Here’s the thing: side hustles are omnipresent in the personal finance world. Consumer debt, bad. Side hustle, good. I get it. You get it. We all get it. But if you don’t have a purpose for your side hustle, your side hustle won’t save you.
Long before I ever stumbled across a personal finance blog, I decided to pick up a side hustle. I am a private tutor. Visit any public library after school ends on any given weekday (or weekend – if a student is really swamped with homework or majoring in procrastination), and you’ll see us. We’re the people balancing 17 different books, three bags, a laptop, a tissue box, and maybe some form of family-approved bribery* in desperate search of a place to sit. Even though we might look a little haggard after a full day of teaching and supervising extracurriculars, we slap on a smile and get down to business. Since we’re almost always occupying the exact same spot at the exact same time with the exact same student every week, the private tutoring community is fairly close knit. We know each other. And I know that at least one of my Kleenex-offering, flashcard-making, paper-editing comrades-in-arms is wasting her time. Here’s why:
Treat Yo Self Mentality
There’s been a lot written about lifestyle inflation that happens after a promotion or a bonus at work. Sadly, it’s easy to get caught up in the “spend more” mentality once your side hustle takes off. Case in point? One of my fellow tutors.
She started tutoring in the afternoons because her middle-school daughter is able to work on her homework with help from all the resources the library has to offer while Mom earns some extra money for the family. It’s actually a brilliant plan. The problem is they both show up with venti Frappuccinos from Starbucks and assorted dinner items from Chipotle, Potbelly, and the like. I figure this sets them back an easy $20-$30. So what? It’s an afternoon pick-me-up, a convenient meal on the go, and she’s making money.
Or is she? Most tutors in my area earn $30-$50 an hour. This particular tutor sees one or two clients an evening. While I don’t know her actual rates, my hunch is she’s pocketing anywhere from $30-$100 a night. That means she’s spending anywhere between 30% and 100% of her side hustle before that money even makes it to the bank. It’s certainly fine to splurge on yourself occasionally, the biggest way to treat yourself is to do your future self a favor by opting to save, not spend.
Here’s where every personal finance blogger in a hundred-mile radius lets out a groan. I started side hustling to pay for my wedding shoes. I know, I know. I’m awful. But I had made up my mind that my dad and Jimmy Choo were walking me down the aisle, so I devised a plan to make it happen. And it did.
What’s even more silly than side hustling for shoes? Not side hustling for any reason in particular. The aforementioned fellow tutor has remarked to me on multiple occasions that she doesn’t even really know what she’s doing with the extra money or where it all goes. The problem with not knowing what you’re doing with your money is that not only are you more likely to not spend it wisely, but you probably also don’t even know how much money you’re making to begin with.
Even if it’s inconsistent income earned on the side, it makes sense to have a plan for your money. In addition to spending one month wedding-shoe-hustling, I’ve used my side hustle to fund more sensible short-term goals like:
- Home repairs – Let me tell you. Side hustling for Jimmy Choos is way more fun that side hustling for a new AC unit.
Now, I’ve decided to reroute that income once more. This school year, I’m going to put all of my side hustle money towards paying down our mortgage. After all, it only makes sense to want to own the closet free and clear that those Jimmy Choos live in.
*Stickers or Jolly Ranchers, anyone?
**Hello, Pot. My name is Kettle.
So Tell Me…What do you do with your side hustle income? Can you think of any other mistakes people make with their side hustles?