Must read for a few practical ideas you could try to make “extra” bucks on top of a day job.

Read Recessionomics 101: How to Make Extra Money »

According to my friend, Dana Cassell, who’s the editor and publisher of the Writers-Editors Network, the American Business Writers Association (ABWA) was a group of trade journal writers, formed before there was even an Internet, but it no longer exists. It did leave us with a really useful legacy, though… a highly useful formula to help freelancers figure out what to charge.

NOTE: For part-time income, just adjust the figures accordingly. The math’s easy.

1. Determine the annual salary you would receive if you were a full-time employee or staffer, doing the same or very similar work, revolving around the same or similar content/material.

Where you’re located is, of course, a factor. It’s probably not a good idea to use a New York City salary if you’re in Fargo, ND.

Example: $50,000

2. Determine your Net Hourly Wage by dividing #1 by 2,000 (which is the total number of working hours in a year, or 40 hours X 50 weeks).

Example: $50,000 / 2,000 = $25

3. To cover your overhead and direct expenditures, double your Net Hourly Wage (from #2 above) to come up with your Gross Hourly Rate.

Example: $25 X 2 = $50 Gross Hourly Rate

4. Cover your overhead time by increasing your rate by 25% (multiply #3 by 125%).

Example: $50 X 1.25 = $62.50 Billing Rate

Multiply that billing rate by the total number of hours you estimate it will take you to do the whole job. That’s how much you charge your prospective client to do the proposed job.

NOTE: Obviously, you don’t have to do this calculation each and every time you need to give a quote for a job. Unless there are substantial economic factor changes, after you’ve determined #4, all you have to focus on is properly estimating how many hours a job will take you to do.

I remember when videos on the PC were, well, were not. PCs couldn’t handle them. Heck, they couldn’t handle anything but the simplest of graphics and animation way back when. Now, I bet hardly a day goes by where we don’t see at least a short video clip on our computer screens. For someone like me who’s watched it evolve, the ride’s been quite fascinating and impressive.

Thing is, I’m not particularly fond of them as a medium for delivering information. Sorry, that’s not entirely accurate: In that information delivery role, in many cases, I dislike them immensely.

There’s no shortage of reasons for that. Since I have no particular need to come off sounding too whiny, I’ll stick with the biggest reason:

A video forces me to devote my full time and attention to it to get the info delivered to me. I can’t just quickly skim through a useful Table of Contents or even the whole “document” to easily get to the juicy bits I’m looking for. Or even to see if there are really juicy bits to jump to in the first place. I can’t even decide whether I can set aside the material for a later, more in-depth viewing and digestion unless I watch it first, at which point I may as well focus on the darned thing since I’m spending time and attention watching it already anyway.

This is a non-issue with content where the video format communicates info that really truly can’t be delivered in text or in print. A lot of Discovery Channel and NatGeo educational programming, for example, clearly oozes this value. It’s when videos are used in sales, marketing and advertising where the format often irks me.

In the vast majority of these sales videos, you see, the information can be delivered in simple text media (brochures, webpages, reports, white papers, etc. etc. etc.). In many of these cases — maybe not most, but definitely many — static visuals aren’t even necessary. Moving pictures? Speech and music audio? Special effects? Fluff. And as if that weren’t bad enough, it’s fluff that gets in the way of getting the information delivered quickly, efficiently and conveniently on demand.

The rub, as you’ve probably already figured out, is this: It’s for that very need-to-devote-full-time-and-attention reason that video is such a powerful direct sales tool.

If the goal is to really truly sell, for many if not most direct offerings, I hate to admit it, video is probably the best way to do the job. You want the prospect’s full time and attention to absorb your pitch. You don’t want them just quickly “skimming” through and “jumping to the details.” You want them already invested in you somehow even before they spend a penny out of pocket. You want to own their psyche for a substantial amount of time to ensure that your message not only gets through, but gets through now (and in today’s world, a few minutes is really really truly substantial psyche ownership).

The reason I bring this up: Written infoproducts don’t typically employ this most powerful of sales tools. Particularly by the “independents” who, at the end of the day, are writers, not marketers. How they usually package their online sales material is no surprise — writers write. Sales letter? Check. Catalog page copy? Check. Classified ad? Check. Writing writing writing writing writing a plenty… but no videos.

