How to Make the Leap From Side Hustle to Full-Time Dream Job

Learn real tips from real side hustlers who are now thriving full time.

For Michelle Schroeder-Gardner it all began with a blog. When she started Making Sense of Cents in 2011, a chronicle of her journey paying off $38,000 in student loans, it was a fun way to make money on the side while maintaining her full-time job as a financial analyst. Fast forward two years and she’s left her day job to focus on the blog exclusively. Fast forward another five years and she’s earning more than $1 million annually from her site.

If you too are looking to turn your side hustle into a full-time job, experiences like Schroeder-Gardner’s prove that just about anything is possible. And you’re not alone. Nation1099, an online resource for freelancers, published a 2018 report to summarize data from various career studies and concluded that approximately 11 percent of the working adult population in the U.S. is working primarily as full-time independent contractors in the gig economy. Gig workers, also known as on-demand workers, function with a non-standard work arrangement and without a long-term employment contract.

Some, like Schroeder-Gardner, have ditched a traditional lifestyle and are working while on the go and whenever they’re most productive (she travels around the world in an RV and sailboat and writes when motivation strikes). Others are logging full-time hours at home or in a coworking office space.

With a thriving gig economy, it could be the right time to turn your side hustle into a full-time job.

Although figuring out how to turn your side hustle into your dream job requires hard work, with patience and persistence, you can succeed.

Learn from the experts themselves and consider these steps for turning your side hustle into a successful business:

Educate yourself

The first step for turning your side hustle into a successful business is building the right skill set so you can stand out in your field. Research industry best practices and in-demand skills, speak to successful professionals and read about others who’ve made the leap from side hustle to full-time job.

The first steps for turning your side hustle into a successful business are doing your research and developing skills to make yourself stand out.

When Jill DeConti, founder of the blog The Luxe Travelers, decided to leave her finance job to devote all of her time to her side hustle as a travel blogger, she knew that knowledge would be instrumental to her success.

“I began researching, reading books, soaking in knowledge,” DeConti says, adding that she also focused on learning marketing best practices and how to generate revenue from her blog.

Reading about the steps for turning your side hustle into a successful business proved useful to DeConti not just for the practical tips she gleaned, but for motivation as well.

“This made me realize that my dreams were actually possible,” she says, “and made me feel less alone in pursuing them.”

“Even though I was earning a good income from my side gig before I turned it into my full-time career, I was terrified to leave my day job.”

– Michelle Schroeder-Gardner, founder of the blog Making Sense of Cents

Take baby steps

Schroeder-Gardner says one of the most challenging parts of turning your side hustle into a full-time job is building a business framework and believing in it.

“Even though I was earning a good income from my side gig before I turned it into my full-time career,” she says, “I was terrified to leave my day job.”

Growing her gig on the side to make sure that it actually worked—and would generate income—helped her gain confidence while she still had the security of her day job’s salary. When she was ready to make her side hustle full time, she knew the framework for a blog that could make money from affiliate marketing was already in place.

“I knew it was time when I was earning enough from my blog to live off of,” Schroeder-Gardner says. “I was earning around $5,000 to $10,000 a month from my side hustle at that time.”

Build an emergency fund

If you’re thinking about how to turn your side hustle into your dream job, be prepared for business—and earnings—to not go exactly as planned.

“Build an emergency fund,” Schroeder-Gardner says. “This way, when you turn your side gig into your dream job, you’ll have money set aside in case you have a not-so-good month.”

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You could also dip into your emergency fund to help manage daily expenses and pay your bills while you turn your side hustle into a full-time job. It may also come in handy if you need to finance upfront business costs (new equipment or office supplies, anyone?).

Outside of work, an emergency fund can provide a cushion for other expenses that may not be baked into your budget (think a trip to the doctor’s office or a home repair that came out of nowhere).

As you work on creating an emergency fund as a step for turning your side hustle into a successful business, note that most experts agree that it should include at least six months to a year of expenses.

If you're wondering how to turn your side hustle into your dream job, you'll need an emergency fund to help protect yourself financially.

Invest extra time upfront

You may find that it takes a lot of time to turn your side hustle into a full-time job. There’s networking, promoting your business and accepting new opportunities to build your portfolio—and that’s likely on top of your already packed schedule.

