How To Start A Side Hustle

Hello, readers! Welcome back to the Hoods Tax & Accounting blog! If this is your first time here, welcome! We’re delighted to be able to share up-to-date information about taxes, bookkeeping, and accounting. Our blog is also dedicated to educating you about tax-advantaged savings accounts, tax provisions, programs, and more! We aim to provide you with the tools needed to meet your short and long-term goals. Our seasoned professionals are experts on the tax code, eligible deductions, and QuickBooks—all necessary fundamentals for saving you money! The Hoods Family has been around since 1988 and our comprehensive accounting and tax planning services are among the best in the Lowcountry. If you’re in need of tax preparation, accounting, QuickBooks training, or business consulting services, do not hesitate to schedule an initial consultation! We are officially in tax season, and Tax Day is fast approaching. We recommend preparing early to maximize your savings and refund. We do offer contactless services using a combination of over-the-phone consultations and digital drop-offs, for safety and convenience. You can read more about our hours and submit a request for a meeting using our website!

Although tax season is over, we are still available to help with any questions or concerns you may have. Before we get into today’s topic, we would like to make you aware that we are offering tax planning appointments to assist with questions about withholding, small business tax, retirement and investment accounts, sale or purchase of rental properties or other estates, and more! Reach out to us to set up an appointment with one of our knowledgeable tax professionals. 

Today, we’ll be discussing everything you need to know about starting a side hustle! A side hustle is essentially a side job that brings in extra income beyond one’s regular job or occupation and main source of income. According to a 2021 study, 73% of Americans rank finances as their number one stress in life. Additionally, younger generations tend to be more stressed about finances than older generations. With that in mind, it is no surprise that so many people have started a side hustle to supplement their income. If the majority of your income seems to be going towards bills, starting a side job can be a great way to have some extra income for entertainment or to save in case of an emergency. Even if money isn’t tight for you at the moment, a side hustle can be a great way to earn extra income– Who doesn’t enjoy some extra money? If you’re interested in learning more about how to start a side hustle, you’re in the right place. Let’s get started!

It has been found that 45% of working Americans report having a side hustle– And for good reason. Besides the opportunity to earn supplemental income, starting a side hustle is a great opportunity to tap into your creativity, try new things, and cultivate new business relationships, all while keeping your day job. But how do you get started?

Identify Your Interests And Skills

One of the first things you’ll want to do is identify your interests. What do you enjoy? What are you good at? It might be helpful for you to create a list of your interests and skills. Your interests might even include a hobby that can easily be turned into a business, such as art or music. For example, you can create and sell art or give piano or guitar lessons. Whatever it may be, you want to make sure you are equipped with the relevant skills needed to launch a successful business. If there is a particular area of interest to you that you do not have the skills for, you may consider learning how to do that first. If you can’t think of a particular hobby, try thinking of something you simply excel at. For example, if you are really great at math or writing, you may consider tutoring. There are so many possibilities for a side hustle! But keep in mind that this should be something you truly enjoy. Your day job likely takes up a lot of your energy, so your side hustle should be something that you will be excited about in the long run. Another thing to consider is how much time you will have to dedicate to your side hustle. Don’t overexert yourself! 

Create A Business Plan

A business plan is the key to any successful business! Once you’ve identified what your side hustle will be, it may be tempting to immediately jump into it. However, without a plan in place, things can fall apart quickly. This plan will allow you to stay organized and set goals, and it will save you a lot of time down the road! Let’s take a look at the specifics of a business plan. 

• Summary: Write down exactly what your business will be. What products or services are you selling? What specific industry is your business in? Why do you want to start this business? These are just a few of the questions that should be answered in your summary. This can also be the place where you can think of and write down a mission statement for your business.
  
• Market research: Identify your target audience. Who are they? Dig deep and get specific. What kinds of people will buy from you? Think about demographics like gender, age, and location. What social media platforms are they using, and how are they getting information about new products? You’ll want to find out and write down any information that will help you reach this specific audience. Do some research on other businesses selling similar products or services– These are your competitors. How will your business stand out from the crowd? Doing research on your specific industry will help you determine how you can make a better offer to consumers.  
  
• Sales and Marketing: Once you’ve figured out your product and target audience, it’s time to get down to the center of it all: Sales. How are you going to market your product and sell it to customers? Think about what social media platforms you will use to market your product. Will you run ads? Will you use email marketing? This is also the part of your plan where you determine how you will sell your products. Will you use an online marketplace, or will you sell face-to-face? Think about how much your product or service might cost, and compare it to your competitors. If you’ll be selling online, make sure you factor in shipping costs. 
  
• Finances: This is arguably one of the parts of starting a business that many people forget to factor in. How will you finance your side hustle? While you are likely starting a side hustle to make extra money, you are likely going to need to put some money into your business as well. Consider startup costs: How much money will you need to get started? Where will this money come from? These are two extremely important questions you’ll need to answer before you can move on with your business. This part of your plan is also where you can set some goals. How much money do you expect to make? Make sure you are setting realistic, measurable, and attainable goals. It can be easy to say that you want to make an extra $300 per month, but is that realistic? You’ll also want to think about how you are going to track your expenses. (You may find our blog about expense tracking helpful!)
  
• Products and Services: Now it’s time to actually set a price for your products. What are you offering, and how much is it? If you plan to offer different products, make sure you write each of them down in an organized manner. How will you deliver your products to your customers? If you will be shipping products, be sure to factor in the shipping costs, including the costs of supplies.
  
• Operations: This part of your business plan details how your business will run. Will you be working alone, or will a friend or family member be helping you with packaging orders? Will you be operating your business out of your home, or will you invest in an office space? You should also create a budget and timeline for product development. How are the products being produced, and how long will it take to produce one product? Add anything that will help you organize your business in this section.
  

Your business plan will probably change over time, and that’s okay! Starting any type of business is a learning process, especially if you have little to no marketing experience. 

Don’t Give Up!

Remember, your side hustle needs to be something that you truly enjoy doing. You won’t get very far if you lack determination and genuine interest in your business. Be prepared to spend the free time you have outside of your day job working on your new side hustle. Success won’t happen overnight, so make sure you power through any obstacles in your way! This is also where setting realistic and measurable goals comes in. Everyone is hungry for success, but you’ll be extremely disappointed if you set unattainable goals with no measurable results. 

These are just a few of the steps you can take to start a side hustle! We hope you found this article helpful, and if you feel that you want your side hustle to turn into something bigger, we encourage you to reach out to us for business consulting! Here at Hoods Tax & Accounting, our tax professionals are always eager to give our clients as much help as possible when it comes to their finances. If you have any questions regarding your taxes, or if you need help with tax planning, contact us! Hoods Tax & Accounting offers a variety of services including small business consulting, QuickBooks training, tax preparation, accounting, payroll, and more! Visit our website for more information, as well as helpful links to resources you may find useful. Thank you for reading and we hope to see you back next time to keep learning about various tax and accounting topics!