If you find that this describes your operation (or makes you squirm uncomfortably, too close for comfort) and your sales figures aren’t really making your bank care too much whether you exist or not, maybe it’s time to take a serious look at implementing videos as your chief online sales tool.

I say “chief” since, like me, you’ve probably been to sites where the videos are so obviously merely supplementary and even duplicates of information you know appears on, say, the product’s catalog webpage. Why in heaven’s name, for example, would I want to sit through a slideshow video that does nothing but regurgitate the same bullet-pointed details and specs that are so very obviously just a click or two elsewhere on the site? It’s clear that our objective is to have at least one thing on that video that your prospect really wants to know — or thinks s/he really wants to know — that isn’t available anywhere else except on that video… and, of course, your product.

Anyway, no segue here to more information on “how to do your own sales videos.” Just giving you (us, really) some infoproduct marketing food for thought.

This is actually the formula I prefer to use. It’s simple, and based predominantly on an even simpler goal: how much money you want left in your pocket (profit) at the end of the year.

You’ll find that having a numbers goal is a motivationally helpful tool to boot.

1. Specify how much target profit you want from freelancing at year’s end. Profit, if you’ll recall, is your net earnings (what you keep) after expenditures.

Example: $75,000

2. Divide your target profit by 1,500, which is the total billable hours you have in a year, to get your target hourly profit.

We get 1,500 by multiplying 6 hours in a day (remember, 1/4 goes to overhead) by 5 days a week, which we then multiply by 50 weeks for total billable hours a year.

Example: $75,000 / 1,500 = $50

3. Take your total weekly expenses (Internet access, rent, supplies, phone, etc.) and divide that by 30 hours to get your overhead per hour.

Example: $525 / 30 = $17.50

4. Add your target hourly profit to your overhead per hour to get your billing rate.

Example: $50 + $17.50 = $67.50

One of the things I like most about this formula is that it’s relatively easy to adjust the numbers accordingly, depending on the amount of time you want to achieve your goal (say, instead of $75K in a year, you want to get $50K in 9 months).

Note to Teachpreneurs: The figures used in the formula can be easily adjusted, of course, to reflect part-time hours and targets.

With many of the scams listed falling within the “opportunity,” “money making” and related categories, this is a must-read. Or at the very least a must-quick glance-through.

Be careful out there!

Read The Biggest Consumer Scams of 2009 »

More info on The Teachpreneur Guide to Article Bucks »

What is Google AdSense? It’s probably just the easiest and fastest way to start monetizing your website’s traffic. The best part: It’s free to join.

I take that back — there are a lot of “free to join” programs out there, so whoop de doo. What does make it stand out, though, is that it’s run by giant Google, which has a number of what I call “business smart” implications:

• Very low possibility of you getting stiffed. They pay, in other words. Rich, high visibility, practically no risk of them up and disappearing anytime soon… all warm and fuzzy indicators that if you earn any AdSense money, it’ll work its way to your bank account.

• AdSense isn’t new. Google’s been running it for a few years now. No doubt a good bet that you’ve seen AdSense ads — again and again and again. They’re all over the place. Because the system works.

• The advertising pool isn’t meager, nor is it going to dry up anytime soon. AdSense is able to pay us “publishers” because it works for advertisers. Which means that advertisers use it. Heavily.

Sound cool? Of course it does. It gets even cooler when you get the gist of how it works technically:

• Copy and paste the AdSense code into your site’s source code (you basically control where the ads appear on your site).

• The ads go live on your site. Google detects you running their ads. They automatically scour your site’s content (or already have… Google’s a search engine, remember?), and determine your site’s topic(s) based on keywords.

• Advertisers have already told Google what sites they want their ads to run on (actually, most just tell Google what keywords they want, but same difference). So…

• …every time a visitor to your site looks at one of your webpages that’s running an AdSense ad (or block of ads), Google automatically and dynamically feeds ads to you tailored to your site’s content and your audience’s interests.

Your visitor sees an interesting ad and clicks on it. S/he’s taken to an advertiser-specified destination, wherever that may be; Google records the click and credits your account the value that the advertiser has told Google it will pay for each of those clicks.

Ta da! You just made some money. Sure, it’s usually just a few cents, but it’s a few cents you didn’t have a click ago. And the few cents (and clicks) do add up. Many modest sites make a few hundred dollars in clicks each and every month; imagine how much heavily-trafficked sites make.

Maybe you’ve also realized that despite all the techie coolness just described, all you’ve really worried about and hassled with at this point is your site and its content. No advertisers to find, service, and collect from. You aren’t selling anything (the advertisers try to do that, obviously, but heck if that’s your problem). Heavens, you’re not even pushing folks to click on the ads — Google, in fact, doesn’t allow you to do that. It just happens while you go about doing and working the stuff you enjoy doing and working.

So, what do you need to do to get this thing going? Here’s a quick and dirty step-by-step:

1. The first thing you need is — surprise! — a website and/or blog. Don’t have one? Here are some dirt cheap resources to check out if you want to get a site started and going:

• Blogger — Free. Relatively easy to use. And the fact that Google owns it too doesn’t exactly hurt.
• Site5 — Low-cost hosting; lowest cost as of this writing is $5/month; lots of other “budget” hosts out there, this is just the one I’ve been using for various projects.
• GoDaddy — Where to get your dot com domain name. A domain is a must with a Site5 hosted account, useful for Blogger (but not necessary). Frankly, at only around $10/year per name, go get one.

2. OK, let’s assume you got your site up and running. We’re also assuming you actually minimally know how to create/edit pages, etc. (sorry, but yeah, you need to know this stuff or have a friend who’ll do it, or lacking either, enough bucks to pay someone else to do it… no different from having a car you want to travel cross country with — drive it yourself, get a pal to do it, or hire a driver).

Now it’s time to get an AdSense account. Click here to apply for and get one (it’s free!).

It’s been a long while since I actually applied for mine, but the application form looks pretty straightforward and should be easy to figure out.

3. You’ve been accepted. Now for the fun part: getting AdSense ads onto your site. The steps I describe below make up the simplest, most direct straight line way to get from point A to B. There are options, which you most certainly should explore, but they all revolve around and support this basic step-by-step process that follows.

Note to Blogger users: Skip all the steps below (yippee!) and go straight to Blogger and read their instructions. Last I checked, they’ve actually set up a way to automatically integrate your AdSense ad feed with the free blog you’ve set up on Blogger.

The rest of you, Login to your AdSense account and click on the AdSense Setup tab.

4. Click on AdSense for content.

5. Make sure the Ad unit option is selected, and set to Text ads only (default). Click on the Continue button.

6. Select a format. AdSense advertisement blocks come in all shapes and sizes. The numbers indicate the width and height in pixels of the ad. Probably the most common is the horizontal 468×60 banner, which means a space 468 pixels wide by 60 pixels high.

Choose a format size (which should fit the space on your site you want to put the ad in). For the rest of the options on the page (colors, fonts, etc.), just go with the defaults for now. You can always change and regenerate ads later, as need.

When done, click on the Continue button.

7. Ignore all the channels stuff for now (another one of those options you should explore on your own later), and just click on Continue.

8. Also go with the default value for the AdSense unit name option. Again, explore this further later if you want. Click on Submit and Get Code.

9. Voila! Your AdSense code’s ready. Click within the textbox on the screen with the code; the code will be automatically highlighted and selected. Copy it (easiest way to do it on Windows: just right-click on the highlighted text and click on Copy to copy all of it to your Windows Clipboard for pasting elsewhere).

10. Now go to your website’s source code and paste the code you just copied exactly where you want the AdSense ads to appear. You’re done!

As you can see, the process is pretty simple and straightforward. Have fun!

Just some thoughts and notes on writer’s websites (or any website for that matter), in response to the usual newbie (let’s pretend that’s you) inquiry on whether one should invest in a website or not.

No brainer? Well, since the assumption is that you’re a writing industry newb, you won’t have any clips yet. So, should you spend money on a website/Web hosting?

The easy answer is no. But here are a few things to think about:

NOTE: For the $$$ figures, I like rounding the numbers (usually up, since we’re costing). Makes it easier to do the math in our heads.

• Whether you have a site or not, lock up your domain name (e.g., yourname.com). Try to stick with dot com’s, dot net’s if you must, maybe even dot org’s, but the other unrestricted TLDs (.biz, .info, .name and who knows what else they come up with) I consider as why bother’s. Your call, of course, and a domain with a less desirable TLD is still way better than nothing.

