If your paycheck never feels like enough to cover the bills or buy the latest gadget you’ve been obsessing over, it’s time to get a side hustle. Having an extra stream of income in addition to your day job can help with financial stability and give you a buffer of cash to start saving for your financial goals. Starting a side hustle doesn’t have to be expensive or time-consuming. In fact, all it takes is some creativity and dedication.
Whether you’re looking for more financial freedom or the chance to try something new, a side hustle could be the way to go. In this guide, we'll cover everything you need to know about how to start a side hustle. You'll learn how to develop business ideas, how to turn those ideas into profits, and more.
- There are many factors to consider when starting a side hustle, including your time, skills, and finances.
- Be aware of startup costs such as licensing fees or purchasing equipment.
- There are many side hustle options, including those that don’t require any upfront costs.
- There are four main business structures in the U.S.: partnerships, sole proprietorships, limited liability companies (LLCs), and corporations.
- Success requires hard work and dedication, and making money through a side hustle does not happen overnight.
How to start a side hustle
Starting a side hustle is an exciting journey that could bring in extra income and the flexibility to explore your creativity. But how do you decide on the right side hustle for you?
It's essential to take time to research different ideas, create a business plan, and have a careful look into your lifestyle and skills. Here are the steps you should take as you embark on this journey.
Decide on a side hustle
When deciding what kind of small business idea works best for you, consider the following factors:
Amount of investment
Consider how much money is required upfront to start the business. Anything necessary for launching the business should be factored in here, including startup costs such as licensing fees or purchasing equipment. The costs can range from very low to several thousand dollars, depending on the side hustle you choose.
Consider how long it may take before seeing tangible results from your efforts. Some businesses experience rapid growth, while others may require more patience before earning profits.
Additionally, how much you earn is likely proportional to how much time you work on your side hustle, so look at your schedule to see how many hours you can dedicate to it. For example, if you’re working a full-time job, you might only be able to work on your side hustle on the weekends, and that will influence which option is best for you.
Lastly, assess how comfortable you feel taking risks with this new endeavor. Some ideas come with higher levels of risk than others, so make sure you are ready to handle the responsibility.
Create a plan
Once you have decided on a business idea, the next step is planning how you will launch and manage your side hustle. An essential part of this step is conducting thorough research. The more detailed your business plan, the better prepared you'll be when starting your side hustle.
To help you get started, consider the following common components of a business plan. Because every business is different, your plan should be tailored to your specific situation. For some side hustles, you don’t have to write a formal business plan, but you should still consider the following:
- Goals and objectives: Define how you want to achieve your goals, how long it will take, and how much money you need to make.
- Budget: Outline how much money you need to invest in starting the business and how long it will take before you start seeing returns.
- Business structure: Understand how each type of business structure works and how you can best use them to your advantage.
- Marketing strategies: Decide how you'll reach your target customers and stay visible in the market.
- Legal requirements: Determine what licenses, permits, and documentation are required for your side hustle.
Choose a business structure
A business’ structure has implications for how the business is taxed, how ownership is established, and how legal disputes are handled. Because you are automatically a sole proprietor if you are the only owner and you are performing business activities, most side hustles are sole proprietorships.
A sole proprietorship is a business structure that is owned and operated by one individual.
Sole proprietorships provide a simple way to start a business that typically doesn’t require formal registration or paperwork-filing requirements. The tax obligations are also much simpler than other types of businesses, as all income earned is reported on your normal income tax return.
The downside to a sole proprietorship is that your business assets aren’t separate from your personal assets, which means you could be held personally responsible if your business is sued or if your business is in debt.
A partnership is an arrangement where two or more people come together to conduct business as co-owners.
Partnerships can be either formal or informal, with different arrangements that determine how each partner’s responsibilities are divided and how profits are shared. Partnerships generally have lower startup costs than other business structures but do require formal filing and documentation.
Limited liability company (LLC)
An LLC is a business entity that offers limited liability protection to its owners. It combines aspects of a corporation and a partnership, and allows for flexibility in management and taxation.
