With people finding more time to develop their skills during the pandemic, and now inflation putting the squeeze on incomes, finding a nice little earner is more attractive than ever.
And with so many social media influencers promoting quick and easy 'side hustles’, it’s easy to assume that creating a second income is even easier than ever too.
But, as is so often the case, the reality is not quite as straight-forward as the dream.
What do you mean by ‘side hustles’?
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It’s really any way of making money outside of your day job – though it tends to be less formal than a "real" job.
Generally it’s more about working on a project, or selling items or services on an on-demand basis.
It’s essentially the Gen Z version of the nixer. And, like a lot of Gen Z things, it’s often very online-based and focused on either selling through digital platforms, or selling digital content in some form or another.
A lot of the hype around side hustles is tied to the rise on social media of this very American attitude of ‘the grind’, This is where people are encouraged to be entrepreneurs, to try to find a way to make a profit at every opportunity, and ensure that there’s not a minute that goes by that they’re not adding to their personal wealth.
As a result, social media is full of content explaining to people the five or ten side hustles that they can get involved in, which will generate income for them.
Needless to say, these things are always put across as easy to do, and very lucrative.
You’ll also often hear the term ‘passive income’ being thrown around. This is the idea that you can set up a side project and it will just start to generate money for you, with you having to put any time or resources into maintaining or managing it.
So it’s a very attractive pitch – not just because of the money that it’s claimed you can make, but also because it’s often sold as low-effort, and very creative, too.
So what are the kind of ‘side hustles’ that people are being told will make them loads of money?
There are lots of different schemes and methods that are being sold as side hustles at the moment.
But you can, roughly, break them down between those that are based in the real world, and those that are purely digital.
A lot of the digital ones have only really become possible in recent years, thanks to the growth of various platforms that allow people to create, publish, or sell items to the world.
And, in theory, a lot of these have fairly low barriers of entry too.
So, for example, some common side hustles centre around graphic design – maybe making art that people can buy as digital prints, or maybe even a design on a t-shirt or a badge.
Nowadays you can buy some pretty powerful design software for a couple of euro – as opposed to the hundreds or even thousands of euro you would have had to spend on something similar a decade or more ago.
And then, when you have your design, it costs you nothing to list it on the likes of Etsy, or to make it available on an on-demand printing service.
That means that the item is only made when someone orders it, so you don’t even need to invest in stock that you then have to try to shift.
And this ease of entry applies to many other types of digital side-hustle that people talk about – for example podcasting, blogging or becoming a YouTuber or influencer.
It costs nothing to publish content online today – and if you build up a decent audience doing so, you can suddenly start making some fairly decent money through advertising, and paid partnerships.
Back in 2020, a nine-year-old called Ryan Kaji earned almost $30m from his YouTube channel, where he reviews kid’s toys.
Last year an American called Jimmy Donaldson – better known as Mr Beast – made $54m from his YouTube channel.
There are also countless people around the world who are earning serious money every year as Twitch streamers – where they’re essentially making a living by playing video games.
That’s making a lot of people sit up and say ‘well, if they can do it, I can too’.
So can they?
Well they can, of course, but it’s never as easy as it seems – and it’s definitely not as easy as a lot of social media posts make it seem.
The barriers to entry when it comes to making and selling digital content are low – in theory. But, in reality, it doesn’t take long to find a reason to start spending real money.
You might be able to get that graphic design app for cheap – but you’re probably not going to get the most out of it unless you have a decent computer or tablet.
You can start a podcast or YouTube channel for free, but if you’re using a crap microphone or camera, or you’re in a poorly-lit room, it’s not going to look or sound very professional.
More importantly – you still need talent. Just because you have the tools to draw something, make music, or upload to YouTube, that doesn’t meant that people are going to want to buy or consume it.
Let’s be positive - what if you are making something good?
That helps – but the big, hidden barrier people are going to come up against is time.
If you create a piece of digital art, or a poster or t-shirt and put it up for sale online – that’s really just the first step in the process.
Because while some will talk about this being passive income – where you put it up online and people just start buying it - that’s very unlikely to happen.
It’s more likely that you’re going to have to put a lot of time and effort in to promoting it and getting people’s attention.
That particularly applies to the likes of YouTube, too, because you really need to be getting tens of thousands, if not hundreds of thousands of views before you’re going to start making money.
But the YouTube algorithm that suggests new videos to users tends to favour creators that are churning out regular videos to a reliable schedule.
In the case of Ryan Kaji, for example, he has put out around 225 videos in the past 12 months. That’s roughly one video every day and a half, each one well produced and edited, clocking up hundreds of thousands, or more often millions of views.
And that’s how he manages to make millions of dollars a year.
