3 solutions to regularly boost your income from home

boost your home income by renting your spare roomHere you are, jumping up and down with excitement whilst waving goodbye to your older child, on their way to Uni or their own first home. Lost the plot? Not at all. It is of course sad to see them leave, but it might also mean the start of new opportunities for you and your home. Whether you've just reclaimed extra space in your home, moved into a new house with an annex or a guest studio; whether you're a stay-at-home mum or dad or working part time, why not make the most of spare room or extra time to boost your income without leaving your home? You could even combine this with exploring a passion you've had for a long time for a craft activity; specialist skills you under use and know are in high demand; or the opportunity to redecorate or update your house to create a new space for guests. It could also be a great way to make yourself a new source of income if you are planning a change of direction or a career break

1. Get extra income by renting a spare room on Airbnb

Do you have a spare bedroom or a basement you could convert into guest accommodation? You could earn a significant amount of income by renting it as a resident landlord. How much you charge per night depends on where you live, and the minimum amount of nights per booking is up to you. But you could earn thousands tax free every year as there’s a tax relief scheme in the UK (more on that later).

A quick note about disposable income. It is the net balance of what you earn minus what you spend. Could you also save on what you spend, for example on your home insurance?

Occupancy rates vary of course: Rule of thumb? Base your income projection on a 50% occupancy rate (so 26 weeks a year if you rent by the week) in areas highly appealing to tourists like Cornwall and Yorkshire. In other areas you might only rent your guest room a handful of weeks across the year but surely, it's still good extra income? Here's how much you could make on average as an Airbnb host depending where you live in the UK:

how much an Airbnb host can make in the uk

The net amount you’ll take also depends on how you choose to manage the bookings and the cleaning. You can do it all yourself. It does mean you might need to wait until your guests arrive to give them their keys even if it's late at night. You could also invest in an Airbnb Host smart keyless solution. You can also employ an agency to do all of this for you. They will take a cut but you might weigh up that you’d rather have a little less income and spend less of your own time managing it.

Can Airbnb make you money

Between July 2016 and July 2017, UK households have earned a total £657million through renting rooms and houses on Airbnb. So yes, you can make money out of having a spare room or listing your entire house. How much you earn fluctuates per area of the country: In the North East and the Midlands , you can get between £2,200 and £2,400 on average. In London the average earning rises to £3,000 (there is, however, a lot of competition with the highest volume of listings: 64,000). The area with the highest average earning is the South-West with £3,400.

How does Airbnb income get taxed

In the UK there is a rent a room tax relief amount in place. So up to earnings of  £7,500, the income you make that way is tax free. Over this limit, you’ll need to declare it to HRMC via a tax return form.  

What insurance do you need to rent a room 

If you are looking to list your spare room, annex or entire house occasionally on Airbnb, check with your home content insurance as they might not cover you for lets. You might need specialist airbnb insurance. 

If you are listing your spare room to find a lodger or a flatmate (in this case you might want to list it on a site like SpareRoom.com), again, your regular buildings and content policy might not extend to this. You can find out more and compare lodger insurance and landlord insurance here. 

2. Earn a living as a freelancer working from home 

There are plenty of ways to earn a living working from home, especially now that technology has enabled efficient new remote working solutions. You can develop your career as a Virtual Assistant. The range of duties and skills can vary a lot from one V.A. role to another. Check what your potential client expect from his or her V.A. carefully. It could range from: maintaining up-to-date accounts to managing day to day communications with the customers of the business; managing the diaries(s) of one or several of the senior executive members of the business; organising conferences and events, travel and accommodation; researching information and preparing and distributing corporate documents.

"Find jobs through Facebook groups, LinkedIn and websites like CloudPeeps"

Web and digital roles are very popular freelance choices as most of them can virtually be done from anywhere with a laptop and a good Wi-Fi signal, topped with the occasional trip to the office:  PHP developers and web architect; graphic designer; social media management; market researchers and UX. Finally if you speak another language fluently or have a teaching background, you could set yourself up to provide translating services or online tuition.

