If you’ve repeatedly tried to get your finances into better shape by cutting back – and repeatedly failed – maybe you’re taking the wrong tack. Another approach to balancing your books is not to reduce your outgoings but to increase your income.
So, to get you thinking, here are four ways you can boost your income in 2015.
Let a room on Airbnb
It’s become increasingly popular in recent years, both for holidays for yourself, and as a way of boosting your income. People all over the State have caught on to the idea of letting a room, or your entire home, via
Airbnb
.
The good news is that "there absolutely is money to be made in it" says frequent user Fiona Morris (see panel). The typical price for a double room in Galway city, for example, is about €40 a night, or €60 in Dublin's city centre.
Letting it for seven nights a month could generate monthly income of €280 or €420 respectively.
Fees for booking accommodation on the site are shared by both the host and the guest. Airbnb takes a 3 per cent host fee every time a booking is completed on its platform, so a €450 booking will yield a payment of €13.50 to Airbnb.
But if you’re keen to let some of your home, it’s worth doing your homework first.
For Morris, “pricing is very important”. She manages the rates on her properties on a weekly basis, and every few days will adjust the rates depending on demand.
Keeping an eye on competition is also important. Morris uses the map facility on Airbnb to check out neighbours who are also offering accommodation – and what they’re charging.
“You have to be very competitive with your price,” she says.
Reviews are critical to success on Airbnb. Morris is close to getting her 1,000th review, and the overwhelming majority have been positive. Still, those ten or so negative reviews were “heartbreaking” she said.
“You have to go out of your way to make sure they’re brilliant at the start,” she says, adding that your home has to be “pristine” and you have to bear in mind that there’s a cost in renting out your home. The advent of water charges may make you a bit more mindful of the time your guests are spending in the shower.
“People expect so much, and you have to keep up that level and you have to maintain that all the time. You’re nearly only as good as your last review, so you really have to work on it always,” she says, advising newcomers to focus initially on “getting those amazing reviews. Once you have those, you’re laughing.”
Cancellations can be tricky, leaving the host high and dry if the guest cancels close to their arrival date.
One way around this is to opt for a “strict cancellation policy” which only offers a 50 per cent refund if the guest cancels more than a week in advance, and nothing if it’s later than that. It’s an approach Morris has adopted, but she advises that it can put potential guests off a bit, particularly if you haven’t built up a wealth of good reviews.
“I wouldn’t recommend it at the beginning,” she says.
Other options include a “flexible” policy, which offers a full refund if the guest cancels 24 hours prior to check in or “ moderate”, which gives a refund to guests only if they cancel five days before check-in.
Remember, however, that income earned on the website is liable to tax, and the Revenue Commissioners are looking increasingly at this.
The tax office recently published guidelines on its rent-a-room scheme, which allows you to earn €12,000 tax-free a year. It stated clearly that short-term lets to guests, “including where such accommodation is provided through online accommodation booking sites”, do not fall within the terms of the relief.
If you’re renting online, you should be prepared to declare this income in a tax return – whether you’re a PAYE employee or not.
Mystery shopping
If you frequently find yourself in a shopping centre or retail park, mystery shopping might be a convenient way of earning some extra funds. The job of a mystery shopper is to visit a business and pose as a typical customer. You then feed back any information about the shop or food outlet – such as the standard of customer service, level of cleanliness etc – back to the owner, via a questionnaire.
A number of operators currently hire people to work across the State as mystery shoppers, and the rates of payment can vary.
Pan Research, for example, warns that mystery shopping is not a “get-rich-quick” scheme. It pays between €15 and €50 for a visit of between five and 40 minutes, plus additional time for an evaluation form thereafter. The rate for telephone evaluations is €7.50-€15, and you can expect to get an “average of anywhere from six to 30 assignments per year”.
Another operator, Customer Perceptions, says that a “good grasp of written and spoken English and good observation skills” are needed for the job, as well as “a real understanding of what constitutes good customer service and the ability to recognise it when you see it”.
Tupperware parties
Times may have moved on from Tupperware parties of old, but if the product has changed, the concept hasn’t.
Avon cosmetics was once popular but it departed the Irish market in 2013. Now everyone from stay-at-home parents to those thinking about a career change as well as those looking to top up their income from their day job are looking to sell via direct sales.
