Making more money is always great, right? Well, not actually… There are pros and cons we need to look out for before we dive deep into understanding whether taking on a side hustle is the right choice for you.
In today’s world, it’s becoming increasingly common for people to take on side hustles to supplement their income. The 2020 pandemic has taught us the importance of having more than one income source in order to protect one’s financial stability. Whether it’s driving for a rideshare service, selling handmade crafts on Etsy, or freelancing on the side, there are countless ways to earn extra money outside of your 9-to-5 job.
The Pros of Side Hustles
Let’s start by looking at some of the advantages of starting a side hustle.
1. Extra Income
Perhaps the most obvious benefit of a side hustle is the opportunity to earn extra income.
Just imagine, an extra few more hours you could be making money easily by selling a product or service online.
Whether you’re trying to pay off debt, save for a down payment on a house, or just want more disposable income, a side hustle can help you achieve those financial goals faster.
To me, getting a side income was an obvious answer since I wanted to be ahead of my general age group. According to Singsaver, here is the median salary in Singapore.
|Age Group||2022 Median Monthly Salary||2021 Median Monthly Salary|
|20 ~ 24|
|25 ~ 29|
|30 ~ 34|
|35 ~ 39|
Another significant advantage of side hustles is the flexibility they offer. Unlike a traditional 9-to-5 job, many side hustles allow you to work on your own schedule. This can be especially helpful if you have other commitments, such as family obligations or a full-time job.
Some side hustles do have different time commitments. For example, if you are interested in stocks, trading options only work once the US stock market opens around nighttime in Singapore. It can be a perfect side hustle for Singapore
3. Skill Development
Starting a side hustle can also provide an opportunity to develop new skills or hone existing ones. For example, if you start a freelance writing business, you’ll likely improve your writing and communication skills. Or if you start a dog-walking business, you’ll develop your time-management and customer service skills.
4. Networking Opportunities
Many side hustles also provide opportunities for networking and making new connections. This can be especially beneficial if you’re hoping to transition to a new career or industry in the future.
5. Creative Outlet
Finally, a side hustle can also provide a creative outlet. Whether you’re selling your artwork on Etsy or starting a food blog, a side hustle can allow you to pursue a passion or hobby in a way that also generates income.
The Cons of Side Hustles
Of course, starting a side hustle isn’t all rainbows and unicorns. Here are some of the potential downsides to consider.
1. Time Commitment
Perhaps the biggest downside to a side hustle is the time commitment. Depending on the nature of your side hustle, you may find yourself working long hours in addition to your full-time job. This can be especially challenging if you have other commitments, such as family or social obligations.
Related to the time commitment, many people who take on side hustles find themselves experiencing burnout. Trying to balance a full-time job, a side hustle, and other responsibilities can be incredibly taxing, both mentally and physically.
3. Financial Risk
Starting a side hustle also comes with a certain amount of financial risk. Depending on the nature of your side hustle, you may need to invest money upfront to get started. And even if you don’t need to make a financial investment, there’s always the risk that your side hustle won’t be as profitable as you hoped.
4. Legal Issues
Depending on the type of side hustle you’re pursuing, there may also be legal issues to consider. For example, if you’re driving for a rideshare service, you’ll need to make sure you have the proper insurance coverage. Or if you’re selling products online, you’ll need to comply with any applicable tax laws.
5. Strain on Relationships
Finally, taking on a side hustle can also put a strain on your relationships. If you’re working long hours, you may not have as much time to spend with family and friends. This can be especially challenging if you’re starting a side hustle with a partner or spouse, as it can be difficult to balance work and personal time.
FAQs about Side Hustles
Now that we’ve explored some of the pros and cons of side hustles, let’s answer some common questions people have about them.
How much time do I need to devote to a side hustle?
The amount of time you’ll need to devote to your side hustle will depend on the nature of the business and your financial goals. Some side hustles may only require a few hours a week, while others may require much more.
Do I need to register my side hustle as a business?
It depends on the nature of your side hustle and where you live. In some cases, you may need to register your side hustle as a business and obtain any necessary licenses or permits. Check with your local government to find out what the requirements are in your area.
Can I pursue a side hustle while working a full-time job?
Yes, many people pursue side hustles while working full-time jobs. However, it’s important to make sure your side hustle doesn’t interfere with your job or violate any company policies.
How do I know if my side hustle is profitable?
Keep track of your income and expenses, and compare them regularly to determine whether your side hustle is profitable. You may also want to consult with a financial advisor or accountant for guidance.
Is a Side hustle right for you?
In conclusion, there are both pros and cons to starting a side hustle. While a side hustle can provide extra income, flexibility, skill development, networking opportunities, and a creative outlet, it can also require a significant time commitment, lead to burnout, involve financial risk and legal issues, and strain relationships.
Before starting a side hustle, it’s important to consider your goals, priorities, and potential drawbacks. With careful planning and consideration, however, a side hustle can be a rewarding and lucrative way to supplement your income and pursue your passions.