Side Hustles Are Overrated (Do This Instead)

Side hustles, while capable of boosting income, are often overrated and not the most effective path to wealth. Many personal finance experts overlook that for a lot of people, a side hustle can actually slow down financial progress. Instead of immediately pursuing a side gig, it's crucial to assess if it's the best use of time and energy. One major reason side hustles are often ineffective is low pay. The median side hustle income is only $200 per month, with 28% making $1 to $50. When factoring in hours and wear and tear, the effective hourly rate is often below a main job's pay. Secondly, side hustles contribute to burnout. Adding extra hours to a full-time schedule reduces sleep, family time, and mental recovery, potentially impacting performance at the main job, which provides benefits and career growth. With 66% of American employees experiencing burnout, adding a second job can lead to stress and exhaustion, derailing primary income and health. The third, often overlooked, reason is opportunity cost. Investing the same time and energy into one's primary career can yield significantly greater returns. For example, pursuing professional certifications, building skills, networking, or excelling in one's current role can lead to substantial raises, unlike the temporary gains of a side hustle. A raise creates a new, higher baseline for future earnings and retirement contributions, while side hustle income must be re-earned annually. A more effective two-step path involves maximizing primary income through skill development, continuing education, and strategic networking, followed by increasing one's savings rate. A higher salary alone doesn't build wealth without consistent saving and investing, ideally 25% of gross income, made automatic to prevent lifestyle creep. Side hustles aren't inherently bad; they can be valuable as a stepping stone to entrepreneurship or for consulting in one's primary field, building skills and networks. If a side hustle brings genuine satisfaction without compromising health or primary career, its financial metrics don't need to be perfect. However, successful side hustles are the exception. Most people don't sustain them long enough for meaningful financial change. Ultimately, focusing on growing primary income and consistently investing the difference is often the more powerful path to building real wealth.