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 How To Turn a Hobby Into An Income - USAA Member Community

 

Could I get paid for what I like to do for fun? We have all dreamed about this, the prospect to be able to do something that we enjoy in our off-hours and then turn this into a second (or third) income stream. That sounds amazing! It does sound amazing, but before you create the website and rush to buy materials, there are some considerations to make sure this is as good of an idea as it sounds.

 

Hobby to Income Consideration #1 – Why Do I Do My Hobby? We all do our hobbies for different reasons, for example: personal passion to play the guitar, continuing on a family tradition of woodworking, or teaching our children how to make a quilt. The key to understanding why you do your hobby is vital because trying to use your hobby as an income stream could destroy the reason and the value you get from the hobby in the first place. Also, if you do your hobby as a way to personally get away and recharge, then adding more people such as business partners and customers might not be a great idea. If you love to create and show people what you created and challenge yourself to make even better items, then your hobby deserves consideration as an income stream.

 

Hobby to Income Consideration #2 – Is There a Market For My Hobby? The first way to see if your hobby could become an income is look for several markets to see where you could sell your talents or the products you create. A potential problem is to use your passion for your hobby as your belief in the strength of a potential market to sell your products and talents. Look around your local community for examples of how similar items are being sold and look on the internet at reputable craft distributors. This should quickly tell you if you can or cannot sell the talents from your hobby to others. Also, look for how items are advertised and how you found them because this will help you determine who your potential customers could be. If you can’t find a market, no matter, because your hobby already re-charges you and helps give you a strong sense of purpose. 

 

Hobby to Income Consideration #3 – Do a Test for 6 Months with No Investment. When we first start to sell the items we create, it is easy to think that I need to invest $10,000 so I can make this happen. Instead, start with the premise that I will make no additional investment and still sell my items. For a small independent “hobby entrepreneur” this is by far the best decision. You will learn so much in the first six months of what the market actually is, how much I can price my items to my customers, and discover who your customers truly are. Finally, very, very few hobby-entrepreneurs succeed in their first attempts. By starting with no investment, focusing on customers, and getting active in the market you learn how to sell your crafts and services without the risk of additional investment. Most importantly, the stringent cost controls force you to become extraordinarily creative with your existing resource which is always a good thing.

 

Hobby to Income Consideration #4 – Have Strict Time & Cost Guidelines. For the vast majority, a hobby-entrepreneur will have another job, family obligations, and other financial obligations. Make a strict rule, that you will keep your hobby-entrepreneur passion separate from your job, that you will maintain your family obligations, and that your sales, not your passion for your hobby, will guide your investment decisions. It is so easy when we experience success with a personal passion, the energy and excitement can over take us. Strict time and cost controls helps act as a balancing force so your passions do not overcome your obligations. This will also help you keep a balance so you do not over obligate yourself to your customers and not meet their expectations.     

 

Hobby to Income Consideration #5 – Do A Reassessment – Is My Hobby Still Enjoyable for Me? At the end of six months, you have to place a chair in front of a mirror, sit down, and look at yourself and ask, “Is this worth it?” If you have lost the passion for your hobby, if the obligations to meet customer expectations are too much, and you are taking too much time away from family, then it is easy to go back to what you had – the personal passion for your hobby. You should do this reassessment several times a year because if your hobby becomes another job or another obligation that we dread, then we have damaged something that is important to our character. 

 

Becoming a hobby entrepreneur is a lot of hard work, but it can be a great outlet for your passions. Don’t forget that by becoming an entrepreneur, you create another set of obligations with additional taxes, business records, insurance requirements, customers to support, potential government licensing requirements, high quality items to be produced, and deadlines to be met for your customers. If, after all the additional work of running the hobby business, you still have the passion from your hobby and the hobby still recharges you, then you are well on your way to becoming a successful hobby entrepreneur.

 

Have something to add to this article? Share your advice below.

 

 

About the blogger:
Chad is the author of two books: (1) Combat Leader to Corporate Leader and (2) Battlefield to Business Success.  Chad’s brand message is that organizations & individuals need to translate and apply military skills to business because they immediately produce results and are cost effective. Chad is a retired US Army Special Forces Lieutenant Colonel with 20+ years of Active and Reserve service in infantry, Special Forces, and joint headquarters units. He served in Iraq, Bosnia, Korea, and throughout the United States. He was awarded the Bronze Star, the Combat Infantryman Badge, the Meritorious Service Medal, the Special Forces Tab, and the Ranger Tab. Chad is an adjunct Lecturer of Marketing at Creighton University in Omaha, NE. In addition to teaching, he is a mid-level marketing executive and has worked in marketing and sales roles for various companies, including General Electric, Comcast, and Manugistics. He has been published in over 110 different articles in over 85 separate publications including The Harvard Business Review blog, Business Week Online, Forbes, Christian Science Monitor, and USA Today. He has a BA from Northwestern University and an MBA from Georgetown University.

 

 


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