Across the UK, Australia and beyond, the so-called ‘gig economy’ has become a huge part of the labour market. While it has most commonly become associated with jobs such as parcel delivery or driving an Uber, there are lots of ways that working in the gig economy can supplement your income.
Rather than being paid a fixed salary, gig economy workers are paid for the work they complete. It’s become a term that’s frequently used to describe a range of employment types, from short-term contracts to freelance work.
In recent years, the gig economy has generated lots of negative publicity, partly thanks to some unscrupulous businesses using it as an alternative to traditional employment, leading to claims of exploitation. However, there are plenty of reasons why workers do find it attractive.
The rise of the gig economy can provide more flexible working opportunities and a chance to earn some money through a side hustle. And, it’s a trend that has revolutionised the place of work.
Last year, it was estimated that 4.7 million workers were involved in the gig economy either full or part-time. Up to one in seven working-age adults, about 7.5 million people, have worked via a digital gig economy platform at some point.
If you’re looking for ways to make extra money to supplement your income, the gig economy could provide an opportunity. Here’s how.
5 side hustle options
When you think of side hustles there are probably a handful of options that spring to mind. There’s a huge demand for a range of skills, services and products that you could deliver so, you’re looking for a way to make some extra cash, these five areas are worth considering.
1. Selling crafts
Online selling platforms have opened up a whole new market for those that have a creative talent. If you’re artistic, or you enjoy making crafts, selling your products can be an excellent way to generate some additional income.
Selling online gives you plenty of flexibility but there is a lot of competition out there too. Standing out from the crowd and understanding what your target audience wants is important.
2. Freelance projects
There are numerous online platforms where buyers and sellers can meet. Using these portals, you can sell your skills and connect with someone looking for a professional like you.
From graphic design and website development to data entry and blog writing, there’s a world of opportunity when it comes to freelance projects. A one-off gig can deliver a boost to your income and there may be a chance to establish working relationships that lead to frequent projects.
3. Renting assets
There’s been a huge boom in individuals renting their assets to others. You only have to look at the enormous success of Airbnb to realise the potential your home or possessions could have.
While renting out a room in your home has become more common, there are other options that don’t involve letting strangers into your home too. Depending on where you live, there could be a huge demand for parking spaces, your garage or storage space.
And what about assets? If you own a classic car then renting it out for weddings or special occasions could also generate some useful additional income.
4. Tutoring or mentoring
It can take a huge amount of time to develop skills, expertise, and an understanding of a particular industry.
One option when it comes to a side hustle is to put your experience to good use. Working with the next generations of professionals can be incredibly rewarding and provide extra income through tutoring or mentoring opportunities.
Additionally, sports coaching can often pay £15 to £25 per hour. Even working for four hours a week at £25/hour generates £400 a month before tax – around an extra 16% on top of the average full-time salary.
5. Care services
With many people under increasing time pressures and struggling to balance their work and home life, care services are in high demand.
If you’re one of those people who likes tackling a pile or ironing, then there could be money in offering these services, while there is also a growing demand for dog walking and babysitting.
Making your side hustle part of your financial plan
Whether your side hustle is a hobby or something you’d like to develop further in the future, it’s important to make it part of your wider financial plan.
One of the first things you should consider is how your side hustle could affect your tax liability. If your total UK income for a tax year is less than £1,000 you usually won’t have to declare this as you benefit from the Trading Income Allowance.
However, if you earn above this figure, you will usually have to register as self-employed with HMRC and fill out a self-assessment tax return. Your earnings will be classed as income and be taxed as such. It’s worth keeping in mind tax thresholds and how earnings from a side gig could push you into a higher tax bracket.
You should also consider how you want to use your additional earnings. Whether it’s to boost disposable income or help you to save for the future, making it part of your plans can help keep you on track.
Get in touch
If you’re looking for trusted, professional advice on how to manage your finances and plan for the future, we can help. Please get in touch or call (01372) 724 249.
Please note
The Financial Conduct Authority does not regulate tax planning.
