Part-Time Job vs. Side Hustle: Which is Better for You?

It seems like most of us are searching for ways to slash expenses and make more money these days.

In fact, according to Market Watch Guides, 54% of Americans have taken on a side hustle in the last year to supplement their primary source of income. So, if you are among the many who are struggling financially or just want to have some extra money to save for a rainy day, you may be considering getting a part-time job or starting a side hustle. But which one is best for you and your finances?

We break down the pros and cons of a part-time job vs. a side hustle and important factors to consider to help you decide which is better for you and your money goals.

Part-Time Job vs. Side Hustle: Key Differences

The main difference between a side hustle and a part-time job is that a side hustle typically allows you to work when you want, while a part-time job has a set schedule. That’s why I personally prefer having a side hustle rather than a traditional job.

However, depending on the type of side hustle you choose, it may not provide a stable income. With a part-time job, you will have a set number of hours you work every week, which means a consistent paycheck. That’s a big deciding factor when choosing between the two.

Another difference is how much you can earn. The employer caps the earnings of a part-time job, but in some instances, you may be able to quickly increase your earnings with a side hustle.

The average hourly rate for a part-time job will depend on where you live and the type of work you do. According to Talent.com, the average hourly pay for a part-time worker is about $15.46 per hour. On the other hand, some side hustles, such as virtual assisting and freelance writing, can earn $23 or more per hour.

Of course, the amount you will make will depend on the type of side hustle and how often you work. While these are the key differences between the two, there are many pros and cons to consider for each one as well.

Pros and Cons of a Part-Time Job

I’ve worked part-time jobs and had various side hustles, so I can tell you personally what is good and bad about each one. Which is better for you really depends on more than just money. So, let’s dive into the perks and drawbacks of each one to give you a better idea of which is right for you.

Pros of a Part-Time Job

Some companies have a lot to offer their part-time employees, which may make you decide it’s a better option than a side hustle. Here are the best aspects of having a part-time job:

Consistent Paycheck

A big perk of a traditional part-time job is you get a consistent paycheck. You know exactly how much you are going to make each week. Depending on which side hustle you choose, the income may be variable, which can be unpredictable and more difficult to budget.

Employer May Offer Benefits

Some companies offer health and retirement benefits to their part-time employees. When I worked part-time at the bank, I was able to open a 401k, get health insurance, and even had paid time off. This can be a massive perk if you don’t already have these types of benefits.

Job Stability

While there are seasonal part-time employees, if you get a job as a dedicated employee, then you have more job stability than a side hustle. Some side hustles require you to find your own clients, such as freelance writing, and this can cause a feast or famine situation for your income. This can be a major financial stressor, so it may not be optimal if you need consistency.

Set Schedule

This can be a pro for someone who finds it hard to stay motivated working their own hours with a side hustle. In most cases, an employer will assign you a specific shift so you know what hours you will work each week. Naturally, it will depend on the job whether you will have a set schedule or rotating shift, so make sure to discuss that during the interview.

Cons of a Part-Time Job

The pros of a part-time job can make it appealing, but some of the benefits can actually be cons as well. Before you start applying for a new job, consider these cons first:

Pay Is Limited

The fact that your pay is limited by your employer is a big bummer. Some companies may have salary caps, which means no matter what, you will earn the same hourly wage. That’s why I personally prefer having a side hustle. You are able to increase your wage with experience and actually do so pretty quickly.

You Can Be Prone to Layoffs

Although you may have more stability than a side hustle, you can still be prone to layoffs as a new part-time employee. I landed a sweet part-time job only to be laid off six weeks later due to budget cuts. So, although side hustles can mean variable income, I feel like I have more control over my career than with a traditional employer.

Not All Companies Offer Benefits

If you’re considering a part-time job because of the benefits, you should know that not all companies offer them. So you will have to search for an employer that does, and you will also need to meet their requirements to be eligible for them.

For example, some companies like the bank offer benefits to employees who work at least 20 hours a week, but other employers may require more hours to be eligible for various benefits they offer.

Pros and Cons of a Side Hustle

I love side hustles and have had quite a few myself. While I feel the pros outweigh the cons, a side hustle isn’t right for everyone. So, weigh these pros and cons before deciding.

Pros of a Side Hustle

A side hustle can be a game changer for your income and career. I was able to turn my freelance writing side hustle into my sole income. So, it can be a great way to turn your passion into profit. Here are some of the advantages of starting a side hustle:

Increase Your Pay Faster

Typically, employers only dish out a 3-5% salary increase per year. So, if you earn $15 an hour, that’s only a .45-cent pay increase per hour. That stings a bit. With a side hustle, you can boost your income much faster.

In fact, I was able to triple my rate within a year by landing a new client. As you gain experience with your side hustle you can increase your pay much faster than you would working a part-time job for someone else.

Freedom and Flexibility

This is an ultimate perk, as far as I’m concerned. With most side hustles, you get to call the shots. That means you can pick and choose when you work and, in some cases, where you work. For instance, as a freelance writer, I can work remotely anywhere with a Wi-Fi connection.

