Need new income stream

December 29, 2014 2:21 PM

What kind of business can I run that could bring me $30k + per year after expenses?

I make good money, but need to build some wealth and would like to have multiple income streams. What are some business ideas that could net me out some income that meet this criteria

1 - I don't have to manage it. I'm fine with paying someone etc. My current job is not able to take a backseat.
2 - Simple and perhaps scalable
3 - Can be done in a "smallish town" or virtually

I currently hold an executive level position
I am process minded and technically (vb / excel) gifted
I could invest up to $30k cash if needed
My wife and my son could "run" it if need be but not desired

I am not looking for MLM programs

Thanks so much
J

posted by jseven to Work & Money (7 answers total)

If you're willing to commit more capital, a franchise is always an option. Success varies.

You realize that if you could easily and predictably turn 30k into 30k+ per year that everyone would already be doing it?
posted by leotrotsky at 2:25 PM on December 29, 2014 [21 favorites]

The term of art here is "turnkey" business -- usually a franchise that someone else has put up money to get up and running, but here's the key, now wants to walk away with a profit. You need to figure that into the value of the business and any leftover cash flow. Naturally, they want you to cover the risk they took and handle all the work from here on out, one way or another. Beware, of course, that this term of art is used a bit like ads for apartments where "convenient to transit" means "train stops outside window".

If you have more to commit -- in the $250K and up range -- there are a variety of smaller-bore franchise opportunities. They usually want you to have a certain level of assets and, critically, a certain percentage liquid. And at that level you should think "sunglass kiosk in mall" rather than "fast food restaurant", of course. In my view the conventional wisdom has it that those seeking turnkey businesses are more mark than they are entrepreneur poised to reap a reward.

What a lot of people do at this level is invest in real estate. There is a lot of interest in flipping right now, but unlike before the financial crisis, most of this business is cash on the barrelhead. (Many in the business like to be in and out of an individual house in a matter of months. It's hands-on and crazy stressful.) Still, you might investigate your asset balance and see if you could try being a landlord. The advantages to owning rental property are not so much in the profits or the income stream (especially early on you're paying down mostly interest on a mortgage, just as with your primary residence), but instead in the ability to make a paper loss (with depreciation, and most expenses deductible) that can then offset other types of income you already have. But even one house, in a small town, isn't likely to gain you more than (say) $6-9K/yr cash, most of which will have to go right back into the mortgage or taxes. And a lot of people are just not cut out for the landlord game, with the 3am wake-up calls (though you can have a company handle that for a price) and the dealing with people aspects ("I just lost my job, can I go another month without paying").

So unless you can leverage that investment somehow, I'm not sure your views on an alternate income stream are all that realistic. You're going to have to put something down, whether it's cash or equity or sweat, to get the money coming in.
posted by dhartung at 3:06 PM on December 29, 2014 [2 favorites]

If you have at least a masters degree you could teach online (or in person) at a community college. I teach 5 sections of online courses each term and it pays about 30K. It's a nice chunk of extra cash that we can use for vacations, home improvements, investments, etc. Teaching online takes about 30-40 minutes a day, in my experience, then you have a big burst of activity for a few days at the end of each term as you grade papers and turn in final grades. But besides that it's pretty relaxed.

I teach at two different colleges. It was pretty easy to get both jobs. One required a masters degree the other required 9 graduate credits in the area of instruction.
posted by crapples at 3:34 PM on December 29, 2014 [6 favorites]

* Buy a brick-and-mortar business from a broker. If you look around, lots of troubled businesses are in that price range (gyms, coffee shops, etc). Of course there's a reason they're so cheap -- they have lots of debt and need a ton of work to turn around!

* You could use your $30K to get a bank loan to start a really, really tiny business. A Snap Fitness franchise might fit in your budget ... or MAYBE a Subway (but even that is pushing it). Of course it's a leveraged investment and you could lose much more than your initial cash.

* Or you could probably buy a VERY small business like a coffee cart in an office building for $30K with no debt.

* Learn something like web development and consult in your spare time. At $50 an hour, $30K isn't that far away.

* Maybe your wife and kid don't work now, but would be willing to work at a family business? Basically you would be "selling" their free time instead of yours. I could imagine a 15 year old who would balk at getting a real job, but would be willing to work at "his" own shop. Basically your investment would be buying a job for a family member who otherwise can't/won't work. This happens all the time -- think about your local Chinese place where a 12 year old is waiting tables.

* Buy a rental house. For $30K down, you could get a mortgage on a rental house for up to $150K. You probably won't make any cash flow, but there are two benefits: you can do crazy tax tricks to reduce your tax burden, and you can potentially make a bundle if the property increases in value. Of course this is a leveraged investment so the downside risk is very high -- if there's another financial crash you could lose the entire $150K!

* Invest in a tech startup. A lot of tech startups are seeking surprisingly tiny amounts of money -- I hear $50K a lot. Of course there's a 90% chance you'll lose it all. And you need to be an accredited investor for this (at least $250K income/$1m in the bank).

* Invest in the stock market... 6.5% long run returns, no real work ... it's pretty hard to beat, really.
posted by miyabo at 3:38 PM on December 29, 2014 [1 favorite]

Maybe farming. It's a risk.
posted by Bentobox Humperdinck at 7:41 PM on December 29, 2014 [1 favorite]

A business that returns more than 100% of investment in net profit in the first year? I think the first thing you need to do is revise your expectations, to be honest. Unless you're planning to deal drugs (somewhat risky, like the previous few suggestions), there is unlikely to be a business with that sort of returns in existence.

If you want to use that $30k as equity to borrow more, you have plenty of choice for good returns and just need to find one that has the mostly 'hands-off, just give me the money' model you're looking for. However, be aware that businesses that are not watched and nurtured don't tend to make money for long, so you'd need to have some presence (or, as you say, your family). If you're thinking longer-term, real estate is pretty safe (if you buy sensibly), particularly in a market that is scraping along the bottom. It may not give you $30k cash flow in the first year but can be leveraged into a fortune if you watch the market, make smart buying decisions and know when to say no.
posted by dg at 9:24 PM on December 29, 2014 [1 favorite]

From an investment perspective, you have 30k here and your wife's time. Assuming a generous 10% return on your investment, your wife needs to make 27k. Is there something your wife is super interested in? Basically she's selling her time and skills, because getting 100% return on investment is not going to happen.
posted by Kalmya at 6:48 AM on December 30, 2014