How to build job-free income streams which suit your life

RoadSignThis week I’m going to tackle a slightly more advanced problem which you might encounter whilst trying to build a life without a job.

Here’s the thing. All job-free lifestyles were not created equal.

In fact, I know from experience that, although being your own boss is one of the most liberating experiences you can have, it’s also possible for the self-employed life to become just another rat race.

In order to actually enjoy your job-free life, the question you need to answer before you start building it is not

How can I make an income without an employer?

Instead, you need to be thinking along the lines of

How do I want my life to look?

But more about that later. Let’s start with a bit of context.


This article actually evolved from a brief email exchange I had with a reader. He asked me for my opinion on his situation and my answer started getting a bit in-depth (there were diagrams!) so I thought it was worth sharing with the group, so to speak.

My reader requested anonymity, so I’m going to obscure a few of the details. However, I think the principles I’m going to talk about are broadly applicable and so, if you’re planning a self-employment-based escape from the rat race, I think you’ll get some value from this.

[As a brief aside, if there are any particular topics you’d like me to address in future, don’t hesitate to drop me an email and I’ll see what I can do]

Let’s call my friend Robert. The great thing about Robert is that he’s already successfully quit the (original) rat race. However, his situation’s not quite how he wants it yet. Robert would like to improve on his current position and get his work/life dynamic a bit closer to his ideal.

I’m going to take you through the main topics I’d expect to cover in a coaching session if Robert asked me to help him plan his next step.

Falling out of love with a self-employed gig

Robert used to be a university lecturer.

When he and his wife started planning to have a family, they decided that Robert would become a stay-at-home dad. It made sense for the family as Robert’s wife was the main income earner by quite a stretch and they would struggle to get by with just one academic’s income.

I personally think that they could be a bit more frugal and still be happy, but, unto each his own I suppose.

Robert’s original drive to become self-employed then was a desire to continue to contribute some income towards the family’s requirements whilst still being present for his child(ren) when his wife was at work during office hours.

Robert knows his subject (History) well. He lives close to a couple of universities (one of which he used to work at) and also several secondary schools and sixth form colleges. To achieve his goal of setting up a tiny business which fit around his family commitments, Robert made the most obvious choice and started advertising his services as a tutor. He now helps students of a variety of ages/academic levels become more successful.

When he started the business, it made perfect sense. His credentials are impeccable, he can teach his specialist subject all the way up to postgraduate level and the work pays well enough that it makes a meaningful dent in the family’s income requirements.

But there are a couple of problems.

Firstly, schools and universities tend to operate during the week and in term times. Pretty much all of Robert’s tuition clients require his services outside these times. Unfortunately, Robert’s daughter is coming up to primary school age and so, if he carries on doing his work during weekends/evenings/academic holidays, he’ll never see her.

The next problem is that, although the income Robert earns from tuition is reasonable, the business still requires a lot of time investment on a weekly basis to earn a decent amount of money. The 4 Hour Work Week it is not!

In summary, although being a tutor has played a massive part in Robert’s journey away from employment, perhaps it doesn’t fit in with his desired lifestyle quite so much as it used to.

So, what should he do?

Job 1: Test higher rates

Before I get into the deeper concepts, it’s worth just making one very obvious point. If Robert can earn more for the work he already does, he can do less of it and hence the lifestyle impact of his existing business could be reduced.

The truth is, most people who sell their time for an hourly rate sell themselves short by a huge margin. When Robert told me his current rate, it looked very much like he used the formula

Take your last full-time salary and work out your hourly rate. Then add £5 per hour.

You might remember however, that I recommend you try to double your income productivity before quitting your day job. Robert has definitely not achieved that.

The reason most people don’t achieve a massive increase over their employee hourly rate when they start a small service business, is that they immediately jump to this conclusion:

That’s absolutely crazy. There is NO WAY that anybody would ever pay me that much for X.

Sometimes they’re right.

However, most leave a massive amount of potential income on the table because they’re not willing to test whether or not they can charge a much higher rate.

I made this mistake a lot when I was younger. But as my experience has grown, I’ve made a counter-intuitive discovery:

Every single rate increase I have ever attempted has been successful.

I now sell my time for between 5 and 6 times as much as I did when I started my first business. Granted, I’m more highly skilled than I was then, but I’m also a lot braver when it comes to asking for what I’m worth.

Remember, trying and failing is not the same as letting your limiting beliefs stop you from trying in the first place.

Testing higher rates is the only sensible way of being able to make a confident statement about what price the market is willing to pay for your services.

Here’s how to test the market to find out the highest rate you can charge.

