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What is a side hustle?
Side Hustles are jobs or services you can run alongside your full time or part time job. Many people start a side hustle for extra cash, as a way of making money from a hobby or sometimes as a test to see if they can run it as a full-time business.
A few examples of side hustles:
- Start selling products through a Multi-level marketing (MLM) e.g. Avon, you get a commission but don’t get paid for your time.
- You set up an ecommerce shop selling things that you have made.
- You work evenings and weekends as a photographer.
What is a passive income?
Passive Income is a way of earning money all hours of the day without being directly involved. You put in the initial work and time, and earn an income after the fact. This way you are not dependent on an hourly rate. What you earn from passive income can vary massively depending on the success of the product/service.
A few examples:
- Investments and property
- Affiliate sales
- Amazon FBA
What are the benefits of side hustles and passive income streams?
You can test a business idea without fully committing to it with your money or time. This makes it a much lower risk than some new ventures. Starting a business in this way will also allow you to continually tweak the prices, services and offerings to test the market.
e.g. You could start freelancing as a photographer in your own time without quitting your full time job and test different pricing packages.
Can side hustles and passive income overlap?
Yes they can. When setting up passive income streams and side hustles you are learning new skills, widening your network and these can all lead to new opportunities.
An example of overlap is , if you are coaching as a side hustle and have a website that sells your coaching, you can also use the website to sell your eBook (passive income).
Passive income streams can also lead to new side hustle income. e.g. you are running a successful amazon FBA store which leads to a consultancy position looking at someone else’s amazon FBA store.
Which should I choose a side hustle or passive income?
That’s entirely your decision and to help make the decision easier ask yourself these questions:
- How much time each week do you want to give to this endeavour? Side Hustles tend to need more consistent time allocated to them, such as finding and working with clients. Passive income streams can be slower to start earning but you are able to pick it up and put it down, so if you can’t give consistent time to it – this could work well for you.
- What are your short term and long term goals for this? Break them down into different areas of your life: financial, career, lifestyle, family.
- What are your skills and experience? Do they lend well to becoming a freelancer? Think about your interests and hobbies, not just your work experience. What do people ask your advice about?
Take some time to research your options and make some plans for your own side hustle or passive income stream as there are plenty out there to choose from.