If you're wanting to start a profitable side hustle right now but you have limited funds and just don't know how to get started, you're gonna love this post!
No matter whether you think you have a skill you can monetize or want to start a side hustle to start a travel fund, your side hustle needs to be profitable. Otherwise, what's the point?
A profitable side hustle starts to open doors. I will help fund your dreams and help you discover what you're really good at, what you're passionate about and may even help you make a career change.
But before we get to that, let's look at the ingredients it takes to have a profitable side hustle business.
Five Steps to a Profitable Side Hustle
Step #1: Identifying Your Skills
You’re probably hyperventilating now, right?
This is the part that you’ve been the most scared about, because you’re thinking to yourself, “I don’t have any skills that I can start a side hustle with…”
In fact, it's the main reason you haven't started anything yet.
Well, I call bullshit on that!
You, my friend, have a lot more monetizable skills than you give yourself credit for, and I'm about to show you how to discover them.
After running through the main ingredients I'm sharing with you in this post, you'll have more than one skill that you could start a profitable side hustle with.
It's time for Action Jackson!
Grab a pen and paper (or whatever way you take notes). You need five individual pages for this exercise.
- At the top of page one write “What skills am I trained in?”
- On page two write, “What are my hobbies?”
- On page three write, “What am I really good at?”
- On page four write, “What do my friends, family, and colleagues ask for my advice on?”
- And on page five write, “What’s something I’ve struggled with and moved through or what’s a problem I’ve had that I’ve solved?”
Now, find a quiet place and answer these questions for yourself. No overthinking this. Write the first things that come to your mind when you read each question.
It’s really important that you don’t censor yourself during this exercise. It’s for your eyes only, so don’t hold back.
Now get to it! Set a timer for 30 minutes and have at it.
Once you've done that piece, it's time to narrow in on your side hustle ideas.
Using those five pages, you’re about to uncover a side hustle that might be the best one to get started with.
It's Action Jackson time!
I want you to take those five pages from the exercise above and find the top three skills from each page that meet the following criteria:
- A ‘top 3' skill is one that you could do blindfolded, i.e. You don’t need any further training in this skill to be able to do it
- You enjoy doing this skill or it comes naturally to you
- You have access to all the tools and resources you’ll need to be able to effectively do this skill. For example, if you’re a graphic designer, you’ve already got a copy of Photoshop, etc.
So using the five pages, go ahead and find those top three skills and then rank those top three skills from 1-3, with #1 being the one you like the most, and #3 being the one you like the least.
For example, say you had the following skills identified as your top three skills from your day job:
- email writing #1
- creating social media graphics #2
- managing social media engagement #3
The next thing you do is rank them from 1-3 in order of which you like the best to least. So #1 is best, #3 is least.
Got it? Let's move onto the next step.
Step #2: Are Your Skills Viable?
Wahoo! You’ve got yourself a nice little list of skills to work with. Now what?
Now we find out if any of the skills you’ve narrowed in on are going to make you some money! Remember, the goal is to find skills that will allow you to create a profitable side hustle, we're not doing this just as a hobby.
It's Action Jackson stations friends!
Using the skills you identified from the previous step, run them through the following exercise so we can figure out which one will bring in the most money:
- If your skill is predominantly online, i.e. you need a computer to complete any gigs that come your way, then start by checking out freelancing sites like Upwork.com and Freelancer.com — both of these sites have a job search bar. Start there.
- Using the job search on these two sites, type in each of your skills and see what gigs come up. If you’ve got over a page full of gigs, then it’s safe to say that your skill in high demand and it’s gonna make you money. But let’s take it one step further, just to be sure.
- Let’s check out some niche sites, ones that focus more on a group of similar skills than on every possible freelance skill available. The easiest way to do this is to do a Google search. Search your skill + jobs and add “freelancing” before your skill. So if you’re a web designer, your search would look like this: “freelancing web designer jobs”. Note down how many options come up. Focus on the sites that are niche specific. For web design, I found a site called www.project4hire.com. Again, if there are a number of jobs (5 or more) on that site that match your skill, it’s a great sign that your skill is viable and profitable. Keep a list of these sites for future reference.
- Don’t stop there. Check out your local community center notice board, local newspaper classifieds and any other places you’d go to connect with others locally. If you see people asking for your skill or advertising your skill in these places, it’s a good bet that your skill is in demand.
This exercise might take more than 30 minutes to complete, but it's worth it.
