If you’re feeling the money crunch in your personal finances, you’re not alone. Millions of people turn to alternative sources of income, called side hustles, to help them with everything from their monthly Starbucks budget to creating multiple streams of passive income on the way to financial freedom.
According to CNN Money more than 44 million Americans are side hustling, and 36 percent of those bring home over $500 a month. That’s a lot of lattes. And don’t be fooled by the name—while over half of millennials are hustling, 24 percent of baby boomers are too. No matter your age or phase in life, everyone could do with a little extra scratch. The right side hustle can keep you well into the black, even through life or job changes.
First things first—what do you want to do as your side hustle? Are you looking for a job that offers you the freedom to make cash whenever and wherever you want, like Uber or Lyft? Do you want to pursue a job that allows you to chase your artistic passions (with the potential of getting a foot in the door for a future career)? Freelancing as a graphic designer or guest blogger might work for you. Do you want something that requires minimal effort and fits seamlessly with your life? Secret shop or host an Airbnb. Choose your side hustle carefully, as you can end up spending a good chunk of your free time on it. You want something that keeps you engaged and invested while giving you the opportunity to make money.
Clever entrepreneurs can turn literally anything into a money-making job. Got a strange knack for assembling IKEA furniture? There’s a market for that. Do you design super nerdy T-shirts for your friends? You can monetize that. Share apps help you make money off of anything from delivering takeout to hanging out with people’s pets. They key is finding something that fits within your lifestyle.
Time Is Money
Consider the time investment in your side hustle. Is your goal making money now? A market that requires building a name or a brand for yourself before turning lucrative might not be the best starting place (unless your end goal is to get embedded in your dream field). Ideally, your side hustle should take little to no investment cash or time, unless it’s something you already do for free. For example, selling crocheted dolls of pop culture icons on Etsy for $15 isn’t worth it if it takes you two weeks to make one. Consider your time as a billable resource, just like your materials, and determine your side gig’s worth.
Get a Little Help
You’ve got the drive, but don’t have the know-how? There are tons of tools out there for you to harness not only to set up your side hustle but maximize your productivity and output. Anything from background noise apps designed to increase output to programs that track how much time you spend on specific projects (for billing/analytical purposes) can help you organize your time, see where your profit comes from, cut out distractions and dead leads, and grow your hustle.
As the idiom goes, nothing is certain but death and taxes. For a side hustler, taxes are an inevitable issue. Entrepreneurs who are new to the freelance life might not understand the legality of when and how to file their taxes. Can you slap your income in with your end-of-year taxes? Do you need to file quarterly? How do you determine your taxable income? Should you file as a business or an individual? These are important questions you’ll have to answer, and sooner rather than later. Delaying dealing with taxes can be expensive and punishing for those on a budget. Plan early and ask for help. Read a tax guide or consult a professional, and you’ll be on the path to eliminating that money crunch from your life.
Photo by Kelly Sikkema
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