Amid ever-increasing economic uncertainty, many people are turning toward income stacking. Workers, especially Gen Zers, are “taking on multiple jobs to build financial security” through a “side hustle or freelance work on top of a full-time job, or several part-time roles,” said CNBC.
Why is it more popular? The practice is not new, but it’s more common due to the rising cost of living. Also, Gen Z isn’t “buying into what they see as a broken social contract, where a linear path up the career ladder is the most reliable route to success and financial stability,” said Fast Company. For this generation, freelance employment is “modeled in the form of influencers, content creators and podcasters online.”
What are the benefits? The most obvious is extra income. It gives savers some wiggle room in their budgets to cover basic living costs or fund extras. It can also provide a safety net in the event of job loss, with an alternative income source to fall back on.
Used strategically, extra income can help with building wealth and go toward a “brokerage account, retirement savings or paying off the student loans that have been dragging you down financially,” said NerdWallet. As a bonus, juggling multiple positions can offer a shortcut to building skills and job experience, which can translate into further opportunities down the road.
Is income stacking right for you? The biggest consideration is whether you realistically have the time and energy. You might first take “steps like having a career conversation with your boss or maximizing the money you put into a health savings account,” said Vered Frank, a certified financial planner at StackWealth, to NerdWallet.
Before committing, make sure you understand what your added job will entail. It’s “easier to make income stacking work when you have a clear goal and timeframe in mind,” said Samantha Mockford, a CFP at Citrine Capital, to NerdWallet. “You may hate sacrificing sleep when you drive rideshare in the evenings, but it may be tolerable if it means being debt-free before the year ends.”
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