Free Time Finance Pitfalls: 3 Hobbies That Won’t Make You Money
Wednesday, July 20, 2016, 6:00 AM | Leave Comment
Many people are driven to find ways to earn extra money but with time such a precious and squeezed commodity, they often look at cutting corners and finding ways to turn a fun hobby into an activity with profit potential.
While the ability to make money on a hobby sounds great, the reality is far less rosy.
Let’s take a look at three hobbies that people often think will turn into profit machines, yet rarely do.
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The Problems with Coin Collecting
Coin collecting sounds like an innocent enough hobby and with some coins selling for tens of thousands of dollars, it seems to have great potential for profit.
The experts at Rocky Mountain Coin warn that, most often, coin collecting is an expensive venture—not a profitable one.
Coin collectors must remember, however, that while they may enjoy collecting coins year after year, they won’t always be able to find sellers.
The coin market has ups and downs, just as any market does. That can make a coin collection very illiquid—difficult to turn into cash. Worse, the value of coins can fall during a down market, which could leave the collector with losses rather than profits.
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Issues Faced by Antique Collectors
If you’ve ever watched an episode of Antiques Roadshow or American Pickers, Pawn Stars or Storage Wars, you might have the idea that buying old pieces of art, jewelry, furniture and tools is a great way to enjoy the hobby of collecting as well as the potential for making money.
But becoming an expert in antiques is a time consuming process that requires years of study. Without this kind of background, you’re more likely to get sold fakes and forgeries and you’re less likely to have your finger on the pulse of the market.
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Dangers of Network Marketing
In the 1950s, bored housewives often hopped on to the Tupperware train as a way to entertain themselves with parties and potentially earn an extra income.
Today, there are dozens of similar network marketing plans allowing people to throw parties and network online, all while both selling and buying their favorite candles, bags, makeups and soaps.
The problem with these network marketing products is that they require high buy-in fees, monthly website fees, and purchase minimums that few people will maintain.
Additionally, while friends and family may support your business in the first few months by buying your products, few will become lifetime customers giving you the level of consistent sales you need just to break even.
Hobbies are meant to be fun. There’s no need to mix your fun activities with your income acquisition. Keep those worlds separate so your business decisions aren’t tainted by your need to relax and enjoy yourself.
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