How to Manage Your Full-Time Job and Side Hustle Finances
Full disclosure here: I love my full-time job! I have worked at a ministry as a volunteer coordinator for the last three years. The ministry serves a very diverse neighborhood where over 25 different languages are spoken and I absolutely love connecting with residents and volunteers. I have no immediate plans to leave my job. As a matter of fact, my plan is to continue working there until retirement, God willing.
But...I also love my business! My business allows me to be creative and I’m able to transfer my job skills to my coaching business.
According to the Bureau of Labor Statistics, almost 45 percent of Americans have a side hustle. Man, that’s a lot of folks!
In this post, you will learn the five things you need to do to responsibly manage your full-time finances to fund your side hustle.
So here’s the big question: should you quit your full-time job to work your side hustle?
I always coach my clients to never to leave one job or business before their new venture is successful and bringing in money equal to your job. I believe you can use your current day job as a springboard to your new venture if it is done right.
So, let’s dig in: what are the 5 things you can do to successfully fund your side hustle with your full-time gig?
Track your expenses using a program like Freshbooks or Wave.
Working a side hustle and a full-time job is going to be taxing on your time. To make it all work, I wake up super early, I work through my lunch break and I work on Sunday afternoons. Those times are spent mostly creating content and working with coaching clients and not mundane administrative stuff, like bookkeeping. Save your precious time by using software to track your expenses instead of using spreadsheets. I'm a huge Wave fan because it's so simple to use and it gets the job done.
Open a business or checking account.
The key here is to keep your money separate. Your full-time job is hopefully taking out taxes but you’ll need to set aside money for taxes on your side hustle income. If you have a bank, open a business account or open an online banking account (Ally is a good option). Open a business credit card account to easily track your business expenses. Don’t skip this step!
Keep good records.
You’ll make your life a lot easier if you keep good records. If you’re already in the habit of tracking your earning and spending your personal expenses, then you’re ahead of the game. But let me tell you - tracking your side hustle expenses is going to be critical. Tracking your expenses can actually save you money. How? At tax time you’ll be able to easily claim any eligible expenses against your side hustle income - things like business cards, courses or conferences. Plus, you want to make your accountant’s job easy, right?
Invest in your business
The way I’ve handled it this year is that I set aside a 20 percent of my earnings from my side hustles to cover my expenses and invest back into the blog. For example, I use that money to pay for Tailwind, a Pinterest scheduling program, because about 75 percent of my website traffic comes from Pinterest. It makes good business sense to invest in a scheduler that saves me time. I’ve also used my side hustle money to buy a new computer and for courses.
Since we’re talking about putting money away, let’s chat about taxes for a moment. I know, that’s a favorite topic, right? But it’s something we need to do.
Use this calculator to figure out how much you need to set aside to pay your taxes. You do not want to get hit with an unexpected tax bill. You can also talk to an accountant if you’re totally unsure.
And last but not least - treat yourself!
After you have handled your business, do something nice for yourself. Use some of your hard-earned extra money to buy something that’s just for you. I enjoy British television and each month, I treat myself to a BritBox subscription and then spend one weekend per month just vegging out on British sitcoms and documentaries.
So, are you ready to make the transition from employee to business owner? As I mentioned before, I do not suggest pulling the plug on your full-time gig just yet. I suggest having at least three months of expenses socked away before leaving your full-time job.
Here are a few other tips:
Gradually slip out the door rather than just quitting. What does that look like?
Negotiate shorter hours.
Sit down with your monthly budget and your anticipated side gig income and ask yourself exactly what you’ll need from your employer.
How much money will help you keep your bills paid?
Would you rather work half-days throughout the week or work a few full days so you can take other days off?
What are you willing to give up? Because here’s the deal: something’s going to have to give to make this all work. Will you work through your lunch break a few times per week?
Just make sure to come up with a solution that works for you and your boss. Think about your employer for a second: are there any issues your boss might have with you having a side gig? Be proactive and think of any potential problems so they can be addressed.
And reassure your boss that your side hustle won’t get in the way of your job. Those simple words can go a long way.
Are you ready to talk to your boss about this but don’t know what to say? Try saying this:
I love my position here. I also have a side business and would love to devote some time to that also. Would it be possible to come in one hour late three days per week? In exchange, I’d be willing to give up my lunch hour to make up the time.
Simple, right? Don’t ramble on and on. Get to the point.
Should you go into detail about your side hustle?
It really depends. Are you on good terms with your employer? If you spill the beans, do you run the risk of getting fired? I’d say if you’ve got a good relationship, then why hide it? My boss and co-workers all know about my side business and have been extremely supportive. But only you know your own situation so you’ll need to trust your gut on this one.
Some things you can do to manage it all
Between working the full-time job, managing my business, children, and church activities, my time is at a premium. I’ll be the first to admit that sometimes I don’t manage things so well. That’s usually the case when I don’t have a plan and I’m flying by the seat of my pants. But when my plan is on point - watch out, world! Here are a few ways I manage to get things done:
Batch tasks together
The boys like hot meals every day but hey - sometimes I just don’t feel like cooking, you know? Nothing annoys me more than walking in the house after working all day and having to rustle up something for dinner. Ugh! To avoid all that late evening drama, I now cook a week’s worth of meals on the weekends, put them in my trusty Tupperware and boom! Hey, they know how to use the microwave. Same thing with writing. When I get on a roll, I usually crank out several pieces on the weekend or early morning. That way, I have content ready to roll and I’m not rushing at the last minute to come up with something witty.
Letting things go and delegating was a hard thing for me to do. Hey, I’m used to doing everything myself, right? But then I realized I was wasting valuable time doing things I could easily outsource. Instead of me proofing content or formatting ebooks, I have a virtual assistant to do that, allowing me the time to work my full-time job without feeling guilty and worrying about getting it all done. I use schedulers, like Tailwind and Buffer, to schedule content, usually on Sunday evenings. Yes, outsourcing to people costs money but I figure it this way: I’m actually saving money by handing off the task. Definite win/win!
Take time for yourself
It’s easy to keep pushing yourself to get it all done but the truth is you’re on the fast track to burn out if you don’t take a break. Hustling doesn’t have to be hard. Hustling should be strategic. You don’t have to prove something to anyone about how hard you’re working. We see you, boo!
Keep a schedule
I schedule my side gig tasks into my calendar. That way I’m being held accountable and I’m less likely to cancel. Make a schedule and stick to it.
Get an accountability partner or join a mastermind group
I went back and forth about joining a mastermind group. Honestly, I didn’t see the value in joining one and my preconceived notions about them weren’t very pretty. Well, a few months back I was feeling a little off balance. I had a lot of ideas in my head but I was having trouble putting the pieces together. Sound familiar? I knew if I wanted to move my business forward, I needed some help.
I joined a mastermind group of women bloggers and let me tell you, it’s just what I needed. These women have pushed me to check things off my list, given me feedback on content and have been my cheerleaders. If joining an online mastermind group isn’t your cup of tea, find your cheerleader (accountability partner). Tell them your goals and ask them to check up on you on a regular basis to make sure you’re on track.
Here are a few resources I use to manage my expenses. Plus, I’m giving you access to the yearly income planner, where you can plug in your side hustle’s hourly rate and figure out how much you need to make.
- Do you want to launch a business but don’t have a clue where to start?
- Have you tried everything to grow your existing business but nothing is working?
- Are you tired of piecing together various resources into a so-called strategy and not seeing results?
I’d love to chat with you. Just head over and schedule a free consultation.