  • Keep all of your existing clients and any new clients that they refer to you on your old rates. This will ensure that your income won’t drop whilst you try out your new rates.
  • For all new enquiries, add some amount (£5 per hour?) on to your usual rate when you explain the costs.
  • Repeat for 10 or 15 enquiries (accept that your conversion rate might drop). If the new hourly rate will allow you to be more profitable for the same number of billable hours (i.e. enough new enquiries are converting) then the rate rise was successful.
  • Repeat until you’re at the rate you’d like to earn (or until the market won’t let you push any higher).

Now start telling existing clients who are paying the old rate about the increase. Offer them a generous switch over period during which they will be grandfathered on their old rate. Fire clients who are not willing to pay you more.

Note that if you want to try this, you might have to target your advertising more carefully to ensure that you’re talking to people who are willing and able to pay your new higher fees.

OK. That deals with the obvious first bit of advice. Now, on to the more complex issues.

The box

In order for any of us to survive without a job, we have to have at least a small amount of vision. Most people have jobs and so, by definition, if you want to live without a job, you’re behaving differently to most people.

If you do manage to earn money outside the confines of a job, you have officially passed your Thinking Outside The Box 101 introductory-level qualification.

I feel a graphical intervention coming on:


I’ve drawn my own situation there as well as Robert’s just to point out that this article isn’t a criticism of how he’s gone about achieving a job-free life. I derive the vast majority of my income from applying my engineering skills as a freelancer. This suits my lifestyle really well and there’s nothing wrong with it. However, it didn’t take much imagination for me to go from employee to freelancer. There are millions of other possibilities which I could explore if I wanted to.

So, there it is. If you’ve crossed the boundary from employee to freelancer or small service business owner, you have thought outside the box. This is commendable, and much further than the majority of adult humans will ever get.

However, this initial transition was likely to have been the path of least resistance.

An expedient.

An answer to the question

What will get me paid quickly?’


What can I do which will allow me to sell my time to clients instead of an employer?

It may or may not be suitable to adopt as a long-term strategy.

If the first version of self-employment turns out to not suit your lifestyle requirements, then it might be sensible to start studying towards your Advanced Thinking Outside The Box certificate as illustrated here:


The green area represents all of the options which are ultimately open to you given your skills, personality and general situation.

Just as it took effort to break out of the blue box and in to the yellow one, getting outside the yellow box so you can see all of the other opportunities available to you will be very hard work.

It starts with a bit of creativity.


If I was in Robert’s position, I imagine many thoughts would pass through my mind.

In particular, I might muse about how my current business works and how I could modify that approach:

  • I currently sell my time to one person at once. Is there a way I could, for instance, leverage large groups to make my income production more efficient? Perhaps I could design a class of some sort which is taught to 30 adults  at once. Maybe it could be a hobby history seminar about the second world war which I taught to middle-class retired people who were part of something like U3A. If I made it repeatable, each time I ran a 2 hour event, I could bring in a couple of hundred pounds with no extra set up costs required.
  • I currently have to fit in with the convenience of my clients.  Could I find a way to deliver value using my existing skills which is not bound to somebody else’s strict timetable? Perhaps I could use my experience of academia and my advanced essay writing skills to become a proof reader. People could send me documents which might need to be turned around before some deadline or other, but exactly when I did the work wouldn’t really matter. I could do this for students but my skills could equally be applied to corporate documentation or helping out publishers of academic reference books.
  • I currently sell my labour directly. Perhaps I could use my skills to capture some value which could be delivered repeatedly. I could find an under-served niche relating to something I know a lot about which many people search for online. I might spend a year or two putting together an authority website, complete with some digital products that I could sell to visitors. I could focus on History but this isn’t necessary. Perhaps one of my hobbies is in a niche which would suit this approach.

That obviously wasn’t an exhaustive list, but I’m sure you get the picture. Robert needs to look at the way he currently makes money and question every aspect of it.

He must really engage his imagination. He must leave no assumption unturned!

Having come up with the seeds of several candidate ideas/approaches, Robert’s next task is to filter them according to his estimations of their economic viability and by comparison to his goals.

To achieve this, Robert needs to ask himself some questions.

The questions

First, what would an ideal solution look like in terms of his day-to-day experience?

  • What’s the maximum amount of time you’d ultimately like to spend working (on average) each week?
  • When would you like to do the work? Would you like to be able to do it completely at your convenience rather than fitting in with other people?
  • Do you want to be able to go away and leave the business completely for extended periods of time?
  • How much do you (ideally) want to earn? Per hour? In total?
  • Do you intend to keep your existing business going to some degree? How much time would you like to spend on that each week? Perhaps draw up an idealised timetable for a single week.
  • What kinds of things do you think you would actually enjoy doing? Beyond the enjoyable activities, what activities could you tolerate?

