I want to introduce a concept I call The Side Hustle Snowball.
If you’ve heard about Dave Ramsey’s “Debt Snowball” framework, this may sound familiar.
Here’s how The Side Hustle Snowball works:
You itemize out your expenses and then aim to come up with side hustle income to cover them, starting with the smallest and working your way up.
Once you reach the bottom of your list, you don’t need your job anymore!
The reason I like this framework is setting out to replace your income with a side business can be a daunting task. The Snowball approach breaks it down into mini-victories and lets you celebrate your progress along the way.
And just like a real snowball, it picks up steam, size, and momentum as it gets rolling.
The Side Hustle Snowball in Action
Let’s look at some real-life examples. These are some of my actual monthly expenses*.
Dollar Shave Club – $3.29.
Gotta keep this dome smooth and shiny.
Like father, like son.
I can sell just one gig on Fiverr and cover this one. In June, my Fiverr efforts brought in $136.
Netflix – $9.99.
Hardly an essential expenditure, but something we enjoy in those rare moments of downtime.
One easy way to mentally cover small expenses like this is to buy shares of dividend paying stocks, like AT&T. With a current dividend yield of 4.6% and a share price of $42, it would only take 62 shares to cover your annual Netflix and Chill habit.
Life Insurance – $13.86.
Even though I fully trust Bryn will be just fine financially without me, I did set up this policy before our little guy was born.
I just listed a little Weber BBQ for sale. Hasn’t been used in years but still in perfectly good shape!
Gym Membership – $17.
I don’t get the gym as often as I used to, instead opting for more efficient home-based workouts (or — if I’m being honest — none at all). But I like to go to yoga class there when I can, so I keep the membership.
Cell Phone Bill – $50.00.
To cover this, you would need to sell about 25 Kindle books at $2.99. That’s less than 1 a day.
These sales numbers are a little low, but it’s been a couple years since I’ve had a “hit” book. (I’m working on a new title this summer!)
Gas – $50.00.
Thankfully working from home limits my expense here. Still I’ve somehow managed to rack up 80,000 miles in 8 years!
Side note: Just realized I’ve been a full-time side hustler for 8 years!
But if you rely on your car to commute for work, why not put it to work for you — at least enough to pay for itself. I bet you could drive for Uber or Lyft one or two nights a month and cover your monthly vehicle expenses.
If you don’t want other people in your car, there are a dozen different delivery services that have popped up as part of the “sharing economy.”
Internet and TV – $80.91.
People like to hate on Comcast, but they’ve generally been pretty reliable as an ISP and I depend on them to be able to run my business online. We’ve got the basic cable package and Internet service.
One way to cover this would be to write a freelance article or two. I don’t do a lot of this, but have been paid $75 + traffic-based performance incentives for articles I have written the last couple years.
My guest Gina Horkey even turned her freelance writing side hustle into a full-time business and now charges up to $250 per article!
Car Insurance – $82.71.
Because we drive old, inexpensive cars, and have safe driving records (knock on wood!) our insurance is pretty cheap. And yes, 15 minutes actually did save us 15% by switching to GEICO :)
I covered this last month with book sales through CreateSpace:
Surprisingly, my bestselling paperback title is actually Volume 1 of The Side Hustle Path series, which is free to download on Kindle.
Here’s some more info on why you might consider giving a book away on Amazon and how to get it done.
Utilities – $120.00.
For us, this includes gas and electricity, water, and garbage service. During the summer it’s a little higher due to running the air conditioning.
In May, I was able to cover this through consulting calls on Clarity.fm:
If you’re not familiar with this cool by-the-minute consulting platform, here’s my guide on getting started.
Groceries – $400.
We spend about $100 a week to feed our faces, mostly from Costco and Trader Joe’s.
For most of the last year and a half, I was buying groceries with proceeds from online course sales on Udemy and Skillshare. But for the last couple months my Udemy earnings have taken a hit, so I’m looking for some new “grocery money”:
Child Care – $800.
This is the biggest new additional expense our bundle of joy has brought us. Since I work from home, I have to ask the sometimes-challenging question: “Did I at least make enough to pay for daycare today?”
Some days the answer is no. In fact, a lot of days the answer is no — because these days I tend to spend most of my hours on stuff that’s indirectly monetized, chasing that elusive passive income :)
But now we’re getting into the big ticket items. How to pay for this one?
On the podcast last year, Travis Scott shared how his Amazon FBA side hustle went from $500 a month to over $4000 a month, so the “buy low, sell high” business model is definitely one option.
A new income stream for me this year is podcast sponsorship. Lately the show has been directly earning about $300 a week (after production costs), which is a nice way to cover our little hustler’s daycare.
Rent – $2200.
Ahh the big one. If only we could make this disappear, right?
One creative guest of mine actually did just that by renting out some spare space on Airbnb, but if that’s not a viable option for you, I think this one is going to take some time to tackle.
On The Side Hustle Show, you’ve heard dozens of ways to earn $2200 a month or more, but in my case the process usually looks like this:
- Build some unique and helpful asset.
- Market the crap out of it.
- Figure out a way to monetize it.
The assets and marketing methods have varied (and will continue to), but one consistent monetization method — at least for me — has been affiliate marketing.
Affiliate marketing is a fancy way of saying “helping other companies sell their products or services online.”
As an example, I wrote a post early this year promoting Udemy’s New Year’s Sale. It was a pretty blatant affiliate play, which I openly admitted, yet I had people thanking me in the comments.
Why? Because it was helpful to them!
But I didn’t call it “Udemy’s New Year’s Sale”; I called it the much more clickable and content-heavy “The 134 Best Udemy Courses for Entrepreneurs, Freelancers, and Side Hustlers”.
When the dust settled, the post netted almost $7000 in affiliate earnings.
But here’s the thing. I don’t know if I could have pulled that off on a brand new site without two and a half years of Side Hustle Nation under my belt.
The projects that cover my rent took months and sometimes years to build. The good news is they’ve been really fun, inspiring, and educational to work on.
Again, that’s just what my Snowball looks like. Yours might be bigger or smaller or feature entirely different income streams.
In fact, for the sake of simplicity, you might be able to cover ALL your expenses with ONE business. But don’t aim to bite off the entire expense list all at once. Celebrate covering the little costs and work your way up to the big ones.
I hope you can make use of The Side Hustle Snowball framework along your own journey to financial freedom.
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*Sticklers will note that I’m paying for these expenses with after-tax dollars, so really would need to earn a bit more to pay for them. But you get the idea.