What Is a Side Hustle?
A side hustle, or side business, is a way to earn extra money beyond your main job. It can also be a chance to try something new or gain more experience in a different field. Many people begin side hustles based on something they enjoy or are good at.
Some of the benefits of starting a side hustle include earning extra income, building a path to possibly working for yourself full-time, or expanding your skills and career options.
Key Points to Know
- Many people start a side hustle to earn more money or gain new experience while keeping their main job.
- A side hustle can be something you enjoy, or it can be based on skills you already have, your job background, or your lifestyle.
- Even though side hustles may seem informal, it’s important to understand the financial, legal, and tax rules that apply. Make sure to research before starting.
- There are many ways to run a side hustle. You could offer a service like writing, tutoring, or handyman work. Or you could sell goods online through dropshipping, marketplaces like Etsy, or at local events.
How to Start a Side Hustle in 7 Steps
Not all side hustles follow the same path, but here are some common steps to get started. It’s important to research and understand the financial, legal, and tax rules in the area where your business will operate.
1. Think Through Your Options
Start by looking at your own skills, interests, and lifestyle. A good starting point is where your strengths or hobbies match something people want or need.
2. Research the Market
Look at other businesses offering the same service or product. Find out who your target customers are and make sure there is demand for what you plan to offer. This step also helps you understand how to set your prices.
3. Make a Business Plan
If your side hustle needs money from partners, banks, or investors, you will need a business plan. This should include your business goals, what you’ll be selling, your marketing approach, financial details, and other key information.
4. Estimate Costs and Plan for Funding
List all the costs needed to get started. Even if your startup costs are low, it’s still important to know what they are and plan how you will pay for them.
5. Pick a Name, Structure, and Location – Then Register if Needed
Decide where and how your business will operate. This will affect taxes, legal paperwork, and your personal responsibility if anything goes wrong. You may also need to register your business and apply for a tax ID.
6. Get Licenses, Permits, or Certifications
Depending on your business type and location, you may need certain licenses or permits. Memberships or certifications might also be helpful or required. Include any fees for these in your startup costs.
7. Open a Business Bank Account and Look Into Insurance
It’s a good idea to keep your personal and business finances separate. Opening a business bank account helps with this. You might also need business insurance, depending on what you’re doing and the risks involved.
Pros and Cons of Having a Side Hustle
Pros:
- Flexible schedule
- A chance to do something you enjoy
- Extra income
- Growing your skill set
- Testing out a business idea with low risk
Cons:
- Less free time
- Losing interest in a hobby once it becomes work
- Financial or legal risks
- The business might not succeed
- Complicated taxes
Other Things to Keep in Mind
- Taxes: If you make more than $600 from selling goods or services, you may receive a 1099-K form and will have to report it as income. The IRS has guidelines to help decide if what you’re doing counts as a hobby or a business.
- Marketing and sales: Have a plan for how you’ll let people know about your products or services.
- Ongoing costs: Consider regular expenses like shipping, website fees, licenses, or storage.
- Managing money: Cash flow matters. Make sure you can cover costs like supplies, bills, or any employees, and that the money you earn arrives in time to pay for them.
Helpful Tips for Starting a Side Hustle
- Balance your time. A side business can take more time than expected. Set work hours so it doesn’t overwhelm your life.
- Use your skills. Doing something you enjoy is great, but turning a hobby into work can make it less fun. Sometimes, using a job skill might be a better fit.
- Start small. Begin with a simple version of your idea to test it before growing.
- Use free tools. Spread the word through social media or by telling people in your network. You don’t need to spend a lot on marketing at the start.
- Know your options. Think carefully before taking on debt or working with investors. Understand the risks and conditions.
- Do your research. Knowing why some side hustles fail can help you avoid mistakes.
9 Side Hustle Ideas
Here are some popular ideas that people often try:
- Digital marketing: Offer help with social media, websites, or online ads.
- Bookkeeping: If you’re good with numbers or have accounting experience, you can help others track their finances.
- Teaching or tutoring: Use your skills or knowledge to teach others.
- Babysitting or pet sitting: A great option for people who enjoy caring for kids or animals.
- Dropshipping: Sell products online without keeping inventory.
- Creative products or services: Sell handmade items or digital products like photos, templates, or ebooks.
- Writing or editing: Offer content creation services to businesses or individuals.
- Coaching or classes: Teach skills like cooking, design, investing, or fitness either in person or online.
- Home or yard services: Offer help with car washing, lawn care, snow removal, or handyman tasks.
Common Questions
How can I start a side hustle from home?
Choose a service that can be done online or from your own space. If you’re selling physical goods, make sure you have room to make, store, and ship them.
Can I start a side hustle with no experience?
Yes, many side hustles don’t require prior experience. Services like babysitting, lawn care, or pet sitting are great ways to begin with little to no background.
How can I start a side hustle with no money?
Start with what you already know how to do and use free tools to market your services. Word of mouth, social media, and email are great places to begin.
If you’re just looking to make money, consider joining platforms that pay for tasks like surveys or product testing. Examples include User Interviews, Survey Junkie, Swagbucks, and UserTesting.
What side hustles pay weekly?
Freelance work allows you to set up your own payment schedule. Some ecommerce platforms also offer weekly payouts depending on how they’re set up.
What is the most profitable side hustle?
The most profitable side hustle depends on your skills, interests, and how much time you can put into it. The best one is usually the one that brings in the most income for the time and money you put into it.
Final Thoughts
A side hustle is a good way to try out a business idea without taking on too much risk. But before you begin, think carefully about the pros and cons. Do your research so you understand what’s involved, including rules, costs, and how to market your business. With the right approach, your side hustle can grow into something meaningful—and profitable.