The owners of an LLC are not liable for debts or liabilities the business incurs in most cases. This means that if the business fails, its creditors cannot come after the owners' assets. And if the LLC is sued, your personal assets, such as your car, house, and savings, are not at risk.
Depending on the type of side hustle you are starting, an LLC may be a good option to limit your risk.
A corporation has shareholders and is one of the most complicated structures because it must comply with government regulations. This type of business also involves double taxation and additional paperwork, as the corporation must file a corporate tax return each year.
However, this business structure offers the most protection and allows a company to transfer ownership easily. The corporation business structure is typically used for larger companies with significant revenues. For small side hustles, establishing a corporation is likely more expensive and time-consuming than it’s worth.
TipIt's important to understand how each business structure works before deciding which one suits your side hustle best. You should also consult a qualified accountant or lawyer to ensure all legal matters related to your venture are properly addressed.
Get licensed and insured
Depending on your side hustle, you may need to obtain licenses and insurance to operate legally. These documents could also protect your side hustle from potential legal liabilities.
The required business paperwork may differ depending on the state you operate in, but common requirements include:
- Business license
- Tax registration certificate
- Employer identification number (EIN)
Additionally, it’s important to purchase liability insurance for your business so that if someone gets hurt in the course of your business operations, costs and legal fees are covered. If your side hustle involves a brick-and-mortar business location, you will also want to get that insured in case of natural disasters, fires, and other unforeseen events.
Insurance will help reduce financial losses if anything goes wrong while you’re side hustling. Consult a local insurance agent to learn what kinds of insurance are available for your business.
If your side hustle involves contracting for another company, such as Airbnb or DoorDash, you are probably already covered by the company’s insurance.
WarningBe sure to read the documentation you sign when becoming a contractor to understand your rights and protections.
Create a schedule
Starting a business, no matter how small, requires time and dedication. Depending on your availability and the commitment required for your chosen business, this can range from a very part-time schedule of a few hours per week to managing it full time.
Once you have determined your schedule, make sure those times are marked into your calendar so they become part of your routine. After all, if you don’t show up to hustle, you won’t make any money on the side.
Beginner-friendly side hustle ideas
There are plenty of side hustles you can start today, even if you’ve never side hustled before. Check out these options and see what fits at the intersection of your skills, interests, and time available.
If you have a knack for writing, this is a great way to make money on the side. You could create content for businesses, blogs, or even your website. Create a portfolio showcasing your best work samples, as this is often what potential clients look for.
If you're creative and have a background in design, consider offering your services as a freelance graphic designer. You can create logos, flyers, or other visual content for businesses. A portfolio also comes in handy to attract more clients.
TipFiverr and Upwork are two of many platforms that connect freelance writers, graphic designers, and more with clients.
Do you have a skill that you can teach others? Tutoring is a great way to use your knowledge while also making extra money. Before starting a tutoring business, identify your target market, such as the specific subject and student age you will tutor. This will help you determine the best way to advertise and your rates.
You could tutor online or in person depending on your subject matter expertise and preferences. For example, you might contract with a company to teach English online to students overseas.
If you’re good with numbers or have experience with bookkeeping and accounting, you can offer your services as a freelance bookkeeper. Familiarize yourself with different online accounting software such as Quickbooks and Xero. Getting a bookkeeping or accounting certification could also boost your credentials.
Business owners often seek extra help managing their day-to-day tasks, and a virtual assistant can be the perfect way to make money online. You can provide customer support, data entry, or social media management. Typically this role is done virtually, which means you can work from anywhere.
Social media management
Businesses recognize the importance of having an online presence, so they're hiring social media managers to help them manage their accounts. If you have experience with various social media platforms, this could be a great side hustle opportunity.
If you’re an animal lover and have some spare time, pet-sitting is a great way to make money on the side. You can offer to take care of people's pets while they're away on vacation or for long weekends. Pet-sitting can happen in the pet owner’s house or your own house, depending on your preferences. If you are able to pet-sit over the holidays, you could charge a premium.