Dig as deep as you can to find the sites that need your skills, and make sure you keep a note of them. Write them down in your notebook or store them in a Word doc, Google doc or in your Evernote notebook – whatever works for you.
Take the time to do this exercise and validate those skills. Time spent here saves you making a mistake further down the track.
Step #3: What Are Your Potential Earnings?
How are you feeling? Did you find at least a few of your skills were viable?
If you DIDN'T find any of your top three skills (the ones you identified back in Step 1) were viable, then go back to Step 2 and run ALL of them through the previous exercise.
If you did find viable ones, then you're ready for the next exercise.
The next step is to assess what your potential earnings are going to be. This is especially important if you're planning to transition out of your full-time job into a full-time side hustle.
You want to make sure that you know what you're going to be earning before you go all in.
It's time for Action Jackson!
Using the viable skills you identified in the previous step, I want you to now look at what your potential earnings would be for each of those skills, based on the following formula:
Average Hours Worked per Month (x your current wage + 10%) + Monthly Overheads/Average Hours Worked = Hourly Rate
Once you've got your hourly rate, go ahead and run some numbers based on different hours you might work.
On average, most people who are working a full-time job can dedicate 10-20 hours per month to a profitable side hustle.
If your side hustle is simply a means to an end, ie, you're using it to fund your travels, then aim for 10 hours per week.
If you're looking to go full-time in the future, then 20 hours a week is more realistic.
Let's look at a couple of examples.
First, let's work out your hourly rate based on an average of 20 hours worked per week.
- Your current wage = $15 + 10% = $16.50
- Average Hours worked per month = 20
- Monthly Overheads = $110
Using the formula above, we might get something like this:
$16.50 x 20 ($330) + $110 / 20 = $22 is your hourly rate
Next, you’ll need to factor in tax here as well. This is not included in the example above. Tax will be dependent on your country and state, so make sure you find out what those are as well and factor those into the equation.
Let's say you want to earn an extra $1000 per month. Based on an hourly rate of $22, you'd need to work approx. 45 hours each month in your side hustle.
You can play around with the figures to see what your potential extra earnings will be. Don't forget to factor in tax.
You should seek the expertise of a qualified accountant with regards to tax if you're not sure of your requirements.
This part of the process is exciting — because it gives you an opportunity to see exactly what you could earn outside of your J.O.B. and if your side hustle is going to be worth starting, as far as your goals and time are concerned.
Step #4: Choosing Your #1 Side Hustle Skill
Congratulations! You’ve now identified that you’ve got some viable and profitable skills to work with. Now we get to the pointy end of the stick — it’s time to choose just one of those skills.
I'm sure by now you have a much clearer idea of what skill you're going to start with, but if you're struggling to choose, this exercise will help.
It's time for Action Jackson!
Out of the list of viable skills you've validated, eliminate the ones you don't really enjoy doing. Start with eliminating any skills you've given a rank of three.
Next, make a decision between those you've ranked at 1 and 2 on each list – the aim is to reduce the list down further so you've only got a maximum of five to choose from.
Now you should be left with the skills you gave a rank of #1.
Looking at these skills, which one do you like the most or could do blindfolded?
PRO TIP: It’s important to note that if you’re going with a skill that is the easiest for you to do but isn’t something you necessarily enjoy doing, then keep the following in mind: The side hustle that you start with doesn’t have to be the side hustle that you stick with forever.
Now you should have chosen your ideal profitable side hustle.
I’m not saying that you’ll never be able to do anything with those other skills you eliminated but to start a profitable side hustle quickly, make it easier on yourself and focus on starting with one.
Enjoy the process and don't throw away your lists… keep those for the future. You never know when you might want to start a new side hustle!
Step #5: Find Your First Client/Customer
The final step in this process is to find the right clients/customers and projects to work with to help you achieve your first income goal of $1,000 per month.
Not all clients and potential customers were created equal though.
You need to make sure they are legit and that they are going to pay you what you're worth. This is why it's extremely important that for your first few jobs, you work with sites like Upwork.com or Fiverr.com.
Now I know that these sites typically pay on the lower scale, but I'm not suggesting you stay here forever, just for your first 2-3 gigs. Once you've got a few under your belt, then you can find sites and customers who are paying for quality work.
Set your profile up on one of these sites and get going.
Your immediate action step is to start at step 1 above! Write down everything you do, everything you're good at, everything you're asked for advice on and everything you're trained in.
Then complete the next step.
By this time next week, you could be well and truly on your way to having a profitable side hustle. All that's left to do is take action.
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