There are hundreds of ways to make money online, but they each generally fall into one of the four basic approaches outlined below. In our own business, my wife and I have had the best luck with the last two, but each of us is different, and each of these approaches to making money has its advantages and disadvantages. Here’s is a quick look at those plusses and minuses.

Employee

If you can write, there is always a chance that you can get hired by a company that needs constant new content for their websites. You might also be hired as programmer or web-designer. You could be in customer service and still operate from home as well. There are many different potential jobs that allow you to work online.

When you make money online as an employee, you get a regular paycheck - the primary advantage to this approach. The disadvantages are all the same ones as those of being an employee offline. Your pay is ultimately limited, you probably won’t get to set your own schedule, and you never know when you might lose your job.

Independent Contractor

If you have the skills to work online, you don’t need to be hired as an employee. You can sell your services on sites like Elance.com, and others where businesses post projects they need done and anyone can offer to do them for a price that is acceptable to both parties. For example, I recently hired a American living in Malaysia to write a hundred one-paragraph blog posts for me.

That example demonstrates one of the advantages of making money online in this way. You can do it from anywhere. You also get to choose when you want to work, and not just what time of the day. If you want a week off, you just don’t offer to do any work that week. In other words you have a lot more freedom than an employee has. Disadvantages? You are competing globally, so you may not make any more income than an employee, and your income will be unpredictable as well, based on what’s available.

In Business With Customers

You can make money online just like it is made offline. I know people who sell camera equipment and laminating machines online, for example. Almost anything can be sold on the internet. You can sell services as well, such as web design or copywriting. You can also combine an offline and online model in many businesses.

The advantages of selling goods or services online are that you can start small and at home in many cases, thus allowing you some more freedom and less risk. One disadvantage to selling and shipping things is that you have to be at work to do that, unless you grow large enough and have profit margins that allow you to hire an order fulfillment company. Even in the case of services that are provided over the internet. You have to check email daily and deal with customers.

In Business Without Customers

Of course all businesses have customers, but that doesn’t always mean the same thing when you make money online. For example, you can create a website writing about exercise or dog training, and post ads for which you are paid for each click. In these cases the pay-per-click advertiser is your customer, but it really isn’t like having a customer on the phone or across the counter. Having placed ads on our sites five years ago, we still have never had to talk to the advertisers. We just copy and paste the ads. The phone never rings, and occasional emails have never been urgent.

The obvious advantage of this method is that you can make money from anywhere, and without having to even check email daily. Make money online in this way and you have the most freedom you can have in a business. The disadvantages? Despite the freedom to choose your hours, you will probably have to work harder than ever to build profitable websites in today’s competitive internet environment.