types of retirement accounts). Another drawback of Robinhood is that they don’t currently offer automated trading features. Still, you can margin-trade through the company’s premium-tier feature, Robinhood Gold.
Another reason for Robinhood’s meteoric rise in 2019 is its transparent revenue model, which generates revenue from Premium accounts, margin interest, order-flow payments, $10 fees for phone-call transactions, and assistance with purchasing foreign stock. Somewhere along those lines, there may be your way in too.
Invest in Digital Securities (Security Tokens)
Lately, the talk of the brand new asset class called “security tokens” has been getting louder. Essentially, a security token is the digital representation of your immutable ownership right to a share of an asset. Investing in security tokens gives you a huge array of opportunities to enter multiple markets for virtually any asset class. Listing all use cases for security tokens would be a futile task – the global assets market is measured in hundreds of trillions of dollars. However, given that “asset tokenization” as a mode of crowdfunding investments is less than two years old, the real success stories are few. Smartlands is a good example of how to tokenize real estate equity the right way. In late August 2019, the UK-based company closed the sale of its first offering of digital shares in a commercial real estate property located in Nottingham, UK, and has been doing triumphant media rounds ever since.
Smartlands is the very first (probably the only) FCA-regulated investment crowdfunding platform in the UK that allows the use of cryptocurrencies alongside fiat currencies to raise capital, providing a unique proprietary solution for fractional ownership in any asset class. With the lowest threshold for investment in the space – £500 (or an equivalent in any fiat currency or cryptocurrency accepted on the Platform), it’s an excellent starting point for any registered investor who wishes to start small.
The global demand from SMEs and retail investors for access to fractionalised institutional-grade investment projects is immense, and security token issuance platforms like Smartlands are happy to oblige. According to a recent study by InWara, STOs (Security Token Offerings) increased by 130% in Q1, 2019, compared to the same period last year. Markets are beginning to realize that this emerging asset class is the biggest opportunity right now, and novice investors who amass enough brainpower to get in on the action will definitely end up on the winning side.
Make a Deposit in a Digital Bank
If you don’t yet have a payment card issued by a digital bank, you should definitely get one. The reasoning is simple: branchless banks have lower overhead, hence higher deposit percentages. Your neighborhood bank will offer you next to nothing on a current account or 3% tops on savings, whereas digital banks are known for double-digit interest figures.
Earning potential aside, in the age of the Internet, digital banks are poised to take over a large share of the legacy banking business, offering their customers plenty of desirable options. They boast cool apps loaded with features such as real-time spending analysis, budgeting, tons of payment and exchange options, and much more.
There are some downsides, though. The way digital banks earn revenue is by allowing their affiliate partners to plug into their apps and use customers’ data to create a “marketplace” for services like micro-lending, investment advisory, insurance, etc., paying the banks a fee whenever an offer is taken.
However, the data show that the benefits digital banks provide to their customers far outweigh concerns about the space. Revolut, Monzo, and others are all mobile-app-based digital banks offering an unprecedented array of services to young, tech-savvy users. Think unlimited cross-border transfers, free prepaid debit cards, operations with cryptocurrencies, limited withdrawals, cashback, and plenty of other services designed for one thing only: to push legacy banking out of bounds by grabbing the customer base traditional banks have failed to entice time and again. So far, they’re doing extremely well: Revolut claims to have over three million customers, and the company is currently valued at £1.3bn, processing $3bn in transactions a month.
Trade Cryptocurrencies
We’ve touched on cryptocurrencies once or twice above, but it’s time to explore this excellent money-making tool in depth. After all, with a small amount of skill and dedication, you’re certain to pluck a few quid out of this $221bn market.
First things first. Cryptocurrency is an encrypted, decentralized digital currency that is transferred between individuals and used for instant, zero-fee payments, value storage, and investing. It’s intangible and exists only as data. While Bitcoin is not the only digital currency on the market, it is indeed the first and most popular one, dubbed “digital gold” by the industry. A large part of the value of cryptocurrency lies in the secure way to identify transactions and transfer funds using blockchain technology.
Trading cryptocurrencies is probably one of the most lucrative (certainly, the most exciting in this writer’s opinion) ways to double your lunch money in just a couple of transactions. There aren’t any minimum investment requirements or special knowledge that you’re supposed to possess before trading. Naturally, navigating your way through almost 3,000 currencies in existence today is mind-boggling, but to get started, it will be enough to learn the basics by familiarising yourself with the frontrunners.
Why do it? Here’s the short answer. The cryptocurrency market is highly volatile due to huge amounts of short-term speculative interest. The volatility of cryptocurrencies is part of what makes this market segment so lucrative. Rapid intraday price movements provide a range of opportunities to shrewd traders but also come with substantial risks. Bottom line: exploring the cryptocurrency market can be hugely profitable, but developing a risk management strategy is an absolute must.
Peer-To-Peer Lending
Starting a peer-to-peer (P2P) lending business can be highly beneficial for a beginner entrepreneur. Funding is something small business owners always seek, and alternative funding mechanisms are a very important component of the “shared economy.”
P2P lending is both a form of social lending and a mode of crowdfunding. It’s easy to set up on the go because all you need to start lending online is a web platform, through which you’ll be reviewing and automating your application submissions, screening your applicants, maintaining your social presence, and doing all the rest of the stuff the money changers of the 21st century are required to do – reporting, taxes, collections, etc.
The earning potential of a P2P lending business is tremendous, and charging interest on the principal amount is just the beginning. Application charges, fixed borrowing fees, late fees – this business is based on fees and late charges, so as long as you don’t get too greedy, in most cases your customers will do the hard part for you. Just remember the reasons people borrow money in the first place: they want something but don’t have the means to purchase it outright, which puts your customers in a high-risk category. To counter that risk, you’d need three things: a full-time IT guy to maintain your infrastructure and fend off inevitable cyberattacks, a legal representative, and a state-of-the-art screening process, which is often built into the platforms you use. And if at some point you grow frustrated with everything this tumultuous business throws at you, remember that the global P2P lending market was valued at around $17 billion in 2018 and is projected to grow at a CAGR of over 22% to surpass $52 billion by 2024.
