Category SMMEs

Starting a side hustle to supplement your income could be a solution in this sluggish economy

07 February 2023 Claire Klassen, Consumer Financial Education Specialist at Momentum Metropolitan and Hiten Keshave, Founder of The Unconventional CA

There is no doubt that everyone is now feeling the pinch of economic pressure as inflation and interest rates continue to rise and the costs of living skyrocket. In this climate, it’s not a bad idea to explore some form of a side hustle to supplement your fixed income.

Before you take the leap, however, you need to find out from your employer what the company policy is and whether you are allowed to pursue your planned side hustle outside working hours. It’s important to make sure there is no conflict of interest, that may put your main job in jeopardy.

If you get the go-ahead to start a side hustle, then you need to set boundaries and practice self-discipline so that you don’t neglect your daily duties.

Balancing your full-time job and side hustle, won’t always be easy, particularly in the beginning, but managing your time wisely using techniques like timeboxing can help. Time management is one of the key challenges because a failure to dedicate specific time to getting the wheels off the ground in the early stages of a side hustle can lead to limited traction and frustration.

Here are some of the key points you need to think about when starting a side hustle:

• First, you need to examine what you can offer as a service that comes naturally to you and that you are good at and passionate about. This approach will ensure that there is little to no capital required to hire a resource, train the resource, and pay their salary.
• You can also choose a side hustle that requires very little capital and minimal effort to start generating revenue like babysitting or tutoring students and learners.
• You can ask your family members to support you or spread the word and tap into people in their network who may be seeking your service offering.
• Use social media platforms to advertise your business to create a following and interest in your product or service. Social media followers or members of community WhatsApp groups will share their opinions, and you can use the opportunity to send out a survey to determine what type of service is lacking in the area.

Once you’ve started your hustle, here are some of the top tips to help you get it off the ground without impacting your finance and full-time job:

• Budget wisely from your fixed income and only save 10 – 20% of that income to invest it into your side hustle. Make sure that you do not inject too much of your own money into the venture if there is little chance to recover the money.
• Don’t quit your full-time job just yet. Don’t make the mistake of quitting your full-time job to access the pension or provident payout that is supposed to be saved for your retirement and future financial needs.
• Upskill yourself and consult with an expert about how to structure your finances in your business to ensure that you comply with SARS legislation. Consult an accountant who will be able to explain income tax legislation to protect your interests from financial ruin.
• Buy liability insurance to safeguard yourself against damages caused by poor service or misrepresentation of the product. Also invest in a business or commercial insurance to protect your assets from loss through theft, fire, or damage.

Successful people typically have multiple income streams and starting a side hustle is a good way to generate extra income. Make sure you know the financial and time commitments required, speak to a professional financial adviser to guide you, and don’t let it get in the way of your full-time job. Most of all, enjoy the journey.

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