If you’re wondering how to turn your side hustle into your dream job, you may need to carve out time after regular working hours. That was the case for DeConti, whose day job kept her occupied from 9 a.m. to 5 p.m. In order to get her name out there as she built her travel blog, she looked for freelance social media jobs and worked on her own blog “after work and late into the night and on weekends,” she says.

Putting in the time upfront really paid off. These days DeConti can make her own schedule and work remotely, which is key for someone who has made a career out of her passion for travel.

“I’ve been able to travel to Bali for an extended period of time, spend a month traveling around the Greek islands, swim in the cenotes in Mexico, chase waterfalls around Iceland, eat the best pizza I’ve ever had in Italy, take a camper van around beautiful New Zealand,” she says. “As long as I have my laptop with me, I’m good to go.”

Join the side hustlers who have gone full time

If you’re contemplating how to turn your side hustle into your dream job, take comfort in knowing that you’re in good company. Others are now living their dreams, and you can too with some careful planning and confidence.

So, what are you waiting for?

Source: discover.com

Is Now a Good Time to Buy a House?

When you’re thinking about taking the plunge into homeownership, timing the market may not be as important as taking stock of your personal finances and lifestyle.

So you’re at the point in your life where buying a home is not a question of if, but when. You’re scrimping. You’re saving. You’re dreaming of walking through the front door of your very own home.

But as the decision draws near, you start questioning everything. Is now a good time to buy a house? Or is this the worst time? Is it more financially responsible to buy a house right now or wait? And what if you mistime the market, buying too soon or too late, and miss out on lower home prices?

Ultimately, the experts say the answer is less about economies, markets and pandemics and more about you.

So, how do you think through this decision? You’ll want to take time to thoroughly review your personal financial situation and life goals. At the same time, you’ll need to gain some understanding of the market dynamics that impact home costs.

External factors can make buying a house right now intimidating, but your personal finances are an important factor.

This process will take some time, but it’s well worth the effort. With a firm grasp on your personal situation and some context on the housing market, you’ll be able to confidently go forth knowing you’re making a fiscally informed decision about whether to buy a house right now.

Honestly assess these aspects of your finances

Financial security is always important if you’re trying to determine when you’re ready to buy a home. To decide if now is a good time to buy a house, ask yourself the following questions about your finances:

How secure is your income?

Job or income stability is an important factor if you are buying a home in a rocky economy, such as the one triggered by the coronavirus pandemic, says real estate economist Gay Cororaton. Even in a robust economy, your income security should be top of mind when you’re thinking of buying a house right now.

If you have any inkling that your position may be eliminated or that you’ll be making a career change, you may want to delay buying a home. Even a recent break in employment that caused you to draw down some of your savings may raise a red flag with lenders, says Kate Ziegler, a real estate agent with Arborview Realty in the Boston area.

Do you have enough money saved?

After income stability, savings is the next-most-important financial factor you’ll want to consider to determine if now is a good time to buy a house, Ziegler says. The old rule of thumb was to save 20% of the price of the home for your down payment. While that is ideal, it’s not necessary—far from it, Ziegler says. In fact, it has become more common for first-time buyers to put down much less than 20%.

How much house can you afford?

The down payment is one side of the affordability coin. Your monthly mortgage payment is the other side. You need to know how much you can spend on both to determine if you can afford to buy a house right now, says Jeff Tucker, a senior economist at Zillow. Aim for a monthly mortgage payment that doesn’t stretch you too thin—experts typically put this at around 28% of your monthly gross income, according to Bankrate.

With those guidelines, you can determine what you can afford. For example, if you make $4,000 a month, you should typically spend no more than $1,120 on your monthly mortgage payment in total.

How much house that buys you depends on multiple factors: mortgage rates, property tax rates, homeowners insurance and—if you don’t have the savings to put down 20%—primary mortgage insurance, or PMI. To get a rough estimate, plug your income details into an online calculator. For a more specific figure, talk to a local lender and get pre-approved for a mortgage, Ziegler says.

If you're buying a house right now, aim for mortgage payments around 28% of your monthly gross income.

Once you know your price range, you can determine how much savings you need in the bank to buy a house right now. You’ll also need to have money saved for closing costs, which vary but typically run 2% to 5% of the loan amount, according to Bankrate.

Again, Ziegler recommends talking to a lender to really understand what your individual down payment and closing costs would be. Finally, be sure to add a line item in your budget for home maintenance that will inevitably pop up after you move in. Whether it’s a dishwasher on the fritz or a leaky roof, you don’t want to be caught off guard, so be sure to save money for emergency home repairs.

