How To Make An Extra $500/Month Renting A Room In Your Home
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Money.
It's a weird thing. Some people can't get their hands on it while others seems to have crap tons of the stuff just lying around.
I was in the first camp when I realized it was time to start paying off my student loans. I wasn't exactly living paycheck to paycheck. I had enough money to pay for my bills and save a tiny amount (like $100). It was pretty clear that if I wanted to get out of debt I'd have to do something drastic.
I thought about the usual ideas of starting a blog, becoming a freelancer or even babysitting. When I thought about what it'd take for me to get there, the ideas became much less appetizing.
I honestly wasn't interested in cutting time with my daughter or losing sleep to work extra hours. I spent so much time freelancing and working on campus while I was in grad school that I averaged 3 hours of a night. During that time, the only time I spent with my daughter was when she'd read me bedtime stories before I passed out because I was almost always running on fumes. No amount of money could entice me to go back there again.
I wanted to somehow bring in more money without changing my lifestyle.
Out of the blue, as I was contemplating what seemed like my inevitable return to freelancing and #TeamNoSleep, one of my best friends called me with an offer I couldn't refuse. Her grandfather was visiting for a few months and needed a place to stay... and he'd pay $500/month.
Like magic, the room my daughter was living in for free (that cheapskate didn't even pay for her own groceries!) was now earning me $500.
For each of those months, I was able to double my student loan payments.
Why This Works
Making money isn't the only tool in your arsenal. You just need to create a gap between how much you make and how much you spent each month.
Let me break this down for you:
Earnings - Expenses = $$ Available
That means you can increase your earnings or decrease your expenses to have extra month at the end of the month. (Or you could be super gangster and do both!)
I was never too broke to pay off my student loan debt.
In fact, I was making more than enough money to get out of student loan debt within a few years. I didn't see it because I was spending $1600 for rent, $150 for car insurance, $100 for gas, $75 for internet, $70 for gas and electric and $500 on my student loans - there's no surprise there was nothing left over to make even higher payments.
When grandpa moved in with me, he lowered my living expenses by paying a portion of my rent.
This meant that the gap between what I was making and what I was spending increased dramatically - without having to lift a finger.
How You Can Do It, Too
If you're trying to get out of student loan debt like I was or simply trying to save more money, renting out a room in your home is a great option to lower your living expenses and increase how much you keep in your pocket at the end of the month. Here's how you can get started:
Research before setting your pricing
When my friend called me up, I'd never thought about renting my "extra" room out to anyone. So pricing was nowhere near my radar. Also, this was one of my best friends so it felt more like letting an uncle stay with me for a while. She threw out the $500 number and I happily agreed.
Before you open your home to someone, though, you should definitely think about what it'll cost you to rent this room to them. If you plan on getting a monthly renter, take a look on Craigslist and see what other people near you are charging for similar rooms. If you want to rent your room nightly to travelers, you can check Airbnb.
Advertise your listing
While I didn't have to advertise my listing, I've definitely rented before. I would start with advertising to friends and family. Simply let them know you have a room for rent and ask if they know anyone. You'd be surprised with what you can find within your network just by asking.
Then there are the online options. If you're looking for a long term renter, you can post your listing to Craigslist. For a nightly renter, you can post your available room on Airbnb.
Clean + Furnish The Room
Grandpa ended up renting out my daughter's room. This made the most sense because my room was big enough for my daughter and I to share and my bed was larger (it would've been pretty awkward to share her full-sized bed for a few months). We took all of her clothes and toys out of the room in preparation for grandpa's arrival.
You'll want to have basic furnishings (a bed, dresser, night stand and a work desk) in the room whether you're doing a long or short term rental. I don't even consider an Airbnb for night if it doesn't have a place where I can pull out my laptop and rock out a blog post or two.
Set Rules & Boundaries
Once grandpa came in, I showed him where things were. I showed him to the bathroom, his room, the living room and where everything was in the kitchen. I told him what time I get ready for work and what time my daughter gets ready for school. (I grew up with four sisters and one bathroom so I know the value of having a system when you're sharing a bathroom.) I also talked to him about what time we go to bed and wake up so he knows when to expect more noise then usual (and when to keep his noise levels down).
By telling your new roomie what to expect when living with you, there are no surprises at all. You might even be surprised at how much their respect your sleep, alone time and that fast-paced bathroom time in the morning.
But what about my privacy?
For the first time ever, my daughter and I would be living with a man. While we'd grown accustomed to walking from the bathroom to our room in a towel, we'd get fully dressed in the bathroom before coming out. I also opened my room 24/7 to my daughter. Both of these were changes I was happy to make because I could see the reason I was doing it and the pros far outweighed the cons.
You'll have to decide what's important to you. In renting out your room you are opening your home to someone else. This, without a doubt, takes a way some of your privacy. There will always be someone if your home. They will hear you through the walls (and you'll hear them sometimes).
The best way I've found to keep this in perspective is to put a picture of your end goal somewhere where you can see it every day. I created a vision board to remind me of my student loan payoff goals. There was never a day that went by where I didn't remember why I opened my home, why I gave up my privacy and why I'm happy to do it again.
Side Note: If you want to create a vision board, my FREE Big Vision Checklist will walk you through my step by step process to make one. Click here to download it!
I've never done this before. How Do I keep My sanity?
Three key things will help you keep your sanity:
Don't sweat the small stuff.
Pick your battles.
Automate, when possible.
Every morning, grandpa would wake up and sit quietly until I came to turn that computer on. I once tried to show him how to do it - and after 2 minutes of frustration clicking around all the apps on the screen, he threw his hands up and said "can you just put it on for me?"
That's what it was.
Every morning before work, crusty-eyed or rushing out the door, I would have to stop to put the computer on for grandpa (the entire time he called it a TV). Then every night I would have to turn it off.
Though it was slightly annoying at first, it became our new way of doing things. Each morning, I'd walk into his room, say good morning and turn on "the TV." Sometimes we talked about what was happening on Aljazeera. We has conversations about the president. We started to bond.
Don't take everything personally and don't make a big deal out of the tiny details. Just enjoy the cash flow.
