How Retirees Can Earn Money From the 'Sharing Economy'
Tips for raking in income by renting out everything from a spare room to tools
You’ve most likely seen news stories about the “sharing economy,” with seemingly every blogger and op-ed columnist offering a take on its significance. What you may not realize is that getting paid to share what you own or can do is a great way to supplement your income if you’re retired.
In fact, it’s easy for a retiree with some free time and a few underused assets to earn $1,000 or more a month by taking advantage of websites and apps (known as marketplaces) that facilitate renting our stuff to others, from cars to spare rooms to lawn mowers.
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Two popular examples: the Airbnb site (which connects people looking for a place to stay with those who can accommodate them) and the Sidecar app (where you get paid a “voluntary donation” by someone who signs up to share a ride in your car; the service is currently available in Boston, Chicago, Los Angeles, San Francisco, Seattle and Washington, D.C.).
Generally, stories about the sharing economy focus on Millennials and Gen X’ers who are raking in sorely needed extra cash this way. But retirees are also starting to join in for three reasons:
They’ve become far more comfortable with online services. According to the Pew Internet and American Life project, more than 58 percent of people over 65 are now actively using the Internet, up from only 18 percent 10 years ago. The Internet makes the shared economy possible by allowing strangers to find — and more importantly, trust — sharing counterparts.
Times are tight for many retirees. Some haven’t saved enough; others retired sooner than they’d expected due to poor health or a layoff. Their money needs to last longer than they had anticipated.
Sharing can offer enjoyable social interactions. When you invite someone to spend time in your home or car, for instance, you have a chance to connect with new people from diverse backgrounds. Many Airbnb hosts report making long-term friendships with folks who’ve rented rooms in their homes.
A 4-Step Plan for Retirees
So how can retirees share in the financial opportunities of the shared economy? My Guide Financial colleagues and I recommend this four-step plan:
1. Figure out what you have to offer and then visit the sites and apps to earn money from sharing. The Uniiverse website offers a comprehensive “social marketplace for real life experiences” and can be a good place to start. The sharing economy directory, Mesh, offers a great rundown of useful sites.
(MORE: Boomer Travel Trend: Couchsurfing for Grownups)
Here are some specific types of sharing possibilities and the sites and apps catering to them:
2. Determine whether the effort will be worth it. Earning income through the sharing economy requires time, work and planning.
Below are seven examples of how much you might earn renting out particular goods or services for a certain number of hours, days or nights through well-known sharing sites. As you’ll see, if you have all of these things and time to run a few errands and teach, you can probably make at least $1,800 a month.
3. Sign on and get started. Most online sharing-economy marketplaces and apps make it easy to begin participating; they want as many people as possible because the firms earn money from every transaction.
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Here’s how it would work at Uniiverse.com, for example:
After registering, you describe what you are offering, where you’re located and how people can contact you. Your listing then goes up on a menu at the site (see below). Interested Uniiverse users click on your listing, setting a time to use the product or service; you can check out their profiles and decide whether to approve them. If both sides of the transaction are onboard, the person who wants what you have pays Univverse with a credit card; if you’re loaning something out, he or she must make a deposit. After Uniiverse takes its cut, the site transfers money to you.
4. Make the most out of the experience. There are a few things you can do to help ensure your transaction works out well:
Before signing up for a sharing economy site or app, understand your potential liability. Most of these marketplaces insure you against accidents, theft and losses; Airbnb and Relayrides offer $1 million insurance policies against home and vehicle damages, for example. But liability rules vary, so read them before you enroll.
You should also check with your municipality to be sure that earning money from sharing is allowed. And if you’re a renter and are considering earning money from guests, find out if your landlord is agreeable.
Don’t accept a prospective client until you’ve checked him or her out carefully. Typically, each person applying to use what you’re renting must include background information such as a profile, recommendations and identity confirmation through social media.
You should also work on building a stellar profile that’ll help you attract customers. Remember, they’ll be checking out who you are, along with your track record sharing goods and services. Take time to show them why you’re trustworthy and have something great to offer.
Finally, treat your customers well. That’ll lead to good reviews and ultimately, more customers and more money. Fun fact: Airbnb hosts over 55 have typically received much better reviews than younger ones.
Happy, lucrative sharing.