Side Hustle or Safe Stream? Here’s the Important Difference That’s Losing You Money

Side hustles have become incredibly popular over the last few years. These income streams started off gaining traction during the pandemic, when employees working from home used their free time to work on passion projects.

It turns out, those passion projects could gain some cash flow! And that’s awesome! But what’s less awesome is that many of these side hustles may have become chores rather than a fun part of your spare time.

Back to work

When employees went back to the office, many didn’t have the time to keep working at their passion projects. And herein lies the big problem. While a passion project is nice, with a solid little side hustle going on, once it becomes a chore, it’s work — not a passion project.

What’s more, these side hustles can take away from the job that gives you a salary — the job paying the bills day after day. If you’re responding to messages for products while you should be working, your boss will notice. And that could lead to you losing a job or at even a promotion — something that would bring in thousands of dollars.

What’s more, side hustles usually cost you money. If you’re creating a product or even designing something online, you usually have to at least pay a fee, if not buy products outright. Drop shipping, a popular option, costs you tons of cash to bring in products that you may or may not sell! So, you’re losing money instead of gaining it.

That’s why I don’t like side hustles for making passive income. It’s simply not passive but incredibly active. If you want to make a living this way, that’s your call. But if you’re looking for truly passive income, I’d try this instead.

Passive-income options

Rather than lose cash on buying products people may not buy, there are a lot of other passive-income stream methods. But the first? Get really good at your job — not for a promotion but to change jobs.

An Indeed study in the United Kingdom found that workers received an average of a 9.5% increase in their salary when switching jobs. In fact, it’s been found that workers should try and switch their jobs every two to three years. This is the easiest way to create more responsibilities for yourself, further your career, and, of course, create more income.

And this is incredibly passive. All you’re doing is signing on to a new company from the work you already do! And a 9.5% increase? That could turn a $50,000 wage into $54,750!

Start investing

Of course, this is the Motley Fool, so we can’t forget that another of the easiest ways to create passive income is through investing. Finding great dividend producers with stable returns is an ideal way to create easy and long-term passive income that lasts.

One strong option to consider is Great-West Lifeco (TSX:GWO), an asset manager umbrella with a number of asset managers and insurance providers. The company has moved from keeping its cash stable to creating growth opportunities, allowing investors to look forward to higher returns in the future.

Right now, however, you can grab a dividend yield at 5.25%! That translates to $2.08 per share annually. If you’re looking to create passive income, then this is what your shares could look like from a $5,000 investment, with dividends and returns taken into account:

Add the returns from your investment and the passive income from dividends, and you would have $5,510. That’s passive income of $510 in the first year!