How is your credit?

Your credit profile is also important to lenders, and it will likely be a factor in what interest rate you’re offered. Given that, you should be checking your credit report and know your credit score before investing in a home. If you’re considering buying a house right now, you should avoid opening any new lines of credit right before purchasing a home, Tucker says.

What is your debt-to-income ratio?

Another factor lenders check is your debt-to-income ratio, or DTI, Tucker says. This is the percentage of your gross monthly income that goes to paying monthly debt payments, plus your new mortgage. Lenders typically require this ratio to be 45% or less but prefer it even lower—in the 33% to 36% range.

Have you considered the opportunity cost?

Another financial consideration when deciding if now is a good time to buy a house is the opportunity cost of delaying a home purchase, Ziegler says. If you’re renting in a market where the rent is higher than your would-be monthly mortgage payment, you may be spending a lot more money each month than if you were to purchase a home. And of course, with a mortgage, your monthly payment increases your equity.

After taking a clear-eyed look at your income, savings and these other financial factors, you will have a better sense of when you’re ready to buy a home and whether now’s the time for you to dip into the market.

Consider key market factors

Next, take a look at factors that are outside of your control, but still influence your purchase: prices, interest rates and national employment trends.

Where are housing prices?

As you’re looking at the market, one of the biggest considerations when you are ready to buy a home will be housing prices and availability. Research your local market by talking to real estate agents who work specifically in the area where you want to buy and asking them about market trends, Ziegler says.

Track current listings and recently sold prices to get a sense of how prices look today. Generally, the tighter the inventory—meaning the fewer houses available—the higher prices will be, Tucker says.

If you're trying to determine when you are ready to buy a home, track current listings to get a sense of how prices look today.

What’s going on with interest rates?

When you’re ready to buy a home could also depend on another major economic factor: interest rates. When interest rates are low, your housing budget is effectively supercharged, Tucker says, and you can afford a more expensive house because you’re spending less on interest. When they are high, the opposite is true.

This is what compels people to buy when interest rates are low—you get more for your money. If you get a 30- or 15-year fixed-rate mortgage, you lock in that rate for the entire life of the loan, which could save you money now and into the future, Tucker says.

How does employment look nationally?

Finally, if you want to get a general idea of where the housing market may be headed—if prices will drop or rise soon—check out the national employment trends, Cororaton says. Low unemployment means prices will generally trend upward because more people can afford houses, boosting competition and prices, she says.

But if unemployment is inching up, then people are losing jobs and will be more likely to remain in their current homes. As a result, there tends to be less competition for them, lowering prices.

You don’t need to be an expert in the market to determine if now is a good time to buy a house, but a baseline understanding of these big-picture forces can give you the confidence you need to embark on your home-buying journey.

So when are you ready to buy a home? Paying attention to big-picture economic forces can help you decide.

Think about your future plans

After reviewing your savings and income and assessing the market conditions, take a step back and think about your life plans over the next few years. Your lifestyle and goals will help determine whether now is a good time to buy a house.

“For buyers who are not certain whether they will still be living in the same place in three or five years, I would caution against locking themselves into a certain location,” Ziegler says. “If they’re just not sure what the future holds, it may be better to have that flexibility.”

It’s unlikely in many markets that you will see substantial financial gain from homeownership if you move within five years, Ziegler says. Your equity gains will likely be offset by the transaction costs of buying and selling your home.

That goes for remote workers, too. Are you working from a home office these days? While widespread remote work may allow buyers to consider homes farther from their offices, ask yourself: Is my company going to permanently allow employees to work from home? Do I think there will be other remote opportunities in the future?

Is now a good time to buy a house? That depends on your lifestyle and long-term goals.

While you’re thinking about the next three to five years of your career, also consider the next three to five years of your personal life. Will you have a family? Will that family grow?

These can be weighty topics, so be sure to think them through on your own schedule. Buying a house is a big decision, and it’s not one to be rushed. By taking the time to assess your life, from your job security to your financial health to your lifestyle, and considering the impact of market factors, you’ll have a clearer sense of when you are ready to buy a home.

If you’ve decided that buying a house right now is the best decision for you, it’s time to learn more about how it will impact your budget. Get started by reading up on these eight unexpected expenses when buying a home.

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Source: discover.com