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Starting a side business is all the rage, isn’t it ?
But what happens when you have successfully start a side hustle and have earned your first $1000 ?
I surprisingly struggled with this question when I first started making meaningful money with my side hustles.
Here’s the reality : if you don’t decide how you are going to spend your extra money before you earn it, you will squander the money and end up at the same spot you were in when you didn’t have that extra money.
It is the reason why athletes who earned millions of dollars go bankrupt.
And so in addition to me telling you to start a side business with your skills, I am also going to tell you that you need to PLAN what you will do with the money you earn from it or else, you may as well have never started in the first place.
10 Things You Can Do With Your Side Hustle Money – Once You Earn It
Pay off debt
I hate debt.
I have a bad allergy to it.
So I avoid it at all costs. It took me a while but once I realized I could make 3-5 times the minimum payment on my credit card payments because of my side hustle, I began to do that and saw my credit jump 35 points in just 3 months. Extrapolate that over 12 months and you could increase your credit score by over 100 points by simply paying more each month so you can finally live debt-free.
Start an emergency fund
Ever had your car break down at the most importune time of the month ?
Unexpected expenses are bound to happen sooner or later.
Being prepared for it is wise.
One of the things I pledged to do this year was to start a $1000 emergency fund.
That goal sounded so audacious because even though I was making extra money with my side business I had never saved up even $100.
I will tell you this : once you save up $1000, a $5000 or $10,000 emergency fund will no longer look so daunting.
Save for the children
College costs are only going to soar over the coming years.
It’s never too early to start saving for the future educational costs of your children with the extra money you are making.
I highly recommend looking into 529 savings plans if you live in the United States.
Save for retirement
Personally, I plan on never retiring from doing meaningful work.
However, in our older years, the truth is that we will not be able to work as hard as when we were young.
Hence, it is not a bad idea to start thinking about putting some of that extra money away for retirement.
Fund home renovations with cash
Remember my great disdain for debt ?
Yes. Well, it spills over into other areas as well.
Instead of taking out a second mortgage on your home for some much needed repairs, how about funding it with cash from your side hustle so you don’t owe anybody extra money ?
I must confess that I am not at this level yet, but as my business grows, I am beginning to look into investing opportunities.
We are supposed to be making our money work hard for us right ?
Invest in your own learning
Anyone who enjoys any level of success is an avid learner.
I learned that from my dad and I am discovering it everyday as I have conversations with people more successful than myself.
This year for instance, I can say without a doubt that investing in courses like Earn More Writing and Making Sense of Affiliate Marketing and more recently attending Fincon have been instrumental to increasing my income.
Investing in your learning cannot be indiscriminate , however.
You have to know what your goals are.
When I started my business journey, I did not know what I wanted. I bought everything I could afford that I thought I was interested in.
Five years on, I am older and wiser and have gotten clearer on what I want to do.
This has been helpful to me when it came to honing in on the experiences/courses I wanted to invest in for my personal growth.
So get clear on what your goals are and then use your extra money to invest in those experiences that will help you reach your goals faster.
Invest in better tools
Apart from investing in your education, investing in better tools to help you move your business forward is another way to use the money you’ve earned side hustling.
Earlier in the year, I jumped from using Mailchimp to ActiveCampaign because I wanted more out of my e-mail service provider.
I also jumped and invested in Thrive Landing Pages (now Thrive Architect) because I wanted to be able to build nice, functional landing pages for my products and e-mail opt-ins.
More recently, I jumped from using Fatcow to using Siteground as the hosting company for my website.
If you are a video person, you may jump into buying some newer vlogging equipment.
Whatever tool you need to be better at your online business, you can use your side hustle money for that.
Donate to your favorite charities
Want to be able to support your church or favorite charities more ?
Side hustle money got you covered here as well !
I believe in the fact that giving more opens up opportunities to receive more.
Do something to reward yourself
Okay, so now that we have invested in our learning, in better tools and even in others by giving to our favorite charities, how about rewarding ourselves ?
Take the trip.
Indulge in a local experience you have never done.
One of my personal faves : going to to spa to get my nails done for $20.
I could not do that prior to my side hustle.
Now that I make way more than $20 from my side business, you bet I am going to indulge those $20 to get my feet all glammed up and feeling fresh.
You deserve it.
Knowing what to do with extra money and laying out a plan for those actions before you start earning money with your side hustles is wise.
I did not learn it until almost a year into me side hustling but I know better now – and if you are just starting out, you are now 10 times wiser than I was two years ago.
I will be thrilled to hear your thoughts in the comments !