In this economy, many people have turned to side hustles to help supplement their income. Are you one of these entrepreneurs? 

 

Maybe you've even been making a little money on the side selling handmade items, offering freelance services, or tutoring after work. Maybe you are starting to do very well, but want to do more.

 

Many successful entrepreneurs start right where you are: with a passion project or side hustle that grows slowly. Turning your side gig into a legitimate business takes more than just time and talent. It takes planning, intention, and a few key financial moves.

 

Where to start

1. Know your why

• Before you dive into the logistics, take a moment to reflect. Why do you want to turn your hustle into a business? Do you want more freedom? More income? To create a legacy? Having a clear "why" helps you stay grounded when the work gets tough, plus it can guide your business decisions and priorities moving forward.

2. Separate you finances

• Open a separate bank account for you business income and expenses. It makes tax time easier, helps you see what you are really earning, and creates a clear line between "hobby" and "business" in the eyes of the IRS.

3. Get legal

• Create a structure like a sole proprietorship or LLC (Limited Liability Company). Also, apply for an EIN (Employer Identification Number) through the IRS and check if you need a business license through your city or state.

4. Track your income and expenses

• Use a spreadsheet to track what you make and spend. This helps you stay organized and understand if your side gig is profitable.

Tip: Don't forget to track your mileage, if you drive for work

5. Make a simple business plan

• A business plan helps you stay focused. It should include: what you offer, who you help, what makes you different, how you'll earn money, and what your short-term goals are.

6. Start small, but think long-term

• You don't need to have everything figured out today. Start with small steps like booking a client or creating a website. Also, keep an eye on the future. Ask yourself questions like, "could this replace my job one day" and "what kind of life do I want this business to support?"

7. Build a support team

• Even entrepreneurs need support. You don't have to do this alone. Consider reaching out to a financial consultant (like Walters Financial Wellness) to help with budgeting, taxes, and planning. Or, find a mentor in your community or in an online community for small business owners.

 

Need help building the financial side of your business?

I offer one-on-one financial wellness counseling to help new entrepreneurs get organized, plan with confidence, and feel in control of their money. Let's build something strong, together!