Gig work seems to be the new wave.
More than ever before, we have seen people start working part-time, transition to full-time, and people who just out right understand and have gained much more respect for “gig workers”.
Many times, people want to make some extra cash. They love the instant pay (gratification) that gig work provides. However, there are some things to examine before getting started.
Such as everything else in this life, gig work has a set of pros and cons that you may need to consider. Some people see money today but forget that tomorrow they will need to pay for expenses just to be able to work. Some focus on trading time for money not understanding that there is a bigger picture. Many don’t consider the mental and emotional capacity that is needed just to be able to complete a task.
Below are some things that you should consider before starting any type of gig work, as it is not for the faint of heart.
Gig work is a business
My favorite saying is “If you treat it as a business, it shall be”.
Being a gig worker takes critical thinking, organizational skills, time management, and financial literacy.
You are completely in control of the work that you do. You will need to know which apps make you the most money and most importantly, the time frames in which it makes sense to do them. You will also need to keep track of your income and expenses.
I always suggest that people adopt a mileage tracker as well some sort of seamless accounting software that can connect directly to their bank account. This will allow you to see your profits or losses to confirm (or deny) that you are reaping the benefits from “gigging”, as each market or circumstance differs.
Know your why
Since the first day I started driving Uber (My first time doing any sort of gig work), I have been asked “What made you start driving for Uber”?
As cliché as this question is, I personally feel like this is the number one thing you should ponder before starting gig work. People love the money they earn. However, what is your goal? Why are you working? What do you plan to do with the money you are making? Many people just see money but have no plan for it.
Six months can go by and all of their money can be spent on gas and sometimes people are left in a worse position than they were before they started. This tends to occur with contractors who use their own vehicle for gig work.
For example: People who drive rideshare have a higher chance of placing more miles on their vehicle. Not only is the value of their vehicle heavily depreciating but they also have to pay for gas which can be at least $25 a day (working 8+ hours a day) depending on their market and vehicle. They have to pay for new tires, oil changes, and anything else that can and WILL go wrong with their vehicle.
Long term, rideshare may also not make sense for someone who is paying a car note. This means that they are just breaking even, or can end up paying more money over time.
In contrast, you may be someone who needs free time to invest into your independent startup or who needs the flexibility of being an independent contractor.
Either way, you must weigh your options and balance out if being a gig worker is actually helping you.
You must pay taxes on the money earned
More often than not, you will find that some people are totally oblivious to that fact that they will need to pay income taxes on the money they earn as a gig worker.
It does not matter if the work was a “side hustle” or not. It must be reported to the IRS. If not, even five years later, the IRS can run an audit and you will owe them money.
Your information is shown in the contractee’s database and they actually hold documentation on your earnings. This information is still being reported. This heavily correlates with running a “business” as well as knowing why you began to freelance to begin with. Are you actually making a return on your investment, or are you just breaking even?
Work-life balance is important
When you first begin to really see the fruits of your labor, you may become inspired to work more.
However, there is such a thing called “burnout”. It’s amazing to know that you can make money whenever you want, or you can relax whenever you want. However, you must know that the ball is always in your court. This means that you will need to have enough self-discipline to get up and work, even when you do not want to.
In contrast, when money is calling your name, though you may need to rest, you must make the best decision for your circumstances. One thing to remember is that “if you are not good, you will not be good for anyone else”. You will not be able to work or exist at your highest potential.
As they say “HEALTH is WEALTH”. Being able to balance your physical, mental, emotional, and financial health is key.
Gig Work has personally served me well. This is a list of things that I heavily considered and skills that I have built over time to come to this conclusion. I hope this short read has found you well and has given you some food for thought.
Best wishes to you and remember to always see the glass half full!