Category: Money Matters
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24 November 2020

Bossing it: working the gig economy

The live music scene might be a bit quieter than usual this year, but one type of gig is rocking out louder than ever: the gig economy. For a start, you can work on your own terms, to your own schedule, and be your own boss – sounds so good, right? In fact, it’s pretty much like running your own business, so it can (literally) pay to think like a business owner.

So, if you’re getting ready to go solo full-time or looking to make extra cash on the side of your 9-to-5 – or even if you’re just gig-economy-curious – read on for our tips on the nuts and bolts of working your own way.

The gig economy: more varied than you think

There are all kinds of jobs in the gig economy – from delivery drivers to graphic designers, tradies to marketing executives, and so much more. So forget any preconceptions. And there are so many ways you can get into it – from Ubering and Airtasking to freelancing and then some. You can find gigs in many fields that match your specific skills, including an array of technical, specialist and senior roles.

Working it: what do I need to know?

The gig economy is great because it can help you make money from your passion or your unique skills without being tied down to a traditional full-time job. It also lets you try new things and even change careers much more easily – you might find a dream client in a whole new field. You’re free to work when you want and where you want, meaning you can run off and play or relax on your schedule, but this does mean a little extra planning, and it needs to work within your budget.

So it’s good to know about the nitty-gritty. When you’re employed full-time, you’re usually insured by the business you work for. In the gig economy, you’ll need to arrange your own insurance if you need it. There’s no workers compensation, either. Then there’s sick leave. Holiday pay. Registering your business or ABN. Paying tax. Putting away super for your retirement. Those, and more, are all up to you.

There’s a lot to self-manage. And since bills are a fact of life, savvy savings and smart budgeting are super important.

Our gig economy budget essentials

  1. Tote up your living expenses

How much does your lifestyle cost each month? Add it up! Start with the essentials like housing, utilities, food and transport. And don’t forget to include those nice-to-haves, like new threads or a weekend getaway. Finally, factor in any regular debt repayments you have, too.

  1. Average your monthly income

So now you know how much it costs to live, ask yourself, “Am I earning enough to cover it all, and then some?” Your month-to-month income will probably vary – in one month you could score a big lucrative project, and in another you might find yourself getting by task-to-task. So, after some time working for yourself, add up all your income and average it out across the months – that way, you’ll know the monthly average you’ll need to hit.

  1. Total your business expenses

Like we said earlier, you need to run your gigging like you would a business. That means revelling in the revenue but keeping a keen eye on costs. After all, if you’re making great money but your costs are just-as-great, then you’re probably not getting ahead. Don’t forget to account for income tax, too. As a contractor, that’s up to you to stow away.

  1. Get on top of your savings

Make saving a habit, not a drag. Since the money coming in might change month-to-month, think about saving a percentage rather than a dollar value. This can take some of the stress out of it, and keeps it realistic. If you make more money than average one month, consider upping your saving percentage that month to take advantage of the money rush.

  1. Plan for a rainy day

It doesn’t matter if you’re permanently employed or working from project to project – rainy days happen. So think about how you can plan for these. You could get ahead on your bills by allocating last month’s income to them, or commit to squirrelling away the extra funds from a good month. Planning might not keep the surprises at bay, but it will prepare you for them.

So now you know the gig economy. No matter whether you’re looking to stow a little extra in your wallet each week or dreaming of turning your side hustle into your main business, if you’re ready to work on your own terms, we’re here to help. Check out our budget planner and savings calculator.

ING does not endorse and is not affiliated with Uber or Airtasker. ING is not responsible for any services provided by or buisness systems operated by third parties. ING does not accept any liability or responsibility arising in any way from any third party products, services or business systems.

The information contained in this article does not constitute financial product advice or tax advice. ING recommends you seek independent financial or taxation advice where appropriate.

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