Cost: $10 a year. I use GoDaddy for my domains.

• Budget Web hosting also rounds out to about $10 a month. Yeah, that’s $120 annually you could save… but it’s also a darn cheap educational cost if you’re fairly new to all this Web tech stuff.

For learning all of this, there’s nothing like having your very own “server” that you can futz around with to your heart’s content. You don’t even have to buy books; lots of information online (but again, a book or two is still cheap education). Besides, better to learn now, while at the playing around stage, than later, when you’re mission critical.

I currently use Site5 hosting (things change a lot in this universe). Heard good things about Hostgator also (but I haven’t used it). Tons of other hosting providers out there, and it’s a buyer’s market.

• Won’t having an “empty” site with no clips look bad to prospective clients and publishers? It depends, but best assume the answer’s “Yeah.” But who the heck said that you have to tell them you’ve got a site? Only send them there when you’re darn good and ready!

• You’ll want to start a blog, even if you’re not running your own hosted site and doing your blog on a free host like Blogger or WordPress.com. The technical experience and practice help.

More important: Sign up for Google AdSense and start running their ads on your blog (coming tomorrow: an old primer on AdSense I wrote that’s still good enough to get you going). Why? Because with very little effort, you can probably generate at least $10 a month in Google AdSense advertising revenue.

Now where’d I see that figure before? Oh yeah, that pretty much covers your out-of-pocket Web hosting costs, doesn’t it? Now we’re talking free education!

I don’t know why, but one question that seems to stress out a lot of newbie freelancers is how much to charge per hour for their work. One possible contributing factor is that there are so many different ways to work the numbers. In my book, that’s a good thing.

The Gross Earnings Formula is one way to do it — it’s simple, but often effective, particularly if you’re only freelancing on a part-time or periodic basis.

1. Determine what your total target earnings is (how much you want to make total at the end of the work period).

For example, let’s say you want to buy a used $3K motorcycle, so let’s make $3,000 your target earnings.

2. Specify the period of time you have to reach your target earnings, and calculate how much you need to make per period.

Example: You want the money at the end of 4 months. This then means that you’ll need to make at least $750 a month ($3,000/4) to hit your target.

3. Figure out how many hours you have to work per period.

Example: You have 80 hours available to work each month (approximately 20 hours a week).

4. Divide your periodic $ target by the total number of hours available to you.

Example: $750/80 = $9.38 you need to make per hour.

5. Multiply your minimum hourly by 4 to cover your overhead (both time and expenses).

Example: $9.38 * 4 = $37.52

The example shows that you will need to charge $38/hour (round it up, what the hey) to hit your target in the amount of time you’ve got. External factors (like what the local market will bear) don’t come into play — just your raw financial situation in black and white.

The 4x factor in step 5… how’d I come up with that? I have no idea; I just picked that up from a few freelancers I know, have tried it, and by jove, it pans out. (Comment below, please, if you know the answer to this.)

You all know the basic ebook publishing business formula — write and publish an ebook, put it up online for sale and instant download. That isn’t the only way that ebooks can be used, however, to help you generate income. Here are a few other ways that quickly come to mind:

Make money from advertising. Publish an ebook and give it away for free. Fill it up with ads. You can charge others to run their ads and/or you can run your own (affiliate programs).

Build a mailing list. Again, give away an ebook for free, but folks will need to sign up and subscribe to your mailing list to get it. Mail promos to the list regularly. TIP: No one said you couldn’t combine this with the “advertising” thing above, or any other money making strategy for that matter.

Generate traffic to your site. Your freebie ebook can be used to draw traffic to your site, where you can then expose your visitors to other money makers, such as advertising (AdSense, affiliate stuff, paid ads).

Establish your reputation and expertise. The money here’s indirect, but could get surprisingly big, actually, depending on your industry. Your freebie ebook can be pretty much used to the same effect as a dead tree book to help set yourself up as a “published” authority on your subject matter. (The trick, of course, is that your ebook better be drop dead pro and pretty darn good.)

Sell resell rights. Maybe you sure can write up a storm but can’t sell worth a click. Others can. So ask them to pay you for the rights to resell your ebook as their “product.” People already do this, so you probably won’t really need to “educate” anyone on this concept.