Next, what resources does Robert have available to build his new income production strategy?

  • Over and above the amount of time it will take you to keep your current income, how much time each week can you spend on establishing the new income stream(s)?
  • How long are you willing to plug away at establishing the new income stream before it starts to bear fruit?
  • Are you willing to risk some of your own financial capital on the new venture?

Going through the brainstorming exercise and then answering all of the questions above should allow Robert to put new business ideas into one or more of the following 3 categories:

  • Ways in which I can provide value [i.e. what I can do]
  • Activities I like (or can at least tolerate) doing a lot of [i.e. what I am willing to do]
  • Activities which fit in with my desired lifestyle

But the most important 4th category which Robert has to be very careful not to overlook is this one:

  • Products/services which people will pay for [i.e. what there is a market for]

And this is where the real work is needed. It’s easy to convince yourself that there’s a market for your product or service, but there’s only one reliable way to find out:

Find people in your target market and ask them for money.

Note I didn’t say to ask them if they’d be interested, I said ask them for cold, hard cash.

So if, for example, Robert came up with an idea to become ‘Robert the Dissertation Doctor’ who charges £100 to proof read an undergraduate dissertation, he would be well advised to try and find some customers before getting any further into defining exactly how the business is going to work.

New business ideas rarely succeed fast. However, it’s important to make them fail fast to prevent you from wasting time flogging a dead horse!

Anyway, performing some basic market research should allow Robert to quite comprehensively assess each idea.

Oh no, he’s started drawing again…

Any idea Robert has can now be plotted on a Venn diagram (obviously… :-)) like this:


A to B

I’d say that Robert’s existing tiny business is in the area marked A (a viable business which doesn’t entirely fit in with his lifestyle any more). To get what he wants, he needs to design and execute a plan which will result in him getting to B.

So in summary, if I wanted to achieve the sort of change that Robert seems to be after I would:

  • Conduct a very open-minded brainstorm considering all of the possibilities available to me in order to generate some ideas. Whilst doing this, I would question all assumptions I might have inadvertently accepted as truths and try to be as creative as possible.
  • Filter the ideas against my lifestyle goals and, more importantly, whether or not they are economically viable. Remember, if you haven’t proved that there’s a market for it, then you need to find out for sure ASAP.

Oh, and one last point for those of you out there currently in this idea generation phase.

Don’t get stuck at C

What I have seen many people do in the past is to inadvertently end up at C (things that are convenient and nice to do, but make no money) because they thought they were on the way to B.

A very pertinent example for the modern world: Maybe you read a lot of blogs. Maybe you’re a blogger. You’ve heard that some people make money from blogging. Perhaps you’ve considered turning your passion project into a business.

But have you thought about the fundamental economics of that proposition?

To make a non-negligible amount of money through blogging, you either need a lot of eyes to sell to advertisers (or to sell affiliate products to, or whatever) or you need something high value which you can sell to a significant portion of a smaller audience.

Can you (or are you willing to) build either of those businesses?

Look at as an example.

At the moment, the blog is quite new, but even in 3 years time and after a massive amount of work, I’d be lucky to get 100,000 unique visitors per month. If I tried to monetise that using advertising and affiliate marketing, I might make some reasonable amount of money, but, averaging the hourly rate out over a few years, I’d definitely be better off sticking to engineering.

On the other hand, I do leverage my expertise to offer a high value product (coaching services) to people who read this blog. Very few people out of a still tiny audience take me up on the offer, but in the context of a business which I really enjoy running (but we don’t rely on to feed us), that’s OK.

If I’d started this blog as a way to replace a £50k (or, to be honest, £20k) per year job, you could rightly classify me as insane!

So, to avoid ending up at C, it’s important to be able to answer the

And how do you intend to make money out of this?

question at the start.

I’m not saying that you can’t do it with something like a blog, but at least put a lot of thought into how to monetise it up front.

Anyway, Robert, if you’re reading. I hope that helps.

Other resources

Here are a few links to other resources which might be useful in your quest to design income production strategies which suit your lifestyle.

How to work 33% of full-time – if you can increase your income productivity, you can get some of your life back.

Freedom business case study 1: My computer business – an example of pricing myself as high as the market allows

To free yourself from the grind, be defined by your strengths – this might help you to brainstorm a bit more creatively

If you would benefit from some one-to-one help to generate some business ideas which fit in with your lifestyle, just get in touch.