You can even become a dasher for DoorDash and work in multiple cities. So, if it’s your dream to travel or you just want to be able to earn money wherever you may roam, then a side hustle is for you.

You Can Have More Than One Side Hustle

Another awesome benefit of side hustling is you don’t have to stick with just one. Since you can pick and choose your hours, you can have two side hustles instead of working the same one or a part-time job you’re just not that into.

I actually had three side hustles before because I could work them when it was convenient for me. I was a Pinterest Virtual Assistant, a Freelance Writer, and I flipped items for profit on sites like eBay and Etsy.

I was able to create multiple income streams at the same time, so if one wasn’t earning much money, I could work the others to keep a steady flow of cash coming in. This can be a great option for anyone who gets burnt out doing the same thing all of the time too.

A Side Hustle Can Become Your Career

Rather than just clocking in and out for another employer, you can grow your side hustle into a career if you want. Imagine liking what you do for a living and making good money at it. For instance, if you love animals, you can start a side hustle pet-sitting, and eventually build it into a full-time business.

Or, if you dream of becoming a freelance writer working from home or by a lake soaking up the sun, you can do that too! If you find a side hustle that you love doing, it makes it much easier to work it into your dream career.

Cons of a Side Hustle

Now, while I could go on and on about how great side hustles are, I have to be transparent and warn you of their drawbacks, too. Here are some significant cons you should consider before you try starting one:

Income Can Be Inconsistent

While it can be easier to increase your pay, the income can be inconsistent at times. For example, as a freelance writer, you need to have dedicated clients and publications you work with to have money coming in consistently. But, you may have more work some weeks than others. It depends on whether you have a client who gives you consistent work per week or if you have to pitch articles to pubs on a regular basis.

The same goes for other types of side hustles. For instance, flipping items can earn you hundreds to thousands of dollars per month, but it depends on whether the items sell or not.

Delivering food depends on the amount of tips you make, and there may be more of a demand for pet sitters at specific times of the year. So, it all depends on various factors on how steady your income will be.

No Benefits or Paid Time Off

Something that sucks about side hustles is that you have no benefits whatsoever like you get with a part-time job. Health insurance and copays can get costly when you pay out of pocket. You also will need to set up your own retirement plans to participate in, and you won’t have the privilege of a 401k match like you do from an employer.

Another downfall is you don’t get paid vacation either. So, every day you take off will be unpaid. You need to consider these things when deciding between a part-time job and a side hustle.

You’re Responsible for Taxes

As a part-time employee, your employer will automatically deduct taxes from your pay. But when you work a side hustle, you will have to save back enough to pay the tax man when the bill comes due. Even companies like DoorDash hire you as an “independent contractor,” which means you are responsible for figuring out how much you need to save from your income.

The amount you will need to pay depends on your tax bracket but can be anywhere from 20% to 35% of your earnings. That can add up to a good chunk of cash, so keep that in mind before you begin a side hustle. Plus, it’s always better to save too much than not enough.

Important Factors to Consider When Choosing Between a Part-Time Job vs. a Side Hustle

So, now that you know the pros and cons of a part-time job vs. a side hustle, there are some main factors you need to consider that will determine for sure which is best for you.

Schedule and Flexibility

If you are already working a full-time job, then you definitely need to consider your schedule when deciding between a part-time job and a side hustle. Most of the time, employers need part-time workers to cover specific shifts, so the hours may conflict with your current 9-5 job.

So, you will need to find a job that will allow you to work shifts that are available when you are. A side hustle is something you can do whenever you have free time. It offers more flexibility than a part-time job, and you can choose what hours you want to work.

Income and Career Goals

What are your income goals? Do you want to be in control of increasing your pay, or would you rather have a steady paycheck without worrying how much you will earn each week? Which one you choose will determine if a part-time job or side hustle is better for you and your finances.

Another thing you need to consider is your career goals. If you’re looking to change careers and do something you enjoy, you may want to consider a side hustle. You can work on building your empire alongside your day job to eventually have a lucrative career you love. These are two major factors to consider when choosing which route to take.

If the Side Hustle Requires Start-Up Costs

Something about side hustles that may deter your decision to start one is whether it requires start-up costs and if you have the money for it. While there are some side hustles you can start without forking out money, like selling your own stuff or delivering for Doordash, others like freelance writing or pet sitting, may require various insurance policies to be in place before you begin.

You may have to pay out money before you begin making it, and that may not be ideal if you are already on a tight budget. However, you can try a side hustle that doesn’t cost much to start and then switch to another one you think you will enjoy once you make enough money to cover the costs.

Choose a Part-Time Job or Side Hustle that’s Best for You and Your Financial Needs!

Take a beat to really weigh the pros and cons of a part-time job and a side hustle, and consider factors such as your availability and career goals to help you pick which one is going to be the most beneficial to you.

Of course, you’re not stuck with one if you decide down the road it’s not for you, and you can always try out various side hustles to find a gig that you are passionate about that boosts your bank account quickly!