by wprapido on 8/4/20, 7:50 AM with 49 comments
A few days ago I was talking with a friend of mine who among other businesses in Ireland and Croatia runs a bar in Zagreb, Croatia. His reasoning behind running a bar is that the bar serves as a daily cash stream. Something definitely we all need and something that helps a great deal.
Anyway, do you have a side hustle like that, and what is it?
by rsynnott on 8/4/20, 7:22 PM
Of course the downside is that if things go wrong it acts as a daily cash sink, instead. Most businesses, especially retail/catering businesses, fail. Don't get into that unless you know what you're doing.
I have a daily cash stream; it's called a job.
by dmje on 8/4/20, 8:14 AM
1) keep two work bank accounts, one for daily use, one savings, and syphon off more than needed from daily > savings when invoices are paid. Example: client pays us £5k. We know we need to put aside corporation tax (we're UK based) of 20% on profit, but instead we put aside 25%. After a while of doing this you end up with a nice chunk of cash in the savings pot for any really famine-y times.
2) Retainers and ongoing "low effort" rolling work. We've got a bunch of clients on board who pay us for hosting, maintenance, the odd fix - they pay annually so it's a good "known" source of income without varience. I mean, obviously sometimes they churn and decide they don't need us any more, but for the most part it's solid. This second source is also good because we offer it whenever we do new work - so typically a project will pay for the project but then also for the ongoing retainer as well.
The second thing is important to note for developer type people I think - namely, people pay for things that you (as developer) wouldn't necessarily pay for. I'm surprised at the high percentage of clients who sign up to maintenance agreements (it's north of 95%), purely because they want someone onboard who will hold their hand / look after stuff that they don't understand.
So I guess I'm saying - do a side hustle, totally - but maybe start by looking closer to home. Existing clients are really, really easy to sell to, easier than a new project and probably easier than working in a bar, too :-)
by emit_time on 8/4/20, 6:53 PM
Also I keep a large emergency fund and save/invest the majority of my earnings.
by voisin on 8/4/20, 7:39 PM
by chillacy on 8/4/20, 6:56 PM
That doesn't seem like much but if I had 10 niche apps which did the same then I'd have a pretty nice income floor.
by Topgamer7 on 8/4/20, 7:12 PM
by graeme on 8/4/20, 7:55 PM
But it reliably generates revenue. That’s the important bit. Needing daily cash is actually likely a sign of poor personal cashflow management. You ought to aim to have a buffer such that you could survive with zero cash for a while.
Now, a recurring revenue stream: it’s great! Highly recommended. But daily is not a good requirement.
And something like a bar has downsides:
* takes personal labour to make money
* High operating costs
* requires presence in a location
* currently, subject to pandemic restrictions
Now bars can be a great business! But for a software developer looking to develop a revenue stream, your best bet is....software. Basically zero cost to start. A bar would be a thing to do if you enjoyed it.
by notJim on 8/4/20, 7:59 PM
Like I think most people, I have a job which pays me every 2 weeks. What this enables me to do is take some small amount of that money each day to cover my expenses. I suppose if you wanted to conceptualize it as a daily cash stream, you could simply divide the lump payment by (roughly) 14, but I'm not sure why you would do that. Some days I spend a lot of money (when making a major purchase, for example), and some days I spend none at all.
by tunesmith on 8/4/20, 6:42 PM
Zooming out, there's a lot of tech theory on buffers and streams that apply. A "JIT" stream is something that doesn't need a buffer if it's perfect and reliable and consistent enough. The YNAB approach is more about using that buffer.
by Havoc on 8/4/20, 7:04 PM
Looking to build a blog, but not optimistic that it'll generate any real money
by madhadron on 8/4/20, 8:02 PM
The answer is to have a buffer. Think of it like a queue. You are pulling things off the queue at some rate with some variation, and stuff is arriving at the far end of the queue with hopefully a slightly higher rate but with much higher variation. In order to always have queue you can pull from, you need a buffer in the queue big enough to handle the input variations.
Which is a way of saying, having however many months of living expenses in the bank (six to twelve months, usually). Spend money you have already earned at or below the rate that you are currently earning it.
Is having another income stream that makes regular money worth it? It depends. We can assume that it makes less money than your irregular income or otherwise deprives you of some benefit or need, otherwise you would ditch your irregular income and do just that. In that case it's purely about how much reducing the volatility of your income stream is worth.
by Kosirich on 8/4/20, 8:11 PM
by boldlybold on 8/4/20, 7:26 PM
Income from options on indices or futures is subject to 60/40 long/short term capital gains tax and really helps keep the tax costs down.
by quickthrower2 on 8/4/20, 7:47 PM
And as others have mentioned: budgeting.
You shouldn’t need a side hustle to buy your milk and pasta. A side hustle is more like a bet or lottery ticket.
Good luck!
by nawgz on 8/4/20, 7:47 PM
To me, it just sounds like a savings account. I have money in the bank because I have good financial management.
Why would I need to augment that with a risky side hustle?
by quangv on 8/4/20, 6:49 PM