6 Key Signs a Side Gig Isn’t the Answer to Your Money Needs
Written by
Cynthia Measom
Edited by
Amber Barkley
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If you’re living paycheck to paycheck, you might think you need to get a side gig to cover your expenses and have some fun money left over. But depending on your spending habits, a side gig might not be the answer.
Could it be that you’re mismanaging your money? If you’re guilty of these key signs, a side gig isn’t the answer to your money needs. Take a look — you might be surprised how changing your habits could put more money in your pocket.
You Don’t Have a Budget
A budget is a monthly plan for your money. Without it, you could be spending indiscriminately.
Say, for instance, you have a habit of treating yourself to an expensive dinner and drinks at your favorite bar or a Saturday shopping spree every time you get paid. By doing so, you could potentially be blowing several hundred dollars that could go toward bills.
That’s not to say you shouldn’t enjoy yourself occasionally. However, if you budget a reasonable amount each month for those kinds of expenses and stick to it, you won’t overspend.
You’re Not Tracking Your Spending
A budget only works if you track your spending. The budget is your plan of action, but without actually recording how much you’re spending in each category, you won’t be able to course correct if needed.
For example, if you’ve budgeted $150 per week for groceries but spend $175, you’ll need to cut back in another category, such as entertainment, to make up for the extra expense. So maybe at dinner, you don’t order appetizers and that second drink. This helps keep you from spending more than you make.
You Don’t Have an Emergency Fund
When you blow a tire, need a root canal or have a pet that needs expensive medical treatment, having an emergency fund can provide the cash you need to pay for those expenses. Without an emergency fund, however, you’ll have to either dip into your bank account or charge the expenses to a credit card, which can result in negative consequences.
If you remove money from your budget to pay for several hundred dollars of expenses, you’ll have to drastically cut back on your spending or take measures such as deferring payments. Charging the expenses to an already overloaded credit card can push you closer to your credit limit — plus, you’ll have to pay interest.
You Have Too Many Recurring Charges
Stop and take an inventory of how many streaming subscriptions or monthly subscription boxes you have — or other recurring monthly charges, like an unused gym membership.
Keep in mind that these kinds of expenses are up to your discretion, which means they aren’t necessary to spend on, like food, utilities and housing. That means if you’re paying for multiple streaming subscriptions and subscription boxes, choose one from each and cancel the rest. You might be surprised at how much money you’ll save each month.
You’re Using Your Credit Cards Too Much
If you don’t pay off the balances on your credit card each month, those balances are subject to interest charges, which just adds more debt to your plate. If you’re using your credit cards for purchases that you can’t pay off before interest charges apply, stop using your cards immediately.
Going forward, every time you want to make an unnecessary purchase with your card, consider putting at least half the amount you would have spent on the purchase toward your credit card debt in addition to your regular payments. This strategy can help you pay off your balances more quickly and ultimately reduce the amount of interest you’ll pay.
You’re Overloading Yourself With Buy Now, Pay Later Payments
Buy now, pay later offers can make purchasing so tempting and convenient. And while they do have their benefits, such as no interest, you can still spend too much and end up with five different payments of $20 or so each month. If you use this type of payment method, pay off each purchase you make before initiating another one. That way, you won’t overload yourself.
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