The gig economy has become a huge part of the labour market in the UK and further afield. Whilst it’s a term that’s become associated with jobs such as delivery driving, there are plenty of ways that the gig economy can supplement your income.
Rather than being paid a salary, gig economy workers are paid per ‘gig’ or work completed. It’s become a term that’s frequently used to describe a range of employment positions, from those with short-term contracts to freelance work. Whilst the gig economy has received negative publicity, with some businesses using it as an alternative to traditional employment leading to claims of exploitation, there are plenty of reasons why workers may 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. 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 salary, the gig economy could provide an opportunity.
4 side hustle options
When you think of side hustles there are probably a handful of options that spring to mind, but there’s a huge demand for a range of skills, services and products that you could deliver. If you’re looking for a way to make some extra cash, these four 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 enjoy making crafts or getting artistic, selling your products can be an excellent way to make some additional money. It 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. Taking on freelance projects: There are numerous online platforms where you can sell your skills and connect with someone looking for a professional like you. From graphic design to data entry, 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. Whilst renting out a room in your home has become more common, other options don’t mean letting strangers into your home too. Depending on where you live there could be a huge demand for parking spaces or storage.
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.
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 plans too.
One of the first things you should consider is how your side hustle could affect your tax liability. If your total 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 could mean moving 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 save for the future, making it part of your plans can help keep you on track. Contact us today to discuss your financial plan.
Please note: The Financial Conduct Authority does not regulate Tax Planning.