The financial landscape of the UK at the moment has many households concerned, as the Bank of England warns that the inflation rate could reach as high as 10% in the coming months. As wages continue to fall in real terms, questions about what can be done to improve individual situations begin to arise.
One major option that is seeing increased interest from workers in the UK is that of starting up a side hustle – that is, starting up an informal secondary business on top of day-to-day work in order to subsidise household costs. But could it actually be beneficial, and how would you go about starting one?
What are the Benefits of Starting a Side Hustle?
Greater Financial Freedom
Money is perhaps the initial motivation that brought you to thinking about starting a side hustle, and it remains the primary benefit to starting up secondary work. Bringing in that little bit more money can help alleviate any stress brought on by the growing cost-of-living crisis, especially where vital expenditures like fuel and energy increase seemingly exponentially. A side-hustle can help to keep you liquid, and enable you a little more financial freedom even in difficult times.
Build a New Skillset
Investing time and energy into a self-run side-business can also help you to develop skills that you may not otherwise get to develop in day-to-day life. This applies universally; you may be looking to monetise a hobby, in which case you get to justify spending more time on the hobby and improving as a result.
Alternatively, you may have little experience handling accounting and finances, where running your own business enables you to get to grips with spreadsheets, funding and money management. Whatever you’re developing will help you improve your offerings across the board, and could help you professionally as well.
How Should You Get Started?
Register for Self-Assessment
Before you make any official in-roads to earning money, you should take a minute to register for Self-Assessment. Even if you have a full-time day job, starting up a side hustle counts as a form of self-employment, and if you earn more than £1000 in a given tax year you will be liable to pay income tax on your earnings. The upside is that any expenses related to your business can help you bring down your tax bill.
With the back-end admin sorted out, you can begin to advertise your services properly. There are myriad ways to do this in the modern day, but you cannot go wrong with printing business cards and handing them out to friends and acquaintances. Rather than relying on digital ads and algorithms to sell your work to relative strangers, you can build an organic customer base from friends first, then word-of-mouth second. This will also help you keep on top of your workload.
Budget for the Short and Long Term
With your first round of customers or clients in the bag, you can start to get a picture of what your operating expenses will really look like. Using transaction information from your first weeks of operation, you can extrapolate out and figure out a long-term plan for funding – and also what you could stand to earn.