Is AirBnb a good side hustle?
<div class="user-question">What are the best investment vehicles for someone who doesn’t make that much money? Stocks or Real Estate (like Airbnbs that I could run myself)?</div>
AirBnb seems like an exciting investment, but it's basically a job you paid $60,000 to give yourself.
No one on the internet talks about this, but the most boring investments are almost always the best investments - and they get even better with time (and compound interest).
Nothing about an S&P index fund is interesting. Nobody's making a reel about how they set up an automatic $200 transfer bi-weekly and then didn't look at it for 20 years before becoming a millionaire. And that's exactly why it works, because the entire return comes from long term consistency and minimal risk.
Meanwhile everything that sounds exciting - the AirBnbs, the flip, the new trends on TikTok - tend to be exciting because of risk. Excitement in finance is usually just volatility.
And while we're being honest: the AirBnb wave has come and gone. 2016 to 2021 was the window, but unfortunately most of that market is saturated now. Occupancy is down across most major markets, nightly rates have gone down, and cities have spent the last three years actively legislating against it.
But still with all that said, the question that keeps showing up in my DMs the most is: "I don't make that much money yet. Should I start with stocks, or should I buy a small place and run it as an airbnb myself?"
I love this question though because the person asking it is already ahead of most people. They're thinking about ownership. They're thinking about assets. They've figured out the thing it took me until my mid-twenties to understand, which is that a paycheck is not a plan.
My answer? Start with the boring investments first.
If you're earning modestly and want to start today, here's the sequence I suggest:
1️⃣ Your 401k up to the full employer match
If your company matches, that is an immediate 100% return on your money. There is no real estate deal on earth, in any market, at any point in history, that reliably pays you 100% on day one. People skip this and then go looking for "high returns." This is the high return yall!!!!
2️⃣ Max out your HSA
This is the most slept-on account in personal finance and it is genuinely the best tax-advantaged vehicle in the American financial system.
→ Money goes in pre-tax. It lowers your taxable income the same way a traditional 401k does.
→ It grows tax-free. You can invest it, put it in index funds and let it compound for 30 years TAX FREE.
→ It comes out tax-free for qualified medical expenses and there's no time limit on reimbursement. If you pay a $600 medical bill out of pocket today and keep the receipt, you can reimburse yourself from your HSA in 2050 - after that money has been invested and growing untouched for 25 years. Just save every medical receipt in case you're audited!
A 401k taxes you on the way out. A Roth taxes you on the way in. The HSA does neither. It's the only account in the tax code that lets you skip both ends.
The 2026 limits are $4,400 for self-only coverage and $8,750 for family. You have to be enrolled in a qualifying high-deductible health plan to contribute, which is the catch - if you're young and generally healthy, the HDHP is often the cheaper premium anyway, so you're getting a lower monthly cost and access to the best account available.
Then at 65 it becomes even more flexible: you can pull the money out for anything at all, and it's just taxed as ordinary income, exactly like a traditional IRA. So the worst case scenario for an HSA is that it performs like a normal retirement account. The best case is that it's completely tax-free money.
3️⃣ A Roth IRA
The 2026 limit is $7,500.
This is the most underrated account for anyone early in their earnings. You contribute after-tax dollars and everything it grows into comes out tax-free in retirement. Which means the lower your income is right now, the more valuable a Roth is, because you're paying tax at the lowest rate you'll probably ever will. "I don't make enough for a Roth" is backwards. Not making much is precisely the condition under which it works best.
4️⃣ A low-cost total market or S&P 500 index fund, automated every paycheck
The automation matters more than the amount. $50 a paycheck that you never have to think about beats $500 you fully intend to invest and don't. My favorite saying is set it, and forget it!
5️⃣ If you want real estate exposure with no capital, look at REITs index
You get diversified property exposure without the headaches of dealing with tenants or dropping a large down payment to purchase a house.
Found this valuable? Here are some more deep dives from the Frich team 🤝
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✅ How do I actually build wealth in my 20s?
Boring and consistent beats exciting and viral every.single.time
I'm not a financial advisor and this isn't personalized financial advice. It's what I'd tell my little sister, and roughly what I do myself. Your situation is yours - talk to a fiduciary before you make a big move. NFA. DYOR.
Kristina
