Are you running a side hustle? Here are a few simple ways to set it up for success.
Globally, more and more people are creating side hustles while employed. In America, for instance, according to Bankrate, there are 44 million people who have a second job. These numbers are only set to increase as many realize the power of the gig economy.
The chances are good that if you’re reading this, you run a side hustle of your own. You may view it in a particular way: Perhaps it’s a passion project, a convenient source of extra income, a way to make ends meet or even a means to indulge in things you couldn’t otherwise afford.
Regardless, you’ve likely considered what it would look like if you chose to go full-time. However, right now you’re not ready to give up the reliability, security, and many others perks of your day job. Indeed, you may never be prepared, especially if you’ve decided that your side hustle is your passion project. And, that’s okay!
But, whatever your reasons for keeping your side hustle on the side, there are ways that you can optimize it so that should you ever decide to grow it into something full-time, you’ll have all your ducks in a row.
Here are four ways to set your side hustle up for success:
1. Get a Grip on Basic Finances
You’re likely running a lean business and want to keep your overheads low, right? That might mean avoiding investments in tools or software that you deem unnecessary. I get it. I had the same mindset when “writing” was my side hustle.
But you know what? The transition into going full-time would’ve been much easier had I invested in some basic business tools. Cloud accounting is just one example of a tool I wish I’d used from the get-go because it would immediately have saved me time, but also set me up with options for future growth.
Invoicing That’s Better Than Word or Excel
You – like many small business owners – likely use Excel to create and manage invoices. Afterall, Excel is what you know; it’s what’s familiar.
The problem is that this familiarity – combined with the desire to keep your costs down (it’s a side hustle, right?) causes you to overlook obvious signs that it’s not the best way to create and manage your invoices: Using Excel is time-consuming and it’s easy to lose documents.
It’s even easier to make some common invoicing mistakes such as incorrect invoice values and wrong PO numbers. Those mistakes mean you have to adjust the invoice, save it as a PDF, and then send it via email all over again. That’s a lot of effort for something as simple as sending an invoice.
Thankfully, cloud accounting makes invoicing painless, so you spend less time creating invoices and fixing errors and more time growing your side hustle. For example, invoicing with FreshBooks lets you:
- Create professional invoices fast: include a logo, choose a color, specify billing details, add a personal note, and create a duplicate that you can reuse and alter.
- Automate processes: set recurring invoices for regular clients, so you don’t spend time duplicating work
- Invoice while on the move thanks to a mobile app
- Charge upfront deposits so you can get the needed cash to kickstart any project
- Bill what you’re worth: Track your time and mark expenses as billable and then pull that information into an invoice.
- View how much income your side hustle is bringing in with income reports that are accessible from the dashboard
Tracking Expenses Beyond a Shoebox of Receipts
It’s common for many to track expenses somewhere along a spectrum of keeping receipts in a bag or a shoe box and using Excel to record transactions. Indeed that’s how I used to track my expenses.
The problem is that these methods are time-consuming and messy. Let’s not forget the lost receipts and money when filing tax returns. Yes, being disorganized leads to incorrect expense classifications which translates into not getting back as much money as you could in the tax season.
But with cloud accounting you can solve your problems:
- Track expenses without the manual effort. For example, FreshBooks automatically connects to your bank account and updates expenses daily.
- Upload expenses to the cloud while on the move through a mobile app. Take a picture of a receipt, upload it, and let the platform do the rest.
- Create better tax records: expenses are stored and categorized in the cloud, so you’re organized come tax time and aren’t losing money. Solutions such as FreshBooks provide tax-friendly business categories to help you.
- Integrates with invoicing: mark any expenses as billable, and it’ll convert to an invoice so that you aren’t losing money.
- Know exactly how your side hustle is performing by pulling expense (and income information) into profitability reports. You can then see what you need to improve on.
Accepting Online Payments to Get Paid Faster
The days of receiving and writing checks are long gone; as are the days of standing in line at the bank to collect payments. To consider how far we’ve come you only have to look at how cryptocurrencies are taking the mainstream by storm. But I digress.
