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Mystery shopping - Is it a legit way to earn extra cash?

If you have to hustle in the gig economy, mystery shopping is one of the best ways to earn extra cash.

Simply head to a store, take good notes about customer service, and file a report - voilà! Easy money.

While many companies have slowed down in their hunt for diligent mystery shoppers since the recession, there’s still plenty of money to made taking on these gigs.

But beware: some mystery shopping requests are scams, out to short-change hard workers like you.

Here’s everything you need to know to make money as a mystery shopper - without getting the wool pulled over your eyes:

Mystery Shopping is Big Business

While mystery shopping might seem, well, mysterious, that’s only because mystery shoppers have to exercise discretion in order to be effective.

According to Mike Mershimer, the president of the Mystery Shopping Providers Association (MSPA Americas), company-fueled mystery shopper programs are actually big business.

“There are millions of people around the country that do various types of mystery shopping,” Mershimer told Time.

That’s because mystery shoppers provide companies with valuable insights about their customer service in brick-and-mortar stores, although most shoppers only get paid between $5-$20 per shop.

The low wages are something you should think about before getting started, an anonymous mystery shopper explained to Forbes, since mystery shopping is most often used to supplement a full-time job.

“Most shops paid me $7 to $15, so a $7 shop fee (plus the reimbursement for the meal) equaled about 10% of what I was making at my "real" job,” the shopper revealed.

And don’t be surprised if you have to take multiple low-paying gigs before you’re bumped up to mystery shops that pay more. According to personal finance expert Donna Freedman, this is relatively common within the industry.

“First, you need to take the lower-paying gigs and prove yourself to be reliable,” Freedman told Time.

“If you do it wrong or even skip a few steps, you might not get paid for the shop and you probably won’t be given other jobs.”

Still, if you’re smart about how you shop and are a good communicator, you can earn major money, another mystery shopper explained to The Guardian. It’s just a lot of work.

"There's lots to remember, and sometimes it can detract from the experience,” the mystery shopper, Hannah, said.

“You're expected to give feedback while it's fresh, so I've had to get up at 5 a.m. to write a report before work. It's a challenging thing to do; you need to be focused, articulate and detail-orientated."

According to Tory Johnson, a workplace contributor for ABC News, Hannah’s observations are absolutely spot-on.

“Most companies critique your online application for proper spelling, grammar and punctuation, especially since your proof-of-completion reports are submitted in writing to the client,” Johnson writes. “Poor spelling will knock you out of the running.”

Still, if the assignments fit into your normal lifestyle, it can be a reliable - and perfect - way to earn extra money to pay off student loans or save up for a big purchase.

Do Your Research

The best way to find well-paying mystery shopping gigs - from legit companies - is to do your research on the job boards.

Top industry sources for work include MSPA Americas, as well as reputable companies like Bestmark and AboutFace.

"The MSPA is like the [Better Business Bureau] of Mystery Shopping," Sarah Goshman, who serves as quality control senior editor for AboutFace, explained to Bankrate.com.

"Not all of the legitimate shopping companies are listed there, but most are. They also offer two levels of certification for shoppers," she added.

Most legitimate companies will also have online reviews from other shoppers, which you should take into account as you browse for work.

“For mystery shopping, I make sure that there are real reviews from other users,” Michelle Schroeder-Gardner, the publisher behind MakingSenseofCents.com, told Time.

Make sure you know who you’re getting into business with - and whether other shoppers have been happy with treatment and payment.

A Good Gig for Disabled Workers

If you’ve recently had to go on disability because of a work-related injury, mystery shopping might be a relatively painless way to make supplemental income as you heal.

Plus, as financial reporter Martha White points out, companies are actively looking for feedback from customers with disabilities.

“Some companies use mystery shoppers to check up on the quality of their customer service call centers,” White writes, while “others use shoppers with disabilities to see if their stores, restaurants, hotels or other facilities are meeting ADA compliance.”

Improve accessibility and earn a supplemental income? Yes, please.

Cover Your Expenses - And Plan for Taxes

Interested in becoming a mystery shopper? First, make sure you don’t have problems with cash flow, since mystery shoppers regularly must cover expenses before being reimbursed.

"We have done mystery shops in every kind of restaurant from fast food to fine dining, where the reimbursement and fee are as much as $200," Cathy Stucker, author of The Mystery Shopper’s Manual, told Bankrate.com.

While most companies will reimburse you for shopping expenses, the checks can take at least a month to arrive. If you don’t have a regular income, handling these kinds of expenses can be difficult to manage.

And when you do get paid, remember that you’re receiving taxable income, says Stucker.

“When mystery shopping, you will most often work as an independent contractor,” writes Stucker at her website, MysteryShoppersManual.com.

“That means that the companies paying you don’t withhold income taxes, Social Security taxes or Medicare taxes. You are responsible for making sure your taxes are paid.”

Putting aside 25-30% of your earnings from mystery shopping - especially if you’ve earned more than $600 from a single company in a year - should be enough to save you an unpleasant surprise at your accountant’s office in April.

Watch for Red Flags

As with any niche industry, there are plenty of scammers out there who want to profit off of your hard work.

These red flags should make you run the other way:

  • Receiving a shopping opportunity out of the blue. Typically, mystery shoppers fill out applications with specific companies, like Bestmark and AboutFace. Only once their applications are processed, and they’re onboarded by a company, will mystery shoppers accept a job. If someone contacts you about a mystery shopping gig, your spidey senses should tingle. Research the company on the MSPA boards to see if they’re legit.
  • Prepaid offers. Some of the most common scams involve prepaid offers or convoluted requests for money. "No one should ever cash a check and wire money to someone they do not know for any reason," Stucker explained to Bankrate.com. "When someone asks you to cash a check and wire some of the money to them it is a scam. Always. There is no mystery shopping company that will ever ask you to do this."
  • Application fees. Applying to work for a mystery shopping company - just like applying for any job - is free. A company - or scammer - that asks you to shell out money to join their organization is usually up to no good.
  • Phishing emails. Remember those unexpected mystery shopping opportunities we mentioned above? Sometimes they come in the form of suspicious-looking emails that request personal information. If you get an email like this, mark it as SPAM immediately - and don’t click on any of the links.

While it may take you some time and effort as a newbie mystery shopper to receive high-paying assignments, it’s a good way to make extra cash.

If you’re detail-oriented, good at juggling multiple assignments, and a strong writer, you could easily make $500 to $1,000 extra dollars per month.

Goodbye, student loans! Hello, new car.

Images: Pexels, Pexels, Pexels, Pexels

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