Understand Your Finances
Why you should have a side hustle—and how to get one
This story is part of The Pivot, an original series about how people navigate the age of episodic careers. It is presented by Chase.
A couple years ago, Sherry Miotke started making beautifully decorated treats mainly as a side business, all while working as a full-time server and manager at a relatively high-end restaurant in Salem, Oregon.
"I was always intrigued by the idea of edible art, especially after all the cake decorating television shows began to take off," Miotke recalls. She never expected to make cake decorating a career. "It kind of blossomed after I saw some of the cakes people displayed at the state fair."
After Miotke volunteered to decorate a store-bought cake for a friend's birthday, her passion for artistic cakes soon grew into a healthy side hustle, and most recently, her full-time business.
Cultivating a small business outside of a regular job is no longer unusual—especially in the age of episodic careers. Nearly one-third of US workers report having a side hustle, according to a CareerBuilder survey. Side hustles help diversify your income, build new skills and offers outlets to explore passions.
It's okay to start small
The beauty of a side gig is that it doesn't have to be an all-consuming endeavor—especially at first.
Initially, Miotke didn't advertise or seek orders. "It was all word-of-mouth," she recalls. "I was working out of my kitchen at home, and still working 40 hours at the restaurant."
Likewise, Rich Conklin's small website design and development business blossomed after he helped his wife create a website for her own company. As the shipping and logistics lead for an aerospace company outside of Portland, Oregon, coding websites wasn't initially in his skill set.
"I started learning HTML, CSS, Photoshop and Wordpress to help my wife out," he says. "The feedback from her website was very positive. Next thing I knew, I was being asked to help another small business, and then another."
Conklin and Miotke both took the initiative and invested the time to develop their skills, offering up their services for free at first, simply to gain experience, until a hobby became a viable side hustle.
Prioritize your time
When you're working a 40-hour weeks, carving out additional time for another business may seem like an impossible task. Miotke used to squeeze in conversations with potential bakery clients on her breaks, meeting them at a Starbucks near her restaurant. She'd bake cakes after her shift ended, at midnight, often staying up until the wee hours of the morning. "Fortunately, I love what I do, so it didn't seem like a chore," she says.
Conklin has taken on regular freelance clients for years, often setting his alarm for 3 a.m. to log in a few hours of web design work before he left for his main job. "Then I'd get home at 4 p.m. and pick up where I left off," he says.
It wasn't easy. In the beginning, he often found himself overwhelmed by the amount of work, especially when small projects ballooned into much bigger endeavors.
"I had no idea what 'scope creep' was," Conklin says. "I'd say yes to everything. Now, I spend a lot of time upfront defining the project requirements and writing up exactly what was agreed to."
Calculate the costs before you start
As with any new business, side hustles have startup costs. Conklin advises that you determine what "tools of the trade" you'll need before you begin—whether it's a laptop and new software, bakeware, art supplies or something else. Miotke, for example, made her early cakes using baking pans she got from her mother-in-law.
"Then for each new cake order, I'd go buy the rest of the equipment I needed to complete," she says.
There are also some nuts-and-bolts costs all business owners encounter: you may need to apply for a business license, for instance. (The fees vary depending on what you're doing and the rules in your state.) The money you earn will go towards your taxable income, so you'll need to track your expenses, sales and profits carefully and pay any extra taxes owed. Creating a separate business bank account can make this easier. You can also set up a spreadsheet to record expenses, invoices and more or use bookkeeping software.
Be sure you want to take the leap
Not every side gig transforms into a full-time business—and that's not always the goal. Conklin has built his freelance website design enterprise alongside his day job for 12 years.
"Although I love the web design work, and the flexibility, being self-employed full time brings another level of considerations that I would want to make sure I'm prepared for," he says. He'd have to consider things such as how he'd obtain health insurance, or whether he would need or want to hire employees.
For Miotke, the decision to take her side hustle full-time made itself clear.
"I got to the point where it was hard to balance both jobs," she says. Eventually, she was laid off from the restaurant. And she decided to fully devote herself to the cake business. She found a space for her bakery, attended a bridal show and booked an entire summer of weddings.
She hasn't looked back. "I sometimes have to pinch myself that I get to do this," she says. "I can't believe that I own my own business."
Kelly Kearsley is a Chase News contributor. Her work has been published by a number of news organizations, including The Wall Street Journal, CNN Money, Money Magazine, and Runner's World.