The fact is, with the technology we have today, there’s no reason why you should wait for payment. Use accounting solutions that let you get paid by credit card, directly from your invoice. Not only will you get paid faster, but your clients will thank you for the convenience.
And, for those clients who are still slow to pay invoices, the right accounting software will let you send them a nudge with automatic payment reminders and even late payment fees (if you choose).
2. Invest in Yourself: Refine Your Skills
It doesn’t matter what industry you’re in or what your profession is; you’ll have competition. How, though, will you stand out from that competition?
One way to do this is to invest in yourself and your craft. For example, If you’re a web designer on the side, think of ways you can improve your web design skills.
But don’t only focus on skills related to your craft. Instead invest in many business areas: social media, sales, customer service, accounting fundamentals, and leadership (visit Udemy for access to thousands of short courses you can do in your spare time).
Admittedly, you’re running a side hustle, and you’ll have less pressure to make these areas perform. But if you take even a little bit of time to learn along the way, you’ll set yourself up for a smoother transition should you decide to go full time, or simply be able to take on more ambitious clients (and charge more) in your side hustle.
3. Start Marketing Yourself
You may already have a few clients you can depend on for a constant stream of income. But the chances are that you’re okay with gaps between jobs or just working with clients who conveniently fall into your lap.
In fact, this may be one of the reasons you think you wouldn’t cut it doing it full time. Well, guess what, you can. It’s just a matter of marketing: create a brand, build a website that showcases your work, and ensure your social media accounts reflect your side gig. For example, you could update your LinkedIn profile to show exactly what your side hustle is.
Also, think beyond the online space to how you can connect with local business owners. When you help a few businesses, word quickly spreads, and before you know it, your side gig will be thriving.
Furthermore, start defining your ideal client:
- What work do you enjoy doing and for who? For example, you may enjoy working with small businesses as opposed to larger companies.
- How do you want them to work with you? Maybe you enjoy collaboration instead of working on your own?
- How should they treat you? I’d bet you’d want a client that’s easy to work with, communicative, and pays you on time, right? Write it down, so you know what red flags to look for when talking to potential prospects.
By painting a picture of your dream client, you’ll be better poised to find them and create a value proposition on your website that appeals to them.
4. Learn to Be Your Most Productive Self
Having a side hustle means that you’re doing extra work on top of your existing job. That means that you’ll likely be cramming in extra work in your free time. But, if you’re not careful that can quickly destroy your lifestyle.
You may not notice this at first, especially if your side hustle is your passion. And so, working on weekends may be common. Perhaps, you find yourself doing some photography for clients, or writing a few blog posts for publications you love? The truth is that this is still work, and any work requires downtime to rejuvenate and fuel those creative fires.
For that reason, you should improve your time management by tracking your time. In the same way, you don’t have room for procrastination in your day job, so too is there little room for being lackadaisical in your side hustle.
Tracking time let’s know exactly what you’re spending your time, how much time you’re spending, and where you can make more productive use of it. Ultimately this will help you run a tighter ship and make more money, if you choose. Alternatively, you can kick back and relax.
A side hustle is a fantastic way for you to make to make extra money and get paid for doing what you love.
Although you may have considered turning it into a full-time job, the security of a paycheck is too much to give up.
But that doesn’t mean you can’t optimize your side hustle for success so that if you decide to turn it into a full-time job one day, you’re ready. To do that, prepare for success by:
- Refining your skills in all business areas
- Marketing yourself so that if you transition you’re ready
- Improving your time management so that you don’t burn out
- Investing in business tools such as cloud accounting software to improve your invoicing and expense tracking
One such tool is FreshBooks – yes I’m shamelessly plugging, but I firmly believe that the investment will make your side hustle more lucrative and set you up for success.
FreshBooks is small business accounting software designed for small service-based business. It makes billing painless, simplifies expense tracking, automates complex accounting processes and lets you see how your side hustle is doing at a glance. There’s even a unique time tracking tool to help you manage your time as you juggle two jobs!
Try FreshBooks today. With a free 30-day trial you really have nothing to lose.