Ranked: The 3 Most Cost-Effective Types of Businesses to Start

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I've worked as an independent contractor for more than 10 years, so I know how important it is to keep costs low when starting a business. As a freelancer, I'm fortunate to have minimal expenses associated with my work. Many businesses are in the same boat. It's easier than ever to launch a new business and keep costs down, depending on which business you launch.

Here are three of the most-cost effective businesses to start and how much you could make from each.

1. Content creation

Start-up cost: $0

Average annual pay: $116,615

I'll start with what I know best: creating content. I left my full-time job more than 12 years ago, and freelance writing has been my main source of income since then. With this line of work, you may be writing and editing articles and blog posts, creating marketing materials, or updating website content.

It hasn't always been easy, but one of the things that made it less nerve-racking when I began is that my expenses are very low. Every four or five years, I buy a new computer, and I pay for one or two software services to check my grammar and help me organize my work.

But if you own a computer, you could start a content creation job with little or no start-up costs. Finding freelance content jobs on sites like Fiverr is free, though you'll pay a fee when you complete a job and are paid.

2. Social media management

Start-up cost: $0

Average annual pay: $64,845

This job is in the same vein as content creation, but there's more responsibility involved. I've done this, too, and can attest that it also can have low start-up costs.

One difference is that social media managers often create marketing plans and calendars for the content they're creating. They may also get paid to assess a business' current social media strategy and suggest changes. I recently worked with a company that asked me to look at its current posts, create online materials for an event, and make a promotional video for a conference it was hosting.

You don't need any special software to be a social media manager, so the start-up costs can be as low as $0. But once you have a handful of clients, you may want to pay for social media management software, like Hootsuite, which starts at $1,188 annually.

3. Bookkeeping

Start-up cost: $1,347

Average annual pay: $50,573

Accounting jobs are in high demand right now, making this a particularly useful job. You don't need to be a certified public accountant either. Many bookkeepers are good with numbers and a knack for using accounting software.

There are more than 33 million small businesses in the U.S., and many could benefit from freelance bookkeepers to keep track of their finances. If you want to stand out among others in the field or need to brush up on your skills, you can take a bookkeeping course. The National Association of Certified Public Bookkeepers has an online class to become a licensed and certified bookkeeping professional for $1,347.

Consider upskilling before starting a new business

If you're interested in starting a new business but aren't sure where to start, building new skills could be a great first step. Platforms like MasterClass and Skillshare can introduce you to new skills and build on existing ones.

This upskilling pays dividends, even if you don't use it to start a new business. Gallup data shows workers who upskill get paid 8.6% more on average.

There are plenty of other low-cost businesses to start that aren't on this list. But the in-demand small businesses I discussed here can be launched relatively quickly and with little out-of-pocket expense. This is a great combination if you're looking for a career change or want to launch a side hustle.

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