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Vector of a piggy bank. Represents starting a side hustle or side business to generate additional revenue.

How to Start a Side Hustle

It seems like everyone has a side hustle these days—and for good reason. A side hustle is a far less risky way to flex your entrepreneurial muscles and bring in additional income. 

That doesn’t mean you should treat your side gig differently from a business—especially if you want it to grow and eventually become your full-time job. 

In this guide, we’ll walk you through how to make a money-making side hustle, balance it with a full-time job, and determine when it’s time to go full-time.

How to start a side hustle

Starting a side hustle is similar to a full-time business. We’ll focus on the key steps and unique time-investment decisions to get a part-time business up and running.

1. Pick a side hustle that you’re interested in

There are thousands of potential side hustle ideas out there. It may be tempting to pursue something that seems easy or passive. But, to start the perfect side hustle, you should choose something that leverages a pre-existing skillset or you are passionate about.

This not only makes the work more enjoyable but easier to take on, Whether it’s a hobby you’ve always loved, a skill you’ve mastered, or a gap in the market you’ve noticed—your side hustle should be something that excites and motivates you.

How to determine if you have a hobby or a business

A hobby can be a great starting point for a side hustle. But not every hobby is built to generate revenue.

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Side hustle ideas

Do you need help nailing down what your side hustle should be? Check out our roundup of possible side hustle ideas that you can start with.

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2. Decide on your commitment

A unique step in launching a side business is considering how much time and energy you can realistically commit. Remember, this will include your full-time job and personal responsibilities. 

You must be honest about your availability and set boundaries to maintain a healthy work-life balance. You also need to be sure you’re dedicating enough time for your business to gain traction and grow. 

While this depends on your circumstances, reviewing your current habits is a great place to start. Identify when you have downtime—especially when doing something unproductive or enjoyable. That could be replaced with time spent on your side hustle. 

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You won’t know what it’s like to simultaneously work full-time and run a business until you do it. Luckily, we have a few tips from experts who have already gone through this process.

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3. Determine how you’ll make money

Next, you must figure out how your side hustle will generate income. Will you sell a product or service? Will you charge a flat fee or an hourly rate? How much will you charge, and how does it compare to competitors?

Understanding your business model is crucial to making your side gig financially viable. It will also help you know if your business is scalable and better prepare you to take things full-time.

4. Create a one-page business plan

Even though it’s a side hustle, it’s still a business. You need a business plan. 

Creating a one-page business plan makes the process quick and easy and helps you clarify your vision, set goals, and outline your strategy for achieving them. 

Your plan doesn’t need to be a formal document but should cover key aspects like your target market, pricing strategy, marketing plan, and financial projections.

5. Set a timeline and revenue goals

Knowing how much money you’d like to make with your side hustle can be difficult. Since you’re running it along with being employed, your livelihood likely isn’t relying on its success. That doesn’t mean you should skip setting goals for yourself.

Start by considering why you’re launching a side hustle and set revenue goals around that. You could be saving for a down payment on a house, want extra cash on hand, or hope to make enough to quit your job. It’s also helpful to consider how much competitors or similar businesses are making to set realistic expectations.  

Then, take into consideration your time investment. Depending on how often you can work on your business, this can hinder how much you’ll make. 

Finally, it’s essential to make sure your side hustle is legal. Steps might involve registering your business, obtaining necessary licenses or permits, and understanding your tax obligations. You’ll also want to set up a bookkeeping process to be sure you’re keeping track of expenses and revenue.

While this step may seem like overkill, it’s crucial for protecting yourself and your side hustle. It will also make it much easier to go full-time if and when the time is right.

How to go from side hustle to full-time business

Even if it’s not your primary goal, there may come a time when you’re considering making your side hustle a full-time business. Here are a few curated resources to help you through this life-changing decision.   

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Questions to ask before you quit your job

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How to quit your day job and work for yourself

Are you seeking additional guidance to successfully transition from full-time employee to full-time business owner? Check out this guide.

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Why start a side hustle?

Starting with a side hustle is an excellent way to explore the entrepreneurial world without the full risk of leaving your steady income. It allows you to test the waters, learn valuable skills, and potentially build a business that could eventually replace your full-time job.

Here are some additional reasons why starting with a side hustle can be beneficial:

  • Financial safety net: A side hustle provides an additional income stream, which can be especially useful in uncertain economic times. It can help you pay off debt, save for the future, or fund a lifestyle upgrade without dipping into your regular income.
  • Skill development: A side hustle allows you to develop new skills and gain experience in areas outside of your regular job. This can make you more marketable in your full-time job and open new career opportunities.
  • Creative outlet: If your full-time job doesn’t tap into your creative side, a side hustle can provide an outlet for your creativity and passion. It can make work more fulfilling and even improve your mental health.
  • Risk management: Starting a business is risky. But with a side hustle, you can experiment with business ideas and learn from mistakes without the pressure of relying on them for your livelihood.

A side hustle can be more than just a way to make extra money. It can lead to personal growth, financial stability, and entrepreneurial success.

Treat your side hustle like a business

Whether you’re looking to generate extra income in your spare time or want a low-risk method for testing a business idea—you need to run your side hustle like a business.

Spend time creating a business plan. Be sure that you have potential customers. Know how you’ll make money and make it all legal. Following these steps will increase your chances of reaching whatever goal you have for your side gig.

Want to learn more about a specific step? Check out our full guide on starting a business for more.

Side Hustles FAQ

A side hustle is a business or job you run in addition to your full-time job. It’s a way to earn extra income while pursuing something you’re passionate about.

The type of side hustle you should start depends on your skills, interests, and the amount of time you can commit. It could be anything from freelance writing or graphic design to dog walking or selling handmade crafts. Choose something that aligns with your passion and fits into your schedule.

Starting a side hustle with no experience may involve learning new skills, leveraging your existing skills, or finding opportunities that don’t require specialized expertise. Online courses, mentorship, and self-learning can also help you acquire the necessary skills you’re missing.

Good side hustles align with your skills and interests, have an attainable market, and fit into your schedule. Examples could include freelance writing, tutoring, pet sitting, selling handmade products, or offering digital marketing services.

The profitability of a side hustle depends on various factors including demand, pricing, and your expertise. Typically side hustles that require very low operating expenses and can be easily scaled are the most profitable. Some potentially profitable side hustles include freelance web development, online tutoring, or running a niche e-commerce store.

Starting a side hustle can allow you to generate extra income, pursue a passion, develop new skills, and potentially create a business that could become your full-time job. However, it also requires commitment and time management.

Whether you should start an LLC for your side hustle depends on your business’s nature and long-term goals. An LLC can provide personal liability protection and potential tax advantages but also involves costs and paperwork. It’s best to consult with a business advisor or attorney to understand if an LLC is the right choice for your side hustle.