By Patrick Young
The time when you could expect a stable, secure job for life has long passed. Self-employment is at an all-time high, and the “gig” economy is the new normal. To survive and, indeed, thrive in 2021 and beyond, workers must embrace the entrepreneurial mindset: If you want financial security, essentially, you will have to secure it yourself.
Here, Get Out of Debt Guy explains how you can start your own side hustle — whether you’re employed or otherwise — and turn it into a thriving business one day :
Identify a need
Needs need fulfilling! Your business idea will define your success: There must be a demand for what you’re supplying. Further, the demand should remain in place for the foreseeable future. The idea doesn’t have to be glamorous or large-scale. Temper your ambition, start small, and plan to scale later.
How do you identify a need? It’s simple: Determine what you’re good at, ask yourself if it’s something you like doing, and check to see if people will pay for it.
Expenses could come out of your own pocket
A side hustle — despite the “side” in the name — will still be a serious investment in money, time, and effort. Needless to say, you’ll be footing the bill initially. To get an idea of how much it’ll cost you, talk to people who are running a similar kind of business or look at blogs and articles online. If you’re going to be freelancing, expect a bare minimum of expenses. If you want to deal in actual material goods, the initial investment will be higher.
Some example expenses include office equipment, stationery, phone and internet bills, gadgets, software, and membership fees for various business-related platforms.
There will be taxes
Depending on how successful your business ends up becoming, you could be looking at hundreds or even thousands in extra tax money. You may have to pay an advance tax or the IRS may slap you with a fine. Further, you will need to save proof of expenses if the IRS decides to take a closer look at your numbers.
It’s important you create a budget and set aside money every month for taxes. To simplify your taxes (and to gain tax advantages), consider registering your business as a limited liability company. If you’re wondering how to form an LA LLC, the easiest way is to work with an online formation service like ZenBusiness.
Plan now and save yourself a major headache down the road. Consider consulting a tax professional if you get stuck.
You’ll need outside help
Consultations with experts bring us to the next point — you won’t always be able to do it alone. You may not have the business skills needed for every task or scenario, and sometimes there will simply be too much work for one person to handle. As such, it’s a good idea to seek help when you need it. You may want to look into taking on an assistant or, better yet, an experienced worker. Of course, you’ll want to vet them accordingly.
When you do hire someone, you will have to pay them. Moreover, there will be tax-related implications. To avoid getting into trouble and just to keep everything running smoothly, you’ll need an organized payroll system.
It will be a long-term commitment
Commit to growing your business. It’s okay if you don’t have everything figured out right now — you’ll learn along the way. Start by setting short-term and long-term goals, evaluate your progress along the way, and keep making improvements. Learn from your mistakes and stay the course.
Getting a side hustle may end up being the best decision you’ll ever make. You’ll grow a lot as a person, win major respect from the people you know, be your own boss, see the world, and maybe make money while you’re at it. Remember to stay positive and believe in yourself. Always keep success — your end goal — in mind and you’ll have the motivation you need to get there.
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