Cash flow. That’s what we’re all looking for. Even if you like your job and just want to retire comfortably, you still need to make extra money each month to have the lifestyle you want in retirement.
In looking for side gigs to augment your income, many of them come with an extra 10 – 20 hours of work. You have no problem working hard. But, you already work 60 – 70 hours a week.
So you need a way to make extra money on the side without putting in part time hours.
Stocks seem like the most reliable, time tested way to do that, but how? Where do you invest?
Let’s dive in and examine 3 strategies that you could use in the stock market to generate an extra $1000 per month.
NOTE: Before we go on. All of these numbers and calculations are generalized. We cannot guarantee any returns. This entire post is meant to guide your investigation down paths that may suit your goals. Complete you own due diligence before investing anything of your hard earned money.
How to make extra money with dividend stocks
Many companies pay a regular cash dividend to anyone who holds their stock. It’s usually quoted at an annual dollar amount per share. That yield is something many investors look for. Dividend yields vary wildly throughout the market, but average is 3% to 5%.
So if your portfolio returned an average of 3%, 4% and 5% here is how much you need to invest to collect $1000 a month in extra cash flow.
|Dividend Yield||Capital Invested|
Read our article about Canadian Dividend investing to learn more.
Can I make an extra $1000 per month day trading stocks?
Not if you wanted a side gig that doesn’t require part time hours.
Day trading can be lucrative, but it’s a special personality to make extra money day trading. You have to be completely emotionally removed from the result.
Day traders have a proven system that they follow religiously. They will watch 49% of their trade lose money while the other 51% make up the gains. Neither losses or gains can sway them. They have to be methodical, meticulous and ready to act.
We don’t day trade at Stock Hacker Academy. Very few of our students have invested the time and energy to learn day trading, but the rest of us are content to trade options at a much more conservative pace.
How stock options could help you make extra money each month
There are thousands of stock options trading strategies you could learn. Many of them are riskier than day trading stocks. But there are conservative stock option trading strategies that don’t require more than 15 – 30 minutes of attention each day.
You don’t make as much money with these strategies, but you are better protected should the market not go your way.
Stock Hacker Academy students saw 31 trade recommendations from our coaches last year. 31 of those trades were profitable. Their annual ROI was 12%.
Now, this does not predict the future here. There’s no way to guarantee a 12% return. We’re just using those results as a benchmark to see what is possible.
With a 12% annual return, you only need $100,000 of ready capital to collect $1000 / month in extra cash flow.
Obviously you won’t get a steady 1% return each month. Some months you will lose money. Others you’ll triple your returns. So if you’re need a reliable income stream, this may not be the place to start.
However, if you want to boost your investing and retirement saving ability, stock options could prove effective.
Read through our Options for Beginners series to learn more.
What do I do with this information
Which strategy caught your attention? Start there.
Investigate your options. Know what you’re aiming for. If you want truly passive income, dividend stocks might fit you best. If you don’t mind a bit of input (mostly on your phone), stock hacking (our specific style of stock option trading) may be for you.
Either way, this is just the beginning. Take your time and enjoy the ride!
That’s all for now.
Your fellow Stock Hackers,
🍒Cherry & Erwin
P.S. The market dropped almost 20% between January and June this year. Many are worried it could keep going. Will the market crash? What are you supposed to do if it does crash? We unpack all of these questions in our latest FREE report, “What to do if the Market Crashes in 2022.” Download your free copy now!