Side-hustles are a form of business that will never die. It is quite natural for humans to look for productive things to do in their spare time and good side-hustles should be the perfect crossover between interest and revenue. Some of the most popular side-hustles are those that promise high returns for a limited engagement, which is why they are so popular. In this article, we will walk you through 5 common side hustle scams, and provide alternatives that you can do instead.
Before we begin, it’s important to note that while we suggest avoiding these side-hustles, some people have found success using them (hence the popularity). The information in this article is based on our personal experiences and extensive research.
Multi-Level Marketing (MLM)
If you have been on social media within the last few years, you have likely come across some kind of Multi-Level marketing scheme. They are companies that utilize the networks of regular people to sell products. One of the most popular examples of MLM is Avon (though it held more legitimacy than most MLM brands found today).
These are popular because they allow entrepreneurs to make money using their own platforms during their own time. Another attractive feature of MLM is the promise of unlimited returns, MLM promoters promise that distributors can sell as much capacity as they can handle. However, MLM is usually a scheme, most notably a pyramid scheme. Pyramid schemes rely on new members to generate profits at the top. You have to keep buying in the Pyramid in order to generate revenue, making this popular side-hustle a scam.
Foreign Exchange Trading (Forex)
Over the past year, Forex trading has been widely debated. Some swear by it and others curse its existence. Let’s establish a couple of facts:
- Foreign Exchange is not new.
- The Foreign Exchange industry is legitimate.
- Most Forex groups/programs are not legitimate.
The Foreign Exchange market is a real industry that exists in almost every major bank. It is the sale and/or purchase of a given country’s currency in the hopes that by the time you sell the currency, the price has increased. If stocks allow you to ‘bet’ on a company, forex allows you to ‘bet’ on a country. The problem with the newest wave of Forex investors has less to do with the industry and more to do with the business model. Many Forex groups are modeled after the MLM schemes we mentioned above, this is why many Forex traders encourage others to join. If you are looking to get rich quick, it just doesn’t exist. No one on the Forbes Billionaire List got there through getting rich quick, and no one got there from Forex.
Cryptocurrency trading companies promise large returns for limited time/capital. As an entrepreneur, to find success you need to have an abundance of either time or capital, and sometimes both. Crypto trading can be lucrative, but the risks surrounding it may outweigh the benefits, making it a scam. Crypto traders are often quick to show profits and slow to show losses (similar to forex traders). If you are looking to passively make some extra cash with limited capital, check out this article on how to increase your income in a more legitimate way.
Don’t get me wrong, there are plenty of life coaches that are passionate about their trade and qualified to advise others. However, there is a trend sweeping over the industry. Coaches are making revenue by coaching other coaches. That’s right, it’s one giant circle of coaching.
My business partner and fellow Lystener, Cassia, realized this during the creation of one of our early ventures, a virtual coaching app. Coaches release videos, ebooks, and training courses that they convince aspiring coaches to buy. We saw posts about courses promising to help people make $10k in the first month or 30 clients in two weeks. By the time the person realizes that the classes do not work, they have already spent money and it is too late. If you are thinking about coaching, the industry is harder than it looks. Make sure you understand what you are getting yourself into.
I have decided to save what I consider to be the best, for last. I personally had a 4 month battle with dropshipping at the end of 2019. I got roped in like most Dropshippers do: the videos of seemingly unimpressive 17-year-olds making millions of dollars. What I learned from this experience was that dropshipping takes a lot of time. A Dropshipper must do copious amounts of market research, marketing, and customer service. What was supposed to be an easy way to make boat-loads of cash became a full-time gig that made zero dollars.
The main issue with dropshipping was product selection and marketing. Selecting products is hard, and public interest changes quickly. For advertising, you will either spend days creating your own ads or hundreds paying for outsourcing. This doesn’t even include your domain name, website, hosting, and brand creation. I have since started an Etsy store. Etsy is a much better way to sell, it discourages dropshipping but allows some forms of external product fulfillment. I made my first sale within two weeks and have sold consistently since. I also sell on Amazon Merch, which is custom clothing fulfillment by Amazon. For both Amazon and Etsy, I upload designs and allow outside providers to do the rest. It isn’t hundreds of thousands of dollars, but it is supplemental income.
If you are looking to make some extra money, you aren’t alone. There are real ways to make real money, you just need to know where to look. Below are a few side hustles that are both legitimate and lucrative when done correctly.
- Tutor online
- Sell designs on amazon
- Proofread professional writing
- Start a Blog on something you’re passionate about
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