For most workers, the cosiness of returning to ‘normal’ will be enough. For others, it won’t be. They will want more, especially as the increased cost-of-living bites down hard on personal finances. Anyone with a reasonable level of intelligence can move to another job having negotiated a 10% pay rise.
It’s a great way to inflation-proof your income. Take a look at LinkedIn this week and see just how many people have done exactly that. Hurrah for them! I love it when someone plays the card early and takes the prize (apart from when I’m the boss that’s losing out of course).
Conversely, I’m seeing lots of redundancy messages and it’s for these people I feel the most. One post I read before Christmas consisted of a couple who had both been fired in December, and they were pictured holding a toddler in front of a Christmas tree. You can’t help but feel sad for them, but at the same time, they’ve fallen into their own unfortunate trap.
“You’re either a worker or a hustler, and you my friend are a worker” – Brian Brown to Tom Cruise in Cocktail (1988).
To avoid such inconvenience, I believe everyone should try to create at least three income streams, regardless of how much or little they generate. For me, if I have less than five income streams I become edgy. It doesn’t mean I have five jobs, and it’s not being greedy. I simply refuse to have all my eggs in one basket because it makes no financial sense. If you’re down with the kids all this is known as a side hustle, and it’s become a social media cliché, more I suspect among those who don’t have one and mock those that do.
Being a loyal employee is a fine trait so long as you are happy to remain poor while watching your boss trouser the spoils. And why shouldn’t they?
They continuously risk their capital while you benefit from your pay crediting your account on the same day every month and sleep with both eyes closed. In the hardest of times, my old business partner and I racked up hundreds of thousands of pounds of unsecured loans and credit cards to ensure our staff were paid religiously on the 19th of the month. We barely slept for 9 months with anxiety, but the staff never knew a thing nor felt a single pang of our pain.
But be clear, your boss would prefer you not to have a side hustle. They want you to be loyal and will spend good money ensuring your loyalty through team spirit.
In the inimitable words of Felix Dennis in his book ‘How to Get Rich’, he explains: “[For bosses], team spirit is the glue that binds the losers together. It’s the method used to shackle employees to their desks while not having to pay them too much”. A bit harsh but he is right. Free drinks, parties, bacon sandwiches, Krispy Kremes, little gifts and other useless paraphernalia cost a whole lot less than a 10% pay rise across the payroll.
When times get tight having one income stream means you are but one step away from staring into the abyss of bankruptcy or experiencing temporary severe hardship at least. Everyone dreads the boss saying to them ‘Can I have a word?’. Off you trot to a room upstairs, your colleagues avoiding any eye contact with the condemned. Into the guillotine you go, while the CFO slides a basket under your head with their foot. It’ll happen a lot this year. So cliché or not, why wouldn’t you have a side hustle that will ensure your financial continuity?
Forget about your daily grind for a second, it's trivial. Close your eyes and open your mind and think about what you know that others will pay for, or what you already own that others might rent from you. If you think deeply and allow your mind to go places it’s never been, you will find a world of revenue opportunities. And God bless the internet, you can apply all of it using a magical device that’s right in your pocket. Most people will use it for scrolling Instagram and TikTok, but some understand that it’s a weapon of mass income generation. There are myriad ways to harness exactly what you already have and turn it into hard cash.
Think about what you are good at, and how you can turn that knowledge into simple digestible concepts and descriptions that people understand. It doesn’t matter whether it's origami, skateboard tricks or property investment. If you write about it consistently on platforms like Linked In, TikTok and Instagram then over time you will garner interest from others who feel the same way and see you as an expert.
People will approach you directly and pay you handsomely for your in-depth knowledge on your expert subject. Go one step further and set up a Mailchimp account to collect the email addresses of your loyal fans and send them valuable insights every week or two. But like a farmer, you must tend to your crops. They need feeding and watering regularly to create a harvest.
What about the assets you already have? If your car sits on the drive for most of its life, you can rent it out on Turo. Sell the stuff you don’t need on eBay and your unused clothes on Vinted. If you have a spare room in your home, get it onto Airbnb or Vrbo and start welcoming paying guests to your home.
Go a step further and turn your garage into an amazing holiday let. Campervans and motorhomes spend 99.9% of their life doing absolutely nothing. Get yours onto Goboony or Yescapa and start earning from it. Don’t have one? Go and buy one on Autotrader. You may be surprised that a £25,000 motorhome will generate £1,000 a week in the summer months. £12,000 a year isn’t hard. That’s a 50% ROI.
If you can generate £20,000 after tax a year in side hustles, don’t spend it. Open a stocks and shares ISA with A J Bell on your smartphone and tuck all the cash away tax-free. If you did that every year for 20 years and it grew by 6%, you’d have £800,000 of tax-free cash waiting for you - nearly half of that earned in compounding interest.
Rachel, my housekeeper (sounds posh but I’m not allowed to call her a cleaner) was made redundant following the pandemic. She had a cleaning sideline and decided to break out and make it her full-time business. She started to market her services on Instagram and collects her payments using Stripe, which I settle instantly using Apple Pay. She is so efficient and trustworthy, that she now has a waiting list of clients who cannot access her services due to time constraints. Recently she increased her hourly rate by 15% and not one of her clients, including myself, batted an eyelid. Life without her is clearly inconceivable.
Property investment
A motivated person can do one, two or three of the above and double their annual income without busting an artery. But the holy grail of course is creating monthly residual income. Who doesn’t want to see cleared funds arrive in their account each and every month with minimal effort if any?
For me, that means investing in rental property. Creating a side hustle will draw you into the frame of mind for investing your hard-earned funds. Regardless of what you see and hear about the property market, I can tell you that building a portfolio of investment properties is a long series of the most important financial decisions you will ever make. Do it while you’re still young and have the stamina to do so. Leave it too late and you may not have the energy or capital to make it happen. Property works hard so you don’t have to. It works 7 days a week, doesn’t take holidays and doesn’t ask for a pay rise.
In case you didn’t know, houses normally increase in value over time, and the rent you charge should be increased once a year. If you finance your properties correctly and choose your tenants wisely, your asset base will grow and your income will only ever go up. Multiply it by 10, 25 or 50 properties then fast-forward 20 or 30 years and you will have created an empire. Treat and maintain your portfolio with the respect it deserves and not only will it create enough capital to self-fund all the property you can buy, but you will also reap the financial rewards until the day you take your last breath.
Who wants to sit in an office slaving into their 60’s and 70’s? You can either be a worker or a hustler. Get yourself a side hustle today and make 2023 the first year of the rest of your life.