Bear in mind, too, that all of these platforms - be it YouTube, or Etsy or whatever else – they’re extremely competitive. You’re not the only one who thinks that this could be the route to making serious money.
When it comes to selling goods, many online creators will be in a position to under-cut you on price.
Meanwhile others have made a good living off simply being quicker than everyone else – putting up reaction videos or turning around a funny t-shirt that references an event - within minutes.
So if you’re not putting full-time job kinds of hours into your side hustle – you’re probably going to struggle. And even if you are, there’s no guarantee it’ll be worth it.
What about the side hustles outside of the digital world?
Some of these might seem a bit more do-able to some – because they’re less about creating content and more about just buying and selling.
But, again, making it into something profitable is easier said than done.
For example, some online suggest that a good side hustle is to buy the likes of clothes from charity shops, or vintage shops, and then re-sell them at a mark-up online.
But doing this requires a big time commitment – firstly in terms of going out and buying the items, then listing them, getting them sold, and also having to package and ship them out.
And the added risk is that you spend money on items you can’t sell – or have to sell at a loss – so profit is not guaranteed.
Another real-world side hustle centres around vending machines – and there’s this idea that they represent passive income, because you can set them up and they make money while you’re off doing something else.
But of course that ignores the fact that you have to stock them, which costs money, and maintain them.
You also have to find a relatively busy place to put them – which might involve you paying a retailer or landlord rent. Then you have to keep going back and taking all of the money out, bagging that up and taking it to the bank. So that’s fairly labour intensive.
And if you want an idea of just how much work vending machines are – have a look on some of the classifieds sites and you’ll see that you can buy some units for very little. In some cases they’re being given away for free.
If they were the licence to print money that some suggest, that wouldn’t be the case.
Are some of these so-called side hustles just scams?
Some are – or at the very least they’re schemes where making money is a lot harder than the people behind them make you believe.
One good example of that is a scheme that’s as old as the hills – the pyramid scheme, or the multi-level marketing scheme, as it has been rebranded in recent years.
This is the model where you become a salesperson for a company, but to make real money you’re told you need to recruit other people to sell the product too. Then they’re encouraged to recruit people, and they’re encouraged to recruit people, and so on.
In short, you should be wary of any thing that’s built around you drawing other people in to the "network". Or any scheme that requires you to pay a fee, or pay for equipment up-front, with the promise that you’ll earn it back once you're up and running.
Another one to watch for are investment scams. Given the buzz around things like Bitcoin, many of these have also been crypto-themed in recent years, but that’s not always the case.
Some times these investments are completely fictional. In other cases they’re ‘Pump and Dump’ schemes, where the promoters get normal people to buy in, inflate the price, and then cash out before it crashes.
The rule of thumb with investments is to try to deal only with regulated entities – as it’s the only way you’ll have any protection if things go bad – and be extremely wary of anyone who is guaranteeing you a big return on whatever investment you make.
Are there any worth-while side hustles?
Well most of these could, in theory, be a way of making money – but you’ll find that those who have the most success tend to have in-demand skills.
People with multiple languages might be able to earn a bit on the side doing online translations, for example, or if you can code you might do some freelance web or app design. Many have made money tutoring others – be it in-person or online.
And there are platforms now that make it easier for people to list small jobs – or for people to list their skills and availability.
There are also lots of casual jobs available in the so-called gig economy – like delivery cyclists or drivers – that some may find useful as a way of bringing in an extra bit of money here and there.
But, again, these things still require time and effort – there are few, if any, ways to make money that don’t involve a big commitment.
The key is not to be duped into wasting your energy on something, and it’s very rare that you’re going to hit upon something that allows you to make money while you do nothing.
What about tax?
This is the thing that’s often easy to forget when you’re calculating all of the money you could make through your side hustle.
No matter where your money is coming from – be it in the real world or online – you have to pay tax on it in Ireland.
While the old-fashioned nixer might have been done cash-in-hand, and so harder for Revenue to detect, the digital equivalent is going to be much harder to get away with.
After all, there’s a ‘paper’ trail and a record of how much you earned in those accounts you work through and, if Revenue were to investigate, it wouldn’t take long to find out how much you were making.
And, of course, if you’re earning more than €37,000 from your main job, then it’s going to be taxed at the higher rate – so that means about half of it is gone in tax.
And if you’re in the privileged position of earning more than €5,000 a year from this side job, you’ll also need to register with Revenue for self-assessment.
Bear in mind, too, that any of these platforms you sell on – be it Amazon, Etsy, Depop or somewhere else – will all take a fee of their own from every sale.
That means you have to be pulling in some fairly solid sales in order for it to be worth your while.
