So, you’ve decided that you need a little extra cash and need to take on some sort of side hustle. You’re not alone. According to Self Financial, 45% of Americans working currently have some sort of side gig. However, side gigs do take some preparation to ensure they’re the most beneficial they can be.
Don’t Take on Too Much at First
You might see how much you can make if you take on 20-30 hours a week at a second job and want to jump right in. The problem with this is you’re going to overexert yourself right away. Your quality of work might also suffer, since you’re forcing yourself to go from zero to 100 without taking time to really understand your new job at hand.
Instead, take on a few hours a week at first to see how you can fit the new side gig into your schedule and how you feel balancing both jobs. As you get more proficient at doing both jobs, then you can add more hours and consequently, make more money.
Take Our Poll: Do You Think You Will Be Able To Retire at Age 65?
Ask Why You Want a Side Gig
A side gig is a lot of work, so it’s best to have clear intentions when you start. Are you trying to pay off debt? Save more money? Invest in stocks? Or, are you trying to start a new career? Get paid to do something you’re passionate about?
If you’re not finding an exact reason why you have a side gig, it will probably feel like more trouble than it’s worth. Even if you do have a reason, your side hustle might still feel exhausting at times. Think about why exactly you’re taking this on, and when you do feel tired, think if that reason is still worth working more hours.
Know Your Worth
You might think if you’re just venturing into a side job, you are not entitled to charge very much, or even the market rate. But you’re still dedicating your valuable time to a task. That alone deserves fair payment. You don’t want to take on a second job only to be underpaid for your work. If your reason for taking on a side gig is to generate more income, being undervalued completely defeats that. Research how much other workers in your field are being paid, and don’t be afraid to say no if your employer can’t match that.
Budget for What You’ll Need
Maybe you’re starting a new job that requires items you don’t already own. Find out how much those are going to cost before you agree to a job to make sure the expense is worth it. Although some side gigs might not require any new equipment or expenses, you’ll still want to budget a little bit of money to advertise your services no matter what your hustle is. This might include making a website or getting a Yelp for Business account.
Prepare for Tax Time
Side gigs are typically a little complicated when it comes to taxes. You might have multiple tax forms from multiple clients, and, depending on how lucrative your side gig is, you might have to pay quarterly taxes. You’ll also want to track all of your business expenses so you can write those off.
It’s best to talk to an accountant about what you’ll need to keep track of or pay before you start working so that way you don’t get blindsided when the time comes to file your taxes.
Don’t Be Afraid To Fail
It’s important to remember that when you take on a side hustle, you’re basically starting your own business. There is a lot to learn and no one is expected to know it all when they first start out. You can do all the research and preparation possible, but you’re going to learn the most by doing. While you’re working, you’ll have missteps, but you’ll be able to learn from them. You might disappoint customers or underestimate your taxes, but that’s all part of the process. As long as you’re getting what you need from your side gig, you’re doing it right.
More From GOBankingRates