3 Steps to Building a Financial Safety Net From “The Economy of You”
Nobody should have only one source of income.
That’s what financial writer Kimberly Palmer claims in her new book, “The Economy of You: Discover Your Inner Entrepreneur and Recession-Proof Your Life.” And she makes a compelling argument — in a time when the word “recession” is still wafting through the air and it seems like full-time jobs are constantly cutting benefits and hours, one of the most powerful things you can do to gain financial independence is create more than one source of income for yourself. Not only does it allow you to save more now, but if you do lose your full-time job, you have something you can fall back on.
Thus, Palmer’s book is a guide to starting your own side business, and she is both inspiring and realistic about the rewards and challenges. One of the most interesting things about Palmer’s book is that it fills a very particular niche. In a world where people celebrate the entrepreneurs who go out and become their own bosses full-time, Palmer’s book targets people who want to start side gigs but not necessarily to replace their full-time jobs. And Palmer doesn’t just interview others about their experience doing this, but she also did it herself — she launched a successful financial planner business in addition to her full-time job with US News and World Report.
Steps to Building Your Financial Safety Net
I strongly recommend reading the entire book — not only does Palmer outline stories from people who have made the leap to successful side gigs already, but the back section is a workbook that helps you figure out what kind of side gig would fit your personality and how to get started. Here are a few of the most important takeaways from the book.
This is a key idea that Palmer hits on again and again — if you’re going to take on a side gig in addition to your full-time job, it needs to be something you’re passionate about, whether that’s helping others, creative work, or something else.
It also helps if you’re passionate about the reason why you want extra money as well. Palmer notes that many people start to earn more side income after they have children, so they can provide more stability for their families. She says that focusing “on the big-picture reason for those goals -- the specifics behind financial security or a better family life — actually improves on the chances of making them happen.” Many of the side gigers that Palmer profiles wake up early — some as early as 4:45 — to work on their side job before going into their day jobs. You need passion to make that work.
If you wait to start a side business until you really feel like you’re ready, you could be waiting forever. Palmer writes that “Many side-giggers in this book discovered their side gigs almost by accident… Instead of slowing down and first building a Facebook page or stocking up on inventory, they said ‘yes’ to the opportunity in front of them.” Don’t wait. Look for opportunities in front of you — or make your own.
Don’t Undervalue Yourself — in Any Way
When starting a side gig, it can be easy to lowball your worth because you’re trying to get your business launched. One great thing Palmer pointed out is that this doesn’t just mean your worth in terms of money — it’s also your worth in terms of time. If you completely sacrifice things that really matter, like spending time with family, your side gig ultimately won’t be worth it.
There are a couple of changes I’d make to the book — some chapters have more example stories than necessary, and the section on common pitfalls to avoid when starting a side gig is a short appendix stuck in the back (it would be great if this section was much meatier). But overall, “The Economy of You” is a great starting point for anyone who wants to gain financial independence with a second income stream but hasn’t been sure how to begin.
You can buy The Economy of You” on Amazon.
Do you have a side gig? Why or why not?