How to Manage Money from Your Side Hustle
Full-time, 9-to-5 jobs generate steady income that’s easy to predict and track. If you decide to pursue your passion and turn it into a side business, you’ll have extra money coming in each month. Having multiple streams of income isn’t a bad thing, but without proper management, your personal finances could become disorganized. Be smart about it and—who knows?—maybe your side hustle could become a full-fledged business one day.
Open a Separate Bank Account for Your New Income
This tactic offers a few benefits. First, having a separate checking account for your side hustle income makes it easy to track how much money you’re bringing in outside of your regular day job.
The account also creates a clearly defined pool of money that you can put back into growing your side hustle without dipping into your regular income. This provides peace of mind that you’ll never accidentally spend more on the side hustle than what it’s generating—no accounting effort required.
Maintain a Spreadsheet
Whether you keep your side-hustle money in a separate bank account or not, it’s wise to track your incoming and outgoing funds in a spreadsheet, especially if you have multiple income streams apart from your steady paycheck. As your side hustle grows, the information in your spreadsheet will help you realize when you start earning more money per hour pursuing your passion than working at your day job. Once you reach that point, it may be wise to siphon more hours into your side hustle.
Grow Your Side Business Slowly
There’s more than one way to turn a side hustle into a main hustle. One option is to funnel money into it from your regular income, as well as from personal loans and lines of credit. This helps your business grow more quickly, but you should still be wary of taking on unnecessary debt. Another option is to keep your day job to pay for necessities and only reinvest money from your side hustle to grow it slowly and steadily.
Perhaps the best option is to implement a combination of these tactics, learning to live frugally as the income from your side hustle grows more and more. One day, it may become your full-time focus, and you can drop your day job altogether. It’s a gradual process that requires careful planning, but with the right money management techniques, you can do it!
GCS Credit Union offers checking accounts, personal loans, and lines of credit to help you manage and fund your side hustle. To learn more about these options and the benefits of banking with GCS, please call us at (618) 797-7993 today.