One option gaining traction across the State is US jewellery chain Stella & Dot (named after the founders’ grandmothers), which is quickly building up a field sales force in Ireland. It first entered the Irish market on St Patrick’s Day 2014 and now has 200 agents or “stylists” across the State, with plans to grow this to about 500.
The Irish fashion jewellery market is estimated to be worth about €40 million and is growing at a rate of about 5 per cent a year, so there is an opportunity to make money. However, people’s reduced disposable income may be a hurdle to making sales.
To get started selling its jewellery, you’ll need to invest €199 for a pack which includes samples worth about €400, catalogues and order forms. Thereafter, stylists can buy new collection samples at 50 per cent off.
“It’s essentially a business in a box,” says Veryan Eperon-Roach, country manager for the UK and Ireland. Stylists also get their own website, and are encouraged to sell both online and in so-called “trunk shows” such as coffee mornings or evening events.
Stylists earn commission on everything they sell – be it through the website or at a show – of about 25-35 per cent. Typically, about 80 per cent of a stylist’s sales will come from a trunk show, and a sales tally might be about €800. That means a stylist could earn €200-€300 from one event. Sales figures will differ, however, and some events may struggle to reach three figures.
“Some are much more and some are less, it depends,” says Eperon-Roach. But there is no pressure to sell a certain amount. “There are no quotas and no targets. There is no pressure to sell and no pressure to buy,” says Eperon-Roach, who is a stylist herself on the side.
Hostesses also receive an incentive for inviting people to their home, getting about 10-15 per cent of the event’s sales back in product credits.
“So you’re rewarded for hosting and for being a stylist,” says Eperon-Roach.
And if jewellery doesn't take your fancy there are other options. Swedish cosmetics companies Oriflame and FM Perfume and Cosmetics also hire retail consultants to sell their products across Ireland, and Oriflame promises "generous income potential and career opportunities".
Take in students
If you have a spare room or two and live close to a college, taking in a student or two could reap significant financial rewards. And, unlike Airbnb, you should be able to earn up to€12,000 tax-free a year from doing so, under the Revenue’s rent-a-room scheme.
While it may seem like digs are a thing of the past – after all students are now staying in penthouse apartments in Ziggurat’s student residence across from UCD – the rapid rise of rents in cities like Dublin means living in someone else’s home while attending college still makes sense.
If you’re well-located in Dublin for example, you could expect to charge upwards of about €130 a week for accommodation Monday-Friday, including breakfast and dinner. And the good news is that students will typically go home for the weekend.
Close to University College Galway, you should be able to let a room on a Monday-Friday basis for upwards of about €110 a week. Another alternative is to take in students who are staying in Ireland for the short term during the summer months on a language course. Airbnb monthly average: What you make in . . . HANOVER QUAY €444 RANELAGH €538 DRUMCONDRA €338 GALWAY CITY €404 BELFAST €239
Source: Airbnb Airbnb: Spanish style Fiona Morris moved to Barcelona four years ago with her husband and two children. However, the job which prompted the move quickly fell through, leaving the couple "high and dry with no work – and no Spanish either".
In need of a way to generate an income, and quickly, Fiona decided to turn their children’s playroom in the traditional high-ceilinged Catalan apartment they were renting into a guest room.
“My biggest concern was the kids”, she says of making the decision, but adds that they got used to the environment very early on.
“It was just a part of our lives and we made amazing friends and acquaintances from all around the world”, she says, adding that the downside was the “few odd people” they met along the way, as well as the visitors encroaching on the family’s space.
But it did provide much-needed income, with Morris estimating that they welcomed around 200 guests their first year.
“It paid the rent and allowed us to stay there,” she recalls.
But the couple’s Airbnb dream took a knock when a neighbour complained to their landlord about their venture and they were asked not to continue doing it. It was time for a change in any case.
“We wanted our home back,” says Morris.
The family moved to another apartment in the block and started letting out other apartments in the city to Airbnb tenants. Now with a portfolio of 14 apartments, the business is a full-time one, and the couple has just taken on their first recruit to help them manage the properties which are let via Airbnb.