Where do freelancers find work

A lot of freelancers use sites such as People Per Hour to list their skills and cost rate. Aside from those, networks like LinkedIn not only have a section with job listings but also connections in your network that might facilitate an introduction. Recommendations is a proven, successful method for employers to find new staff members and suppliers alike - lets face it, if you were looking for someone to help you with a project, the first thing you'd probably do is ask your friends, family and colleagues if they would recommend anyone they know and trust. Action point: Get networking.

Georgia Gallone, a freelance Digital Marketing specialist confirms this in a short but sharp statement: "Besides word of mouth, I find jobs through Facebook groups, LinkedIn and websites like CloudPeeps". 

BetterTeam also lists recommendations as the top method to find the best person for a role: "Ask your employees who the best people were that they worked with and also look at companies your best employees previously worked at."

What insurance do you need if you work as a freelancer

First of all, do you need insurance at all?

Even if you just do admin work from home, you might still need car insurance for a start to get to your meetings and catch up with your clients. But perhaps, if you don't drive often, you could get a better solution than annual car insurance (and save money.)

Anyway, in terms of specific insurance for freelancers, you might need:

  • Public liability insurance - this is the part that covers you against material damage (i.e. product, equipment, property, etc.) and injury claims that result from negligence on behalf of you or one of your employees. If a third party experiences property damage, bodily injury, or is killed while completing your work, Public Liability Insurance can help you cover the cost of the claim as well as court and legal fees (depending on the terms of your policy). We'd like to thank Towergate insurance for letting us share their really clear definition of public liability. 
  • Income protection insurance - Shockingly, only 4% of self employed and freelancers have income protection insurance. And 42% of all self employed and freelance workers think they are not eligible for it. With 33% having only enough to pay themselves for 3 months if their source of income suddenly stop, it's a real worry. Both at individual level and as an overall contributor to the UK economy (Self-employment contributed £255 billion to the economy in 2016 alone). [Source: LV=]. 
  • Indemnity insurance - Professional liability insurance can protect you against claims that you incorrectly provided a contracted service or that the work you did was faulty in some way. Sometimes it's also referred to as error and omissions or E&O coverage.


3. Start a side hustle business from home

  • Side businesses are a UK growing trend - According to a recent study published by Henley Business School, 1 in 4 Brits have at least one "side hustle" business on top of their regular job. A "side hustle" is defined as a project that brings in extra income, or at least has the potential to. The trend has exploded recently in the UK, perhaps on the back of the success of mum bloggers, combined with the advance of remote working technology, the rapid growth of social media and the media showcasing people turning passions into profit. 
  • Get specialist advice for setting up a small business - Whilst following your dreams and turning your passion into a cash earning possibility is fantastic, you also need to plan and research what you're getting yourself into. Running a small business means constantly "swapping hats": One day you're Head of marketing, Sales manager, Customer Service, Accountant and so on. For generic advice, head for Gov.org or organisations like the Federation of Small Businesses. You might also find local "Kitchen Talent" events running near you where you can pick the brains of other micro entrepreneurs. Attending larger events in your niche industry is also a great way to listen to experts, network (that word again) and find out more about what you need to succeed.
  • Leverage social media -  Attending virtual #hours on Twitter (there are hours for a lot of local areas, but also for various crafts and markets like #weddinghour, #motorhour  or even #chickenhour. Those are a great way to connect with fellow small business owners. you can then get in touch with them by email, phone, or why not, face to face to exchange tips and advice on business plans. Again, as is the case for freelancers, beware of which insurance you need for your small business. 

In the end, be prepared to be patient. Whether you decide to rent a room in your home, freelance or start your own small business from home, building up clients and a new revenue stream takes time. The great thing is, planning ahead one or several solutions to earn a living outside of your 9 to 5 job might give you the freedom to do something else for a year or two. With sabbaticals more and more on the radar of employers looking after the wellbeing of their teams, it might be a path worth exploring? 

What do you think? Add your comments below......

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