Nearly 4 in 10 Americans (37%) have a side hustle according to a 2018 survey by Bankrate. Now this survey includes part time side jobs, gig economy workers like Uber drivers, and side businesses, but we really focus our training and attention on those entrepreneurs that are starting side businesses.
See how we define “side hustles”.
We think there are a lot of good reasons to start a side business, here are our top 3:
Let’s dig a little deeper into each of these reasons why we believe starting a side hustle can be a great idea.
According to a study by the Pew Research Center Americans real wages after adjusting for inflation have effectively been stagnant for 40 years.
If you get that 3% raise each year, but just don’t feel like you can ever get ahead, if it feels like that raise is just eaten up by ongoing expenses, you aren’t alone. Inflation in just two categories (Healthcare and Higher Education) could probably eat up most of your raises over the last four decades.
So if you are looking to truly increase your purchasing power, not just your income, then starting a side hustle might be your best change at “getting ahead.”
According to that Bankrate survey we referenced earlier, the average monthly income that survey respondents make from their side hustle is $686.
Here is a distribution of the additional income earned.
An additional $8,232 per year for 10 years invested and compounded at a conservative 5% annually will give you $122,127 after 10 years. You might be able to send a kid or two to college with your side hustle, or even retire a few years earlier than you would have otherwise.
If you want to play around with your own numbers to calculate the potential that your side hustle could have, you can use this free compound interest calculator from MoneyChimp.
The additional income that is made possible through a side hustle is a significant benefit, but side hustles can also give you flexibility and optionality which can provide a lot of non monetary value.
A side hustle can:
The options and flexibility that a successful side hustle can provide is a significant benefit.
Finally, a major benefit of starting a side business is the potential upside. Your side business might not stay a small, side hustle forever. Side businesses often turn into full time businesses and can even turn into large businesses employing many people someday. According to Business Insider the following major companies all started as side hustles:
Collectively these companies are now valued at well over a trillion dollars. Big businesses always start out as small businesses and oftentimes as side hustles. In addition to the additional income and flexibility a side business can provide, it can also come with a significant upside that you are able to build a business that can scale and create significant value for you over time.
If you are convinced that now is the time to take the next step in launching your side hustle please check out our courses at Side Hustle University and get started today!