You’ve done the budget a hundred times and it still won’t balance. You’re worried you’ll never get out of debt because you don’t have enough money to pay your current bills. What do you do? Let’s talk about how to payoff debt with side hustles!
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Whether you complete a monthly budget or you budget by paycheck, you may be in a position where the numbers don’t balance, and your budget is negative. That means you don’t have enough money to pay for everything you want and need to pay for.
Around here, we use a zero-based budget. That simply means that every dollar that comes in has been assigned a job and category on its way out so that income minus expenses equals zero. But maybe you’ve blown past zero into the negative. Before we talk about making more money, let’s review a couple of ways you can cut expenses:
- Make more meals at home. Unless you’re single, it’s likely that you’ll save more money by cooking at home than by eating out. Run the numbers and see. Is your daily work lunch costing you too much money? Spending too much each week on ladies’ night? Maybe it’s time to reign in the spending. And when you cook from home, make a meal plan for the week with a list of items you’ll need to support that plan and only shop from that list. No cheating!
- Look at temporarily trimming entertainment expenses. This isn’t to say you’ll never watch Hulu or Netflix again, but maybe take your 7 streaming services down to one or two – especially if you aren’t watching much television anyway. You can always restart your service when your budget is more stable.
Sometimes, you’ve cut so much from your budget that there isn’t anything left. The best option, my favorite option, is to increase your income. You can start to do that in the usual ways by asking for a raise, getting a part-time job, or even getting a new job that pays more.
Let’s say you’ve done all of that, or maybe, you don’t have a traditional job or can’t work a traditional job. Enter side hustles.
Side hustles are great because they tend to be super flexible and allow you to work around your other family and work obligations. I also like side hustles because there is truly no limit to how much you can earn – it all depends on how you structure your side hustle.
I’ll create a future post on my favorite types of side hustles to boost your budget, but whether you choose freelance writing, Facebook ads, or content creation, the additional money in your budget can not only get you moving in a positive direction but also provide you with extra income to start paying off your debt faster.
As you heard in the introduction, I have a web design business. I’m using that business to help other businesses and content creators while boosting my income to pay off debt faster. It’s a win all around.
In order for this to work, you have to know how much you need to cover the shortfall in your budget. Let’s say you need an extra $1000 each month, and you decide to become a freelance writer. In order to account for taxes (because you are self-employed and running a business) and any overhead, you’ll want to bill twice what you need to bring home. So in our freelance writing example, in order to clear $1000, I recommend you bill $2000 worth of work.
This is all dependent on you knowing your numbers. If you haven’t started budgeting, then you don’t know where your money is really going and where you might need to cut back. We don’t want to pull numbers out of the air. Rather, we want to make informed decisions based on the money we actually spend and need to balance the budget.
One of the big mistakes I see new side hustlers make is not charging enough for their services. Part of this is because they don’t know how much to charge. Another reason is they aren’t confident in their services and think they have to compete on price. You don’t. That turns your service into a commodity and ignores the value you bring to the table. Don’t shortchange yourself by charging less than your services and expertise are worth.
And if you think no one wants to pay for what you know, you’re wrong. People pay for courses and coaching on everything from taking care of plants in Florida to learning how to crochet and quilt. You know something of value. All you have to do is decide what that is and sell it.
We’ll talk more about how exactly to do that in a future episode. But know that side hustles are a great way, and my favorite way, to boost your budget to pay off debt faster and balance your budget.
That’s all I have for you today!
Let me know: how are you going to boost your budget in 2023? Are you going to start or go all-in on any side hustles? Tag me on IG @ mrswendycoop or leave a comment below.