What to Consider Before Setting Up a Side Hustle

*This is a collaborative post on things to consider before setting up a side hustle

In the UK, millions of people are starting small businesses to earn an income alongside their full-time jobs. The side hustle allows us to make money out of our skills and diversify our income so that we’re more capable of absorbing short-term financial shocks. In some cases, a person with a side hustle might go on to turn that venture into something full-time!

If you’re looking to start a side hustle, there are a few considerations you might make beforehand. These will allow you to get the most out of the venture and avoid more expensive and stress-inducing mistakes.

Preparation makes perfect

The side hustle isn’t a game for improvisers. The more preparation you put in, the better the results you’ll enjoy. Think about what you can contribute and what the market wants from you. Then start putting the elements into place.

Assessing your skills and interests for a side hustle

So, exactly how do you go about deciding what side hustle you’re going to develop? Often, the answer to this question might be obvious. If you have a burning passion or a lot of experience in a particular field, then you might plan the side hustle accordingly.

Blogging, online tutoring, crafts, commodities trading, and voiceovers—these are just a few of the niches you might be tempted to occupy.

Conducting market research

Knowing things that you can do well is just one part of the equation. You’ll also need to figure out what people are willing to pay you to do well. Look at your target audience and analyse your would-be competitors. Do you think you can do a better job? It might be time to test that theory!

Formal market research will help you save huge amounts of time and money in the long run. Taking it seriously could spell the difference between the success of your business and its failure!

Legal and financial considerations of having a side hustle

Before you get started, you’ll need to know what you’re obliged to do. What laws do you have to abide by? What taxes will you have to pay? What happens if disaster strikes?

In the UK, you may be obliged to register your business. You’ll have to pay tax on your income, and any profit you earn from the same commodities. In some cases, you might need a special license to perform the service you’re offering.

You might invest in specialised insurance to cover some of the risks.

For example, if you’re in the automotive business, you might look at part-time motor trade insurance to protect your business. This way, you’ll be covered against the kinds of risks unique to that industry.

Time management and work-life balance

One of the major advantages of a side hustle is that it won’t eat into your main career. But there’s also the potential for your side hustle to eat into your leisure and family time. Getting ahead of this problem means managing your time effectively.

The Eisenhower Urgent/Important Principle is often a great way to allocate your time. It’s based on a speech given by Dwight D. Eisenhower and divides activities into two categories: Important activities are those that help us towards our goals, while urgent activities often further someone else’s goals but require our time immediately. You can use this distinction when deciding how to spend any given hour.

Marketing and promotion for your side hustle

Growing your side hustle and eventually making a full living from it means putting the word out there. Use social media to let your audience know who you are and encourage your happy customers to spread the good news through word of mouth.