One of the most popular ways to develop an additional stream of income is to use a specialized skill that you may already possess (or can pick up through training), and use that to get and complete well-defined pieces of work. Good examples are resume writing, bookkeeping, web-site building and so forth.

Step 1 of 5: Hone your specialized skill and your target market.

If you have a specific skill that you can use, such as,:

• Administrative assistant type work (organizing files, scheduling calendars)
• Ability to write well (help with book writing, ghost writing articles )
• Accounting (bookkeeping)
• Copywriting (writing advertisements, web-site copy, press releases)

you can use that skill to take on specific jobs and deliver on them and get paid for the job. Specific task oriented work, as opposed to an actual part-time employment allows you to be flexible with your work-schedule and lets you control your work-load much better. Of course the downside risk is that you have to do the leg-work of finding assignments. But advertising in the right places may actually make that simpler. If you believe you do not possess a financially valuable skill, it may be a good idea to seek out training first to achieve a degree of competency in that area. Community colleges, specialized training institutions, as well as the Internet are good places to seek out such training. Following the training, volunteer to do work in multiple places and get some experience under your belt. Once you are ready, start looking for paid engagements.

Step 2 of 5: Look for a gig at the right places

Once you are ready, you can bid for jobs on web-sites like elance.com, where you can look for posted jobs and bid for them, or simply advertise your skills for interested businesses. For writing gigs, look at freelancewriting.com, where you can talk directly with the job posters and negotiate your rates. Advertise locally in sites like craigslist.org, and Yahoo! Local Business Directory. The Yellow Pages is another good option, though somewhat more expensive. Always track the response from your advertisements so that you know what works and what does not. You must track the channel (where you advertised), the actual ad copy, the position of your advertisement, your costs, and the ultimate results. When you find a channel that works optimally for you (returns cover your income needs and cost of advertising), focus all your resources on that medium of advertising until results are where you would like them to be. Yes, one way or the other  you are in your own business now!

Step 3 of 5: How much should I charge?

This is a crucial step in bidding for work, or in accepting free-lance work. There is a tendency for many individuals starting out for the first time to attempt to underbid to get a contract. Especially their first contract. Resist this tendency. Find out the market rates commensurate with your overall experience. Take into account your experience not only in your specific skill area, but also overall. For example, an individual who is 1 year out of college, with bookkeeping experience of 6 months should be paid less than another individual with 10 years of work-experience, but only 6 months of bookkeeping experience. So carefully walk through the market rates for services such as yours, and make your offer at about the middle of the market rates for your services.

Distinguishing your services from those of your competition should be based on either some additional service that you offer, or some guarantee of quality, or a money-back guarantee -but not on price. If you price yourself too low, you will convey a message of inadequacy, too high may price you right out of the market.

Begin thinking in terms of what would cause the client to pay top dollar for your service? And check if you can deliver that level of service? Then step down from that level and price yourself accordingly.

Step 4 of 5: Develop a Plan for executing the job

All right, so you have some interested customers. They like your rates, and would like to know a completion date, and an estimate for the final work. Your ability to estimate the right amount of time to complete the job, along with the number of hours you will charge for the work is important, and will directly determine your long term success in the marketplace. A piece of work completed accurately, on-time, and under-budget will fetch you referrals, establish your credibility, and will ensure an extra stream of income for many years to come.

Develop a plan for executing jobs - walking through some mock assignments (based on your prior experience), adding plenty of extra time to allow for re-checking of your work, including time for talking with the customer (if needed) to understand the job and for gathering any required information.

At the end, do the job the way you would want someone else to do something for you!

Step 5 of 5: Deliver and Get Paid!

Once the task is complete, deliver the work in the fashion previously agreed upon. Have multiple ways to contact the customer, and always track the delivery of your work. Ensure that a completion of job signature is obtained from the customer. This makes you eligible to collect payment for the services rendered.

Make sure you have multiple ways to take payment - cash, check, credit cards. For your first few jobs, it may be easier to stick with cash and check, but it might be even simpler to go through a third-party who will handle the payments for you.

Finally, should you incorporate yourself before using this method to develop a side income? It may be worth your trouble to do so. If your customers are folks you end up meeting face to face, and you get your payments mostly as cash or check, and the level of liability in your work is limited, you could live without it. But given the overall simplicity of getting incorporated, our recommendation would be to do so.

And while at it, record your processes - i.e. how you execute your business? This will be useful in keeping yourself in line and also in expanding and building a successful business from this source of extra income.

If you already are in possession of a specialized skill, it is time to use it and get that extra income going right away!