Pamela Capalad is a Certified Financial Planner™ and founder of Brunch & Budget, a financial planning service that makes talking about your money less scary and more delicious. She loves helping entrepreneurs and freelancers streamline their financial lives so they can focus on growing their businesses.
I remember when I first contemplated quitting my job. The agony of deciding whether or not I should do it, and then when. The anxiety or wondering how I would ever make as much money as I was working for someone else. The relief of giving notice to my boss. The panic that set in the first week I didn’t receive my paycheck.
While ideally, you’d want to be working on your business 24/7, most of us will need to find other ways to put food on the table while we are ramping up the business.
Below are some steps you can take to start building up some side income while you work your business:
Find your Minimum Viable Income (MVI):
We’ve all heard about putting together an MVP, or minimum viable product, so that you can hit the ground running with something that you can put in front of customers and begin to test and iterate on immediately.
You should do the same with your personal income and come up with your minimum viable income. Come up with the least amount of money you would need to spend each month to survive and still be able to function. Just like you MVP, your MVI will not be ideal, and probably a little uncomfortable. You will have to sacrifice a few things along the way to get you through this time.
But also just like an MVP, you will find that there are some things you thought you couldn’t live without that it turns out you don’t miss at all.
Write down the consistent (or relatively consistent) income you’re making now. What is the current income you can count on now? Do you have a product or two that sells pretty well each month? Is there a part time gig or a long term project you’re currently working on?
Think about what you’re making now and figure out the gap between your current income and your Minimum Viable Income.
Close the gap:
Next, write down all the possible skills and resources you can tap into that you can use right now. Write down everything you’ve done that you’ve gotten paid for in the past and things you can do that you’ve heard other people have gotten paid for.
- Can you design logos and websites quickly? There’s a side hustle for that.
- Are you handy around the house? There’s a side hustle for that.
- Love dogs and wouldn’t mind watching them at your place for a few days? There’s a side hustle for that.
- Know your neighborhood like the back of your hand and love telling visitors your local “secrets”? There’s a side hustle for that.
- Do you have a quick skill you can walk someone on video? There’s a side hustle for that.
- Have a spare room? (Or a living room that can fit a tent?) I’m sure we’ve all heard of the side hustle for that.
You’d be surprised what you can get paid for these days. Before you start deciding what you would and wouldn’t be up for doing, just take some time to brainstorm and research a few ways to make some extra cash.
Then go back to your list and circle the top 3 options you’re most willing to try, if only for a month or two, how many hours of time it would take up per week, and how much money you could potentially make. The more related the side income is to your business, the better.
Time to test:
Ask yourself, does the amount close the income gap? Is the amount of time it will take between 1/3 and 1/2 the time you plan to spend on your business? If you answered yes to both questions, start testing now! The sooner you test, the sooner you can iterate and update the income.
If you can’t quite answer yes to both or either question, go back to your list and choose two more options you’re willing to try for a short period of time.
What if this ends up taking too much of my time?
This is a fear new freelancers tend to have. If they spend all their time and energy on side income, will their business fall by the wayside?
This is why it’s important to prioritize side income options that are as closely related to your business as possible, give yourself a 1-2 month window to test, and make sure it only takes up a fraction of the time your spend on your main business.
But also don’t let some initial hiccups from setting up a new side hustle stop you from continuing to test it.
Last month, money started to get a little too tight for comfort so I talked to my boyfriend and we decided to try Airbnb for the few weeks we would be traveling in September and October.
At first, it stressed me out. The requests would come in and there would be this pressure to respond as fast as possible so we could rank higher in the searches. I got caught up in the hustle and our first guest hadn’t even arrived yet!
Coordinating the key handoff while we were gone was an ordeal and getting the house together while we were trying to plan for a conference and road trip felt so overwhelming.
If this was going to take up so much of my brain space, was this worth it? I stepped away from it for a few days and let the first guest actually roll through. It happened while we were out of town, in the middle of the conference. He texted and said he got in all right and the place looked great.
Another reservation request rolled in that day and we took it. Now that the initial set up was done with our very first guest (barely), it felt like we could handle a second one and we were willing to see how it went a second time.
The fact that we were able to pull off coordinating all of this on the road was a relief.
Having this extra income will be giving me breathing room to spend more time working on my business without having to worry about how we’re going to pay for next month’s expenses.
The extra time it took to set it up initially has given me peace of mind to be able to make and implement long term plans for my business.
Make sure your side incomes stay on the side so they can do the same.
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