As a new year dawns, many are lingering a cautious eye on their budgets.
According to a recent Fidelity survey of over 3,000 U.S. adults, financial jitters abound. A total of 40 percent of respondents said they were concerned about inflation for 2024, and nearly a third said they were anxious about money.
Bringing in a little extra income could go a long way to alleviate some of the financial stress in 2024. One simple way to start is working beyond the nine-to-five.
So-called “Side gigs” may be their name, but these hustles are not a peripheral phenomenon anymore. In recent years, online hustles have moved from the margins to the mainstream of the labor market.
More and more Americans are juggling gigs to double dip on income. According to one GOBankingRates survey, almost 40 percent of people have at least one side job. The portion of younger Americans is even higher, with over half of Gen Zers and half of millennials having some kind of hustle.
But not all hustles are created equal. Based on some estimates, the average side gig generates $473 per month, equivalent to $5,700 per year. How can one maximize returns?
Designing a savvy side hustle strategy can make all the difference to those who want to boost their income. By looking ahead and factoring in personal preferences, aspiring side hustlers can get off on the right foot.
Something on the Side
The most appropriate hustle will vary depending on individuals’ circumstances.
What sets side hustles apart from traditional work is that they have minimal structure, and so can be done in one’s spare time. In this way, side hustles fit around a lifestyle, whether that be to optimize for physical mobility or social connection.
Food delivery, online tutoring, short-term rental hosting, and pet walking are among some of the most popular, lucrative side hustles. Ideally, a hustle can be a hobby that can be readily made into a profitable activity.
Another way to identify is to focus on an existing profession and branch out to make extra income by outsourcing your skills to corporate clients.
“Many companies do not have the budget to hire a full-time employee but could use your help a few hours each week,” says Emily Casey Rassam, senior financial planner at Archer Investment Management. “Consider a second job utilizing your expertise and experience from your primary career. Reach out to target companies and offer your time and services. They might not have listed a position, not knowing you exist.”
Care should be taken, however, to maintain boundaries between day jobs and side hustles.
It might not be wise to compete with one’s regular employer in the market under their nose. Amid the pandemic, some professionals began using the freedom of remote work to take on multiple full-time jobs in a trend known as being “overemployed.” unbeknownst to their bosses, these workers doubled up on pay while only devoting half their available energy to each job. Yet, such a strategy can backfire.
“Integrity and honesty are a must,” says wealth wellness expert and certified financial planner Dawn Dahlby. “Discuss with your employer the side hustle and that you have boundaries set between both responsibilities.” says wealth wellness expert and certified financial planner Dawn Dahlby.
A gentler path may appeal to others.
Not everyone has extra time on their hands to work a second job, even a casual side hustle.
Americans, after all, spend a lot of time on the clock. In 2021, American employees worked 184 more hours than their Japanese counterparts, 294 more hours than British workers, and 442 more hours than German workers.
Thankfully, there are other unconventional passive income methods that can provide extra income with limited time commitment.
Some homeowners also rent out their backyard pools.
“We have especially seen spikes in areas where there have been heat waves over the summer, where we see a 40% increase in pool requests,” says Bunim Laskin, CEO of Swimply, a platform that allows people to rent out their swimming pools to guests. “Popular pools continue to see their pools booked out in well in advance.”
Most rental-type incomes first require assets of some kind, whether it be renting out a spare room, parking space, or even a car. Other options, like a vending or a claw machine, help automate the sales process.
Most will require some up-front investment. A typical vending machine, for instance, will likely be between $3000 to $7000, depending on size and type. However, once it is up and running, it may eventually cover the initial cost and begin earning recurring revenue.
There is no dearth of online content about so-called ‘get rich quick ideas.’ These are very risky and difficult to pull off. Most attempts will end in failure. For instance, few who invest in high-risk, high-reward stocks or try to design and launch a super app strike it rich right away.
For most folks, financial security is a marathon, not a sprint. Yet, by finding new avenues to generate extra income, one can build momentum and compound their returns over time. Whether it be starting a new side hustle or committing to higher savings targets, with forward planning and fiscal prudence, 2024 can be an opportunity to gain ground in one’s financial journey.