Similar to pet-sitting, you can make money by being a dog walker. This is also a great way to exercise while making some extra cash. Go door-to-door in your neighborhood, post flyers, or register for a dog-walking app like Rover to find potential customers.
Starting a YouTube channel
YouTube is an incredibly popular platform, and there's no better time than now to get into creating videos. You could begin by documenting how you're getting started with a side hustle or create how-to tutorials on something related to your interests.
YouTube isn’t a get-rich-quick side hustle because you will need to build an audience before you can start earning advertising revenue and money from sponsors.
Driving for Uber or Lyft
If you have a car and some extra time, driving for Uber or Lyft can be a great way to earn more. You can choose how often you drive and how many hours you work, which makes it a completely flexible side hustle. This is a great side hustle for extroverts because you will be interacting with new people while you drive and can even act as a guide to your city for visitors.
Delivering food for Instacart, Doordash, or Uber Eats
Food delivery for a site such as Uber Eats is an ideal side gig for people who like to drive but don’t want the social interaction that comes with being a rideshare driver. With delivery, you don’t have to worry as much about engaging in conversations with customers and can focus on delivering food as quickly and safely as possible.
TipAmazon Flex is another delivery service option. Contractors with Flex may deliver packages, groceries, or other items.
Do you have an extra room or two in your house? You can make some extra money by renting them out on Airbnb. Guests might be staying for a few days, a week, or even longer, which is great if you're looking to make consistent income from a side hustle. Some people even buy a second property to rent out on Airbnb for passive income.
Starting an online store
If you have a product idea that people are interested in buying, consider starting your online store. You can use platforms such as Shopify or Etsy to reach customers worldwide. If you’re tech-savvy, you can also create your own e-commerce website.
Online stores can be used to sell any physical product, including custom T-shirts, candles, arts and crafts, and more. If you don’t have room for inventory, you could consider a dropshipping business where you sell the product and contract with a company to hold the inventory and ship the product to your customers.
Selling items on eBay
Alternatively, if you have items around your house that you don't need, consider selling them on eBay. You can make extra money by selling old clothing, household items, and other goods. You can even find antiques and items such as old game consoles at garage sales and estate sales and flip them for a profit on eBay.
Online surveys and focus groups
Another easy side hustle is completing paid online surveys or joining focus groups. Companies will give you cash in return for your opinion, as long as you fit their target demographic. You won't get rich overnight, but it's a good way to earn extra money. The key is to look for legitimate websites for paid surveys.
Some survey sites to consider include InboxDollars and Survey Junkie.
How do you start a side hustle with no money?
There are plenty of good side hustles that cost absolutely nothing to start. You could start by offering services such as writing, proofreading, tutoring, babysitting, or pet-sitting. Another option is to become a blogger or start a podcast or YouTube channel and monetize it with ads or affiliate marketing. You could start creating or recording these on your phone.
You could also declutter and sell old items on eBay.
How do I find a side hustle?
Start by determining how much time and money you want to invest in your side hustle, then assess your skills and interests. You can also check out job boards, apps, and websites dedicated to finding side hustles. Networking is another great way to find opportunities, so don't be afraid to ask around if anyone knows of any freelancing gigs available. LinkedIn could be a good place to connect with potential clients.
What side hustle should I start?
The best side hustle depends on your skills, interests, and the amount of time and money you're willing to invest. Take some time to research various options and think about what would be the most rewarding for you. Determine whether it’s more important for you to enjoy the work you do or earn a lot of money while doing it. Answering these questions will help you pick the best side hustle for you.
Figuring out how to make money beyond your current income stream can be challenging. The good news is that starting a side hustle is an investment of time and energy with the potential to reap great rewards.
Starting a side hustle isn’t too complicated once you break it down into simple steps. Take the time to do your research and determine which option is the perfect side hustle for you. Once you decide on a venture, commit to the plan and be prepared to put in the work necessary to make it successful.
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