Can a side hustle help you stop living paycheck to paycheck? It can, with the right tools and a plan

If you’re living paycheck to paycheck, earning more can be one of the fastest ways to create breathing room in your budget. A side hustle or small business can help you generate extra income, build financial stability and reduce your reliance on debt when unexpected expenses come up.

Below are the best products and tools to help you start a side hustle, plus the smartest money move to make once that extra income starts rolling in.

There are countless ways to start a side hustle, and many of them require little more than skills or assets you already have. Freelancers often turn to platforms like Fiverr to offer services such as graphic design, writing, programming or social media management, while people with tools, equipment or other valuable items can earn passive income by renting them out on platforms like Hygglo.

If you love animals, pet sitting and dog walking can also be a flexible and profitable way to earn extra money. Many people get their start on Rover, which connects pet owners with sitters and walkers. As your client base grows, you can even eventually transition away from the platform so that you keep more of your earnings.

If your side hustle starts gaining traction and you have a plan for how you’ll generate more revenue, registering it as a small business can provide legal protections, help separate your personal and business finances and make it all look more professional.

We cover the process in detail in our guide to starting a business, but the short version is this: affordable business formation services like LegalZoom and Bizee can walk you through choosing the right business structure, such as an LLC or sole proprietorship, and handle the paperwork to register your business online. That way, you can spend less time navigating legal forms and more time growing your side hustle into something more.

Starting a side hustle can be a powerful way to break the paycheck-to-paycheck cycle, but it’s important to keep a few things in mind:

• Start small and avoid taking on debt in the beginning
• Focus on low-cost business ideas that let you test the waters before going all in
• Be patient, as most side hustles take time to generate consistent income
• Have a plan for the extra money you earn (more on this below)

If you decide to start a side hustle, have a plan for how the extra money you earn will be used, suggests Regina McCann Hess, CFP, founder and president ofForge Wealth Management.

“Without a plan, additional income can easily become part of everyday spending,” Hess says. “Instead, assign the income to a specific purpose.” That could mean paying down a credit card balance or simply keeping the cash set aside in a savings account so you have a financial cushion instead of relying entirely on your next paycheck.

To do this well, it may make sense to open a savings account dedicated only to the side hustle income you earn. This should be a high-yield savings account where you earn an above-average return and have your money accessible when you need it.

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