Probably the most scammed and written about topic is the allure of making money from the comfort of your home using nothing but the internet to do so. So what’s the answer, can you really make money from home or is it just a pipe dream?

Short answer: yes you can.

Long answer: you can, provided you find legitimate sources to work with.

Detailed answer: I’m going to list here in this post, and in general in this entire site, legitimate ways that you can work from home and support yourself and your family. How can I say this with such surety? Because I’m doing it. I work from home and that’s how my spouse and I run a 2-income household. But I’m going to be talking exclusively about online work (as opposed to setting up a home business) and most of the items on my list do not fall into the job category but really the career category. I’m going to show you ways to build an online business and a career while working from home.

A word of caution before I provide the list.

There is no easy, quick and effortless way to make money online. And anyone who tells you that is a liar and a scammer. Making money online is almost exactly the same as making money in a regular brick and mortar world; it takes hard work, dedication, perseverance and smarts. But once you get the ball rolling, the internet allows you to make money with many different kinds of income streams (which is not possible in a 9-5 job). Some of these streams can even be residual in nature, meaning that you earn while you’re not actively working (but you’d have already put in the hard work to set it up).

Oh and another quick word: the list I’m going to show you can work anywhere in the world. That’s right you don’t have to worry about which country you reside in. So long as you have a computer and an internet connection, you’re good to go in the online world.

Right so let’s get to the list of ways in which you can make money and build your online business:

1. Freelance Bidding Sites

Bidding sites such as Elance, Guru, oDesk, ScriptLance, Get-A-Freelancer, Rent-A-Coder etc all function in basically the same way. Think of them as auction houses; they bring together buyers (companies or individuals) who have work to outsource and providers (like you) who are looking for work in their specialized field. Bidding sites are the middlemen in this exchange; they will hold the money in escrow, they will provide a place for the buyers and providers to talk shop, upload files, negotiate disputes and conduct their business by providing some level of confidentiality and security.

Bidding sites are called that because again, like an auction house, you must place a bid to be considered for a project. The buyer selects the winning bid and work commences.

Some bidding sites cater to one specialized category while others offer work opportunities in several different fields such as graphic design, web development, web design, content development, engineering, finance, law, sales and marketing, etc.

Some sites offer a free membership with limited views or limited access to projects, while others don’t have any free option. Most offer membership categories, which can start from $10 – $20 per month. You use your credit card (or PayPal account if you have one) to buy a membership.

The money you earn is usually deposited directly in your bank account (via SWIFT code for international transfers). Or again if you have a PayPal account, you can choose to have the money sent to that account. Once the system is set up, bank transfers can take as long as a week or be as quick as 24 hours, depending on where in the world you live.

Since I work mainly on Elance, I’m going to be sharing many of my Elance experiences with you here. You can start by reading the 7 Secrets for Elance Success.

2. Content Sites

Examples of content sites are Suite101, eHow, Helium, Associated Content, About, Examiner, Constant Content, and many more!

These sites usually incorporate either in part or in full the concept of residual income. They are sites which hire freelance writers to create content for them. Writers get paid either upfront for each article, according to the page views their article receives or according to a revenue ad-share program. The ad-share program basically displays relevant ads to your article. When a reader clicks on an ad, you get paid a percentage of what the advertiser is paying to have his ad displayed on the site.

This type of earning is usually a slow trickle in the beginning but it can really add up with some time investment and learning the tricks of writing for the web to generate maximum revenue.

Payment is usually made via PayPal. If you’re in a country where PayPal doesn’t operate, you can look into options of having someone trusted in a PayPal-approved country set up an account for you, using your email address so you get all the notifications, etc.

Since I work mainly for Suite101 from the above list, I’m going to be sharing my experiences writing for them and will detail all the pros and cons for you.

Content sites can exist in areas other than writing too; for example, photography sites which pool together photos taken by different photographers and offer them as stock images work on the same principles as the writing sites mentioned above.

3. Blogging

To be a successful money-making blogger, you must own your own domain name website. No ifs and buts to this rule! Don’t think you can successfully monetize your blog using a free site such as Blogger.com or Wordpress.com (see this post for the distinction between wordpress.com and wordpress.org). While you can earn some moderate amount from free sites which allow ads to be displayed (such as Blogger now does), there are limits to your earning potential.

To make money as a blogger, you need to be operating in a niche market that you are familiar with and can offer unique insights on. You will earn money mostly through online ads, your own product sales (such as an e-book), your own membership sites and anything else that you can successfully monetize.

This route to online riches is anything but easy and obstacle-free. The amount of discipline required is immense since no one is driving you to work hard (or work at all), and the pressure to drive traffic to your site (so people can click on your ads or buy your stuff) is pretty intense. You’ve got to know or learn about search engine optimization (SEO) and how to rank highly so that people interested in reading what you’re offering will find your site. You’ve also got be a master promoter and learn a bit of marketing since you’ll mostly be doing it all yourself.

Successful bloggers, like Darren Rowse or Brian Clark, who make a living via blogging have been at it for years and are only now reaping the rewards of their hard work. It would be a good idea to study them and their blogs, read what they have to offer, and soak up all the useful advice and tips presented on their blogs.

4. Affiliate Marketing

Affiliate marketing works on the same concept as a referral program. In the brick and mortar world, you can earn a commission based on recommendations. In the online world, you can earn commissions based on directing traffic and sales to the company or product you choose to affiliate yourself with.

Here’s an example: suppose I really liked a book I read recently and thought it would help my readers in setting up their online business. I would go to where this book was being sold and become an affiliate for it. Once approved, I’ll write an honest review of the book containing both its benefits and any criticisms. In the review I will place my affiliate link. When someone clicks on my affiliate link and buys the book based on my recommendation, I get a percentage commission of the sale.

Affiliate marketing can be incorporated into your online business ideas in 2 ways: either via blogging where you place your affiliate links in your blog posts, or via a dedicated product review website which reviews affiliate products.

These were the big 4 ways in which to start making money and building an online business right now. Obviously there are many smaller schemes and many sub-schemes within these niche areas, but if you can master even one or two of the above, you’re off to a great start! And remember it’s never a good idea to keep all your eggs in one basket, so as soon as you’re comfortable with one money-making idea, start exploring how you can use the others.

Got a tip you want to share about making money online the legitimate way? Have a question about any of the freelance sites outlined above? Want to add your own success story to building an online business? Drop me a line (or several lines) below!