Avoid the 'Perfect Idea' Trap

If you're like me, sometimes feel like you're just not sure where to get started; or you have so many ideas of potential ways to earn money that it can be overwhelming to choose just one. We deliberate, debate and try to decide which is the right idea to pursue until we are paralyzed by all the choices we've given ourselves, and end up doing nothing.

If you've made it this far, you already know that you're ready to earn more money. That's great -- that's a bigger step than most ordinary people will take in a long time. The next step is where most people -- even the highly motivated ones -- get stuck. What will you DO to earn more money? What skills do you already have, and how can you translate those into money?

"But I can't start until I've finalized my idea!" Wrong.

You don't have to have that the 'perfect' idea to start earning money on the side.

This is one of the most enraging misconceptions because it stops most people in their tracks. When people tell themselves the 'perfect' freelance idea is some magnificent destination that you have to arrive at -- instead of a systematic process for earning more money -- then it's easy to rationalize doing nothing at all. "Oh, it's impossible." "It's too far off." "It's not for me."

Here's the hard truth: Your idea is a lot less important than you think it is, and here's why.

The true value of your idea comes to life when you execute.

Have you ever heard anyone say "Man, if only I had been the one to come up with that Google idea, I'd be one of those billionaire guys by now!" Uh. Think again. Your idea is just a meaningless thought until you can bring it to life with impeccable execution.

Likewise, even a highly imperfect idea can yield profitable and satisfying results with great execution.

Here's a step-by-step process for selecting the ideas that work best for you and then match what you've got against the real world, also known as your market.

Step No. 1: Define Your Skills

Start by writing down all of your skills. Only give yourself five minutes. Skills are things like photography, html code, writing, driving, etc. You don't have to be "the world's greatest...", just decent at it.

Step No. 2: Define Your Strengths

A close friend, coworker or family member can be a huge help in defining your strengths, so you may want to call someone up to get some feedback for this one. Write down all the strengths you know you have. Strengths can be "good at negotiating," "personable" or "decisive."

Step No. 3: Find Your Interests

Write down everything you are interested in. If you are stuck, think about the types of things you do on your day off. Think about the blogs or websites you visit. When you find yourself with an hour of time, how do you spend it?

Step No. 4: Put it all together

Take your three lists, and look for intersections. Can you find a common thread? Write down three potential services you could offer based on your lists. Keep in mind that it you don't always have to incorporate all three categories.

Step No. 5: Find Your Market

Research your ideas. Do keyword searches on Google and Craigslist to see what comes up. Is anyone currently offering what you might offer? That's a good thing.

Transforming skills-strengths-interests into viable business ideas

Now lets look at two real world examples of what to watch out for when crafting your idea.

Example No. 1: Test the Waters Before Jumping In
Matt loves dogs, wanted freedom and decided to try running his own business bringing these two interests together. He ended up going with the idea of a dog sitting business.

At the beginning, Matt had a great time -- taking care of dogs, getting some extra income, and doing preliminary marketing for his services. But a couple of things started closing in on him, all having to do with execution. For example, Matt didn't realize that he would also become the Chief Financial Officer, the counselor, the customer service rep, the cashier, etc., and bad stuff started to happen. If he had tested the model by starting out freelancing instead of jumping right into forming an S-Corp, getting a bad business partner, taking out loans, etc. he would have realized that this wasn't a very good fit.

Lesson: Start small, get a few customers and test the waters. It's low risk and high reward.

Example No. 2: Where's the Viable Market?
April loves yoga and loves writing. Naturally, she figured she'd simply put the two together and dollars would start raining from the sky. Copywriting and newsletters for yoga studios -- perfect, right? Do yoga studios even need newsletters and copywriting? If they think they need it, do the really need it  enough that they're willing to pay for it?

April ended up doubling her income AND quitting her suffocating 9-to-5 job to go freelance full-time. But she didn't get these results by copywriting newsletters for yoga studios. She nailed down her skills, strengths and interests and perfected the critical last ingredient -- identifying and testing a paying market. While she didn’t end up writing for yoga studies, she found another market willing and able to pay for her services.

Lesson: The trick is not just to get started, but to start on the "right" thing. This will help you discover what the "right" thing for you is.

Ramit Sethi runs a blog on personal finance tips where he covers automation, psychology, and earning more.

About Ramit Sethi

Ramit Sethi, the New York Times best-selling author of I Will Teach You To Be Rich, shows regular people how to live a rich life by spending extravagantly on the things they love -- and cutting costs mercilessly on the things they don't.

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