Legendary investor Warren Buffett famously said, “Never rely on a single source of income.” Diversifying income streams can be crucial, especially when a sector goes through a downcycle, providing something to fall back on.
With new skill-based gigs emerging as viable options for generating income, more young professionals are now seeking jobs they can do in their spare time. Here’s a look at how some are pursuing their passions while creating additional income streams.
Raina Jain, a 32-year-old finance professional based in Mumbai, has been balancing a side hustle with her regular job since January 2021. While she spends her weekdays working for a media and entertainment company, she devotes her weekends to her passion as a professional organizer.
Alongside her business partner, Jain has steadily expanded this venture, building a small team that now handles projects even during weekdays.
“When I first started, weekends were the only time we could take on projects, and weekdays were meant to brainstorm on building content and awareness,” said Jain. “We launched during the pandemic, so our early efforts were focused on building awareness on organizing through social media.”
Jain started her side gig to establish a financial safety net for contingencies, as a well as build an education fund for her then eight-month-old daughter, besides bolstering her retirement savings.
At present, the organizing business accounts for 20% of her monthly salary.
She invests in mutual fund via systematic investment plans (SIPs), and actively manages her own stock portfolio, leveraging her qualifications as a chartered accountant. Equities make up 80% of her portfolio.
She has a health insurance policy from her employer with a base coverage of ₹10 lakh, and an additional top-up cover of ₹15 lakh. Jain also has substantial life insurance coverage from her employer.
Jaipur-based Rachna Ghiya, 37, who works as a freelance e-learning developer, recently started exploring pottery, as she sought to constantly upskill and learn new activities.
“I was curious about pottery. So, I opted for a four-and-a-half-months foundational course in Bengaluru, just to see whether it is something that I would enjoy doing,” she said.
Ghiya decided to turn her craft into a business after her pottery sold out at an exhibition in Bengaluru, which featured work from course participants.
She has consistently managed her finances well, knowing that freelancing can result in unpredictable earnings.
“While I have established myself by now in the e-learning space and even get projects through word-of-mouth, I need to maintain sufficient liquidity in my finances to fall back on during lean months. Hence, I try and keep at least six months’ worth of expenses in my savings account at any given point in time,” she added.
Through pottery, Ghiya currently earns 15% of what she makes from her learning and development work.
Her investment portfolio consists of 75% equities, primarily in mutual funds and partly in direct stocks, while 25% is in debt instruments. Ghiya has a health coverage of ₹20 lakh.
She spends at least ₹1.5-2 lakh every year on upskilling, in addition to buying software licences required for her learning and development work.
Running a pottery business also involves costs. For instance, a pottery wheel costs around ₹50,000, while a kiln comes for ₹2.5-5 lakh. Currently, Ghiya pays other kiln owners ₹1,500-2,000 per firing. For each firing, a kiln can accommodate 15-20 pieces, depending on their size.
Ghiya believes she can gradually scale up her pottery business, which would diversify her income streams and help manage income fluctuations associated with freelancing.
Yoga trainer
Bengaluru-based Alisha Sharma, 29, who works as a project manager, earned a professional yoga teacher certification last year.
Sharma has been interested in yoga for years and has practiced it for the past six years. Now, she plans to expand it into a larger venture.
“It was a calling for me. It was not just about the physical aspects of Yoga, but even the theory around it interested me a lot. I thought this is one tool that can also help others. Hence, I decided to take the teacher certification last year.”
Sharma said she wants to grow her venture slowly and organically, without rushing the process. “I want to enjoy it as a passion right now. The additional income stream will slowly allow me to improve my lifestyle. I also hope it helps me reach my other financial goals.”
Sharma is also focused on educating herself to make better financial decisions. “I am doing SIPs in mutual funds, but I need to increase it.”
She has employer-provided health coverage of ₹7.5 lakh. However, her employer does not offer life insurance, and Sharma is yet to buy a personal life insurance policy.
Bengaluru-based Pramod Pratap, 31, works at a digital marketing agency and is also a professional drummer. He had a passion for drumming since a young age.
“With years of practice, I have developed my drumming skills, which is now helping me with additional income.” In a good year, drumming can account for 30-35% of the salary, Pramod added.
Since 2014, Pramod has been playing professionally, alongside his regular job. Now married, he aims to channel most of his additional income into mutual fund investments.
Pramod and his wife plan to gradually build a corpus to support themselves when they decide to start a family. “I have been running SIPs in equity MFs since 2018 with the help of a mutual fund distributor, but now as a couple we want to get more serious about our finances."
They are also considering starting their own business. His current asset allocation is 70% equities and 30% debt.
He holds an individual health insurance policy with a coverage of ₹7 lakh, which he plans to replace with a family floater plan. Additionally, he has a ₹1-crore term life insurance policy.
Gayathri Jinoj, a 41-year-old bank employee from Thiruvananthapuram, Kerala, runs a hand-embroidery business called Knots&Crosses. The business offers customized embroidery services and embroidered clothing for women. She currently uses social media platforms to sell her creations.
Gayathri started the business in 2018 out of passion, and it has since grown through word-of-mouth. She has gradually built a small team, mostly consisting of friends, who assist her with the business.
Right now, the business is running on marginal profits, said Gayathri. "I also wanted to help other women, who needed an income stream to support their families. Whoever in my team picks up the work, they are compensated on a project-to-project basis.
She plans to expand her business to a physical location sometime next year, focussing on increasing profit margins to offset higher rental costs, and has recently enlisted a friend to help with marketing.
According to Gayathri, the additional income can even help match her income as a banking employee, but for now, the embroidery business accounts for about 18% of her bank salary.
She would like to use the extra income to invest for the education of her seven- and 10-year-old daughters.
She invests in mutual funds through SIPs, with an asset allocation of 60% in equities and 40% in debt. She has a life insurance cover of ₹65 lakh and health insurance cover of ₹10 lakh through her employer.
A skill-based gig unrelated to one's primary profession can be valuable during downturns in the main job. Unlike traditional employment, these gigs don’t have a set retirement age, allowing individuals to continue with the activities and earn a steady income even during post-retirement years and support future goals.
