Side hustles: earning extra income alongside your regular job

Jobsearch, Jobseekers / 25 May 2023

A side hustle is one way to earn extra income in addition to your regular salary. It can also be an ideal tactic to test the water before making the jump to self-employment. Finally, a side hustle can combine spending time on a passion-hobby while making a little money too.

Another reason that many people are turning to side hustles is the increasing availability of flexible working. Whether that’s working from home, flexible hours, or hybrid working, the case for flexible working has been strengthened by the number of people who were forced to work from home during the pandemic lockdowns.

With the current rise in the cost of living that many countries face in the fall-out of the COVID pandemic, a side hustle can be a great way to boost your income while retaining the security of staying in your current job.

What to consider when starting a side hustle

A side hustle may sound like the perfect solution but before you make the move, here are three factors you should consider.

Does your employment contract prevent you from starting a side hustle?

Before you take the jump, it’s worth checking whether your employment contract will allow you to earn money on the side. The conditions of your contract may prevent you from starting a side hustle or taking a second job. Generally, these conditions will be linked to working for or setting up as a competitor, but there may be other factors such as when you work in a high risk industry or role.

What are the tax implications?

With extra earnings, your taxable income will grow. You may even be pushed into a higher tax bracket with an increased tax rate. The extra money you earn may not benefit you as much as you think.

UK example

The 2023/24 tax thresholds are:

tax free allowance – up to £12,570
basic tax rate 20% – between £12,571 and £37,700
higher tax rate 40% – between £37,701 and £125,140
additional tax rate 45% – £124,141 and higher

Let’s take the example of James who earns £12,500 annually. This income keeps him within the tax free allowance, meaning that he pays no tax. If he starts a side hustle that provides additional income of £4,000 in 2023/24, this will push him into the basic tax rate. The difference in his income would look like this:

Income from job alone: £12,500.

Income from job and side hustle:

£12,500 + £4,000 = £16,500
£16,500 – £12,570 (tax free allowance) = £3,930
£3,930 x 20% (basic tax rate) = £786
Income after tax: £16,500 – £786 = £15,714

This means that the additional £4,000 has resulted in an extra net income of £3,214.

US example

US income tax is calculated not only on your income but also whether you file as a single person, head of household, or married person. So if you are a head of household and earning $58,000 in 2023/24, your tax rate is 12%. However, if you earn an additional $8,000 from your side hustle, you will be pushed up into the 22% tax band.

Can you fit in the extra time, expense, and effort?

Starting a side hustle may seem like a great way to earn more money but is it realistic to work a side hustle as well as your regular job?

Do you have the time to work on both your side hustle and job and still sleep, eat, and have a social life?
If there is expense involved in starting and running your side hustle, do you have this money to spend?
Do you have the energy to work both a side hustle and your job, or do you need that time to relax and rest?

The Top 5 side hustle roles in 2023

If you’ve worked through all the above considerations and a side hustle still sounds good, here are the top five for 2023.

Pet sitting and walking

During and since the pandemic, pet ownership has seen a steady increase. Research by Forbes Advisor found that 78% of pet owners in the US bought pets during the pandemic. Post pandemic, the increasing availability of remote and hybrid work in the UK has further encouraged people to buy pets because they’ll have more time at home to spend with them. However, just because more people are working from home, it doesn’t mean they have more time to spend with their pets. Equally, those pet owners who bought a dog or cat during the pandemic may be forced to leave their pet home alone all day as they return to the workplace.

Pet sitters and walkers are therefore in demand, so if you’re an animal lover and you enjoy long walks this might be the ideal side hustle for you.

Tech set up

With more people working from home, there’s a growing need for someone to set up, maintain, and support their home office, for instance, a computer and all the accompanying apps and equipment. Besides this in-person service, you may also be able to provide technical support over the phone, by video call, or in an email. Make sure you have the right set of technical skills, however, before taking this side hustle on.

Virtual Assistant (VA)

A virtual assistant provides a personal assistance role online. Services that a VA covers may include diary management and appointment booking, website maintenance, copywriting, social media management, book-keeping, and proof-reading, to name but a few. VA work is especially suitable if you come from a personal assistant (PA), executive assistant (EA), or secretarial background.

Online trader

Whether you sell through eBay, Amazon, Etsy, or your own website, there are plenty of items you can sell online. It might be:

second hand clothes
craft items that you make, like jewellery, knitwear, or artwork
books
pet accessories
food and drink
downloadables
customised items such as t-shirts printed with your own designs

You could even take it one step further and attend fairs and events where you sell your goods face-to-face.

Online tutoring

If you have academic, musical, fitness, or artistic skills, why not share this knowledge as an online tutor. You can offer your tutoring live by video-call or provide recorded videos to watch on demand. You could even create courses through online training sites such as Udemy or Teachable. Alternatively, you could house your courses on your own website.

Wrapping it up

If you need to earn more money but don’t want to look for a new job, a side hustle may be the ideal solution. However, it’s important that you consider whether:

your current employer will allow you to have a side hustle
there are negative tax implications
you have the time and energy to fit a side hustle into your life

If a side hustle still sounds like a good idea, then there are plenty of ways to apply your skills and enthusiasm to earning extra income alongside your regular job.