Your turn

I’d be really interested to hear from anybody who has taken the plunge into self-employment but later found that the approach they’d chosen didn’t fit so well any more. What changed? What did you do about it?

Do you have any stories to share about developing a lifestyle business in general? How do you generate ideas?

How about any constructive criticism of my idea generation and filtering process?

Don’t be shy! Please leave a comment.


I’d like to give you access to my FREE comprehensive 6-part email course which will show you the exact steps I took to quit the rat race in 18 months. Just enter your email address below.


[Image “Cartoon Character Hamster Exercise” courtesy of saphatthachat at]

12 thoughts on “How to build job-free income streams which suit your life

  1. Brilliant stuff Andy! Well, to be honest, it’s not really is it. What you have so eloquently presented is common sense that anyone considering starting a small business should know and understand off by heart.

    I am looking forward to reading more as I am very much in a similar position. Recent retired early and looking for a fulfilling way to run a small business that makes a few bucks for my beer money. Or hopefully a few more than that.

    The list of questions you recommend one asks before going forward is spot on. Cheers for the post.

    1. Thanks Martin.

      Although I agree that most of these things are common sense, I’ve made many of the mistakes myself in the past (particularly being ‘free’ to be busy all the time as a self-employed person!)

      I’m glad it was useful.

  2. Very interesting post and one of the more useful examples of Venn diagrams since I learned about them here:
    It’s too late for me now, but I believe your coaching and blogging can add value for the younger FI/RE folks out there (those in their 40s and 50s.) I know Ermine has found your postings very useful in his thought process.

    1. Cheers Ray.

      As you may have noticed, I like my Venn diagrams. I suppose it comes from doing a lot of digital electronics/programming and hence formal logic on a daily basis.

      Thank you for the blog/coaching endorsement. The 30s-50s crowd are really the ones I’m trying to help most as they don’t have quite the same options for serious frugality that the really young ones (22 year olds with no kids and good salaries) do.

  3. Apologies in advance – my inner scientist coming to the fore.
    I’m trying to wrap my head around “the box” graphic. Forgive me if I’m being naive, but are there any variables associated with the vertical and horizontal axes? In plain simple english, taking your first graphic, why is ‘freelance engineer’ above the (blue) box, and ‘private tutor’ below the box. I’m guessing that the vertical axis may have something to do with financial recompense. Or am I overly analysing a graphic that is merely intended to show that both are “outside the box”, and otherwise their relative positions are of no consequence?

    1. On reflection, I think the latter applies, although I could always apply my imagination to what variables might apply to outside the box LOL 😀

      1. Hi Felice.

        I’m afraid you’re right. The picture just wasn’t that clever!

        My main aim was to show that even though you might have put a lot of effort in to thinking outside the original box of having a job, you still have to be very vigilant to unchecked assumptions (i.e. you are not outside all boxes.

        Thanks for your comment and what I think was a good criticism of my scribbles!

    1. Hey Mrs E.

      Thanks for the comment. I’ve read and digested your post so I’ve replied in detail over on your blog.

      I’d encourage everybody else to check it out as it’s very interesting!

  4. Great website and fascinating article, thanks! I went freelance two years ago but, interestingly, I have now got a portfolio of part time employed jobs as well as freelance contractor work and a new small business. What I need to do next is to plan how to scale down and keep what is most fulfilling whilst getting some time back for myself and moving towards financial independence.

    Does having several very part time employed jobs count as being ‘independent’ – the answer is ‘no’ I guess?

    1. Hi Mark.

      Thanks for your comment and kind words.

      I think that trying to fit your situation inside a label like ‘independent’ is unnecessary. If what you have allows you to live the life you want, then why would you change it? On the other hand, if you have to sacrifice good things in order to keep things which don’t really mean that much to you, then that might be a bit of a bad bargain.

      In my view, it’s important to distinguish between ‘means’ and ‘ends’. For example, it was never my end goal to live without a job. Living without a job allows me to achieve things which are my end goals such as living healthily and pursuing further academic study.

      So in summary, if you have several part-time employed jobs and are getting what you want out of life, I’d say ‘congratulations on building a life that suits you!’ On the other hand, if you have more than enough income and plenty of cash, then start culling the income streams that you don’t want any more. Striving for early FI, is (in my opinion) usually a waste of time if you already have flexibility. YMMV though.

      As a matter of interest, have you come across the book Unjobbing by Michael Fogler (disclosure: affiliate link)? Fogler has lived on a patchwork of various little jobs and projects for much of his life. Perhaps reading what he has to say might help you with your strategy.

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