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Many of us have had that moment where we think, “I need to earn more money.” If you are feeling the pinch of rising expenses plus a static income, you might consider getting a second job to boost your monthly take-home pay.

You’re not alone. According to the Federal Reserve Bank of St. Louis, 8.4 million people in the U.S. have multiple jobs, which is more than 5% of the workforce. That figure, however, may not capture the full impact of the Gig Economy, and all of those who sometimes hop behind the wheel of an Uber or otherwise do freelance work.

Working more than one job can help you save money, but it can also be a challenge. To help better understand the pluses and minuses of moonlighting, read on.

What Is Moonlighting?

Moonlighting is defined as taking on a secondary job in addition to a primary full-time job. (Typically, second jobs were done at night, by moonlight, after one’s day job.) That extra job might require you to be on-premises, or it could be a project that can be done from home.

These days, some people use the term loosely. You might hear someone say, “I moonlight editing college application essays” or “I moonlight now and then at a catering company.” The hours may be variable and flexible, but it’s an additional form of employment that brings in money, potentially helping an individual to create financial freedom.

Generally, as long as moonlighting doesn’t impact an employee’s performance while they’re on the clock, employers will allow moonlighting. However, company rules, such as a non-compete policy, could bar full-time employees from moonlighting jobs in similar industries.

Having a second job can accomplish a variety of goals, from adding money to your bank account, to paying down credit card debt to funding a new car purchase to buying a home.

How Does Moonlighting Work?

Moonlighting jobs can take many different forms. Typically, it’s a part-time job in addition to full-time work. It may or may not be related to your primary job. For instance, it could include any of the following possibilities:

•   Waiting tables on the weekend, outside of a 9 to 5 job

•   Working as a music teacher in a school, but teaching private music lessons after hours

•   Taking on gig work, like food delivery, outside of working hours

In some cases, moonlighting may offer some of the best ways to make money from home. In your spare time, you might tutor, design websites, edit copy, make jewelry, analyze data, or do any number of other tasks.

Having a second job or moonlighting typically involves dedicating some time and energy to the pursuit on a regular basis. In this way, it differs from passive income ideas, which could include buying stocks and receiving dividends or renting out a room in your home.

Reasons Why People Take a Second Job

People may take on moonlighting work for any of the following reasons:

•   Financial. Bringing in more income could help pay off debt faster.

•   Personal. A moonlighting job may allow someone to explore an area of interest more seriously or provide an antidote to a boring but profitable day job.

•   Professional. People who moonlight may learn new skills that benefit them in their full-time work or help them switch industries entirely.

Recommended: How to Earn Residual Income

Pros of Working a Second Job

While working two jobs will take more of your time and energy, there are definitely benefits to doing so. Here’s a closer look at the pros:

More Money

No surprise here: One of the most immediate (and most sought-after) benefits of moonlighting is earning additional income. Having some extra cash can help when you’re budgeting for basic living expenses, especially in times of high inflation.

Beyond that, the additional cash can allow you to do anything from paying off debt faster to opening a high-yield savings account and building an emergency fund to starting a travel fund for vacations.

New Skills or Benefits

Have you been thinking about switching to another line of work, like retail? Working in a store on Sundays could let you see if it’s a good fit. Or is there a project, like web design, that you dream of making your full-time career? Freelancing at that pursuit a few nights a week might lay the foundation. Moonlighting work doesn’t necessarily have to be related to a person’s full-time job, so it can be a great tool to explore a hobby or interest with less risk. You can build your resume and hone your talents.

Moonlighting work may also provide benefits a full-time job doesn’t. If someone is passionate about art, they may take a moonlighting job at an art store to score an employee discount, saving them money on their hobby.

Less Financial Stress

If you’re anxious about money, join the club. One recent survey found that a stunning 65% of Americans say that money is their biggest source of stress. An additional job could be a way to achieve financial security, as you’re not relying solely on one employer for all of your income.

The money you make moonlighting might be a way to pay off debt faster without using savings, whether that means whittling down your student loans or a credit card balance. You could save it and decide where to keep an emergency fund in case an unexpected major bill comes along. Or you could funnel the funds into a retirement account. In any of these situations, the extra money can help increase your financial fitness as well as your peace of mind.

Cons of Working a Second Job

Taking a second job can be enticing for the extra income alone, but that doesn’t tell the whole story. There are some cons to working two jobs that it’s wise to consider before you begin moonlighting. For some, the following downsides may prove to outweigh the benefits.

Less Time for Self, Friends, or Family

More work will mean less free time. Losing that free time could disrupt your ability to maintain work-life balance while increasing your stress. Not having time to see friends and family or pursue hobbies could have a negative effect on your wellbeing.

Increased Physical and Mental Tiredness

Working two jobs, whether physically demanding or not, can lead to exhaustion. Without the time to recharge and rest, moonlighters may experience burnout.

Reduced Focus at First Job

If moonlighting leaves you exhausted or distracted, it could cause you to be less successful at your primary job. This, in turn, could jeopardize your main income stream.

Violating company guidelines

Moonlighting can put your main job in danger if you go against existing guidelines. Let’s say you are a lawyer for one company, and you signed a non-compete agreement. If another company asks you to review some documents for them as a freelancer, doing so could be problematic.

More paperwork

As you begin earning income for your second job, you will need to keep track of that money, any expenses you incur while working, and what taxes you owe.

Tips to Make Working Two Jobs Work

There are pros and cons of working two jobs. However, if you choose your additional work carefully, moonlighting can be a successful endeavor. Consider these tips when searching for moonlighting work:

•   Pick a passion. When a second job is boring, it might be more exhausting. Instead, consider a gig you are passionate or excited about as your moonlighting gig.

•   Start small. Taking on too many hours of moonlighting work upfront can lead to burnout. Try starting small, with only a few additional hours a week or even a seasonal position. If it goes well, you can ramp up your hours.

•   Double-check employer policy. Before signing up for a moonlighting job, check with policies at your full-time position. There could be non-compete or conflict-of-interest clauses that prohibit employees from working in certain fields. It can be best to follow these guidelines when you’re pursuing additional hours elsewhere.

•   Keep good records. It’s possible that your moonlighting job will be handled as a W-2, meaning your employer takes out taxes, but it’s likely this is freelance or contract work that involves an IRS Form 1099. Keep careful track of earnings, expenses, and when estimated taxes are due and for how much.

The Takeaway

Taking on a second job, or moonlighting, can be a great way to earn some extra cash and bulk up your bank account when money is tight or you want to save towards a specific goal. This kind of additional work can also help you explore a personal interest that might blossom into a new career direction.

However, working a second job, even if it’s a small commitment of hours, can throw your work-life balance out of whack, so proceed with caution to avoid burnout. The goal is to amp up your earning power, not exhaust you.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with eligible direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

FAQ

Is it unhealthy to work 2 jobs?

Moonlighting can be challenging for individuals who already struggle with work-life balance. With two jobs, it may be hard to pursue a personal life or relax. It might be wise to start a second job with a small commitment of time, see how it goes, and then gradually add more hours.

How do I survive 2 jobs?

Surviving two jobs may hinge on setting boundaries for both, as well as finding enjoyable work that’s not too physically or mentally taxing. Self-care is obviously important. Another consideration is making sure that you are not violating any non-compete or conflict-of-interest guidelines at your primary job so as not to jeopardize your status.

How does tax work for 2 jobs?

If both jobs are W-2, not contract, the employers will withhold taxes for the employees. However, if for your moonlighting job, you receive a 1099 as a contract worker, you should set aside and pay your own taxes. Also, taking on two jobs could boost you into a higher tax bracket, which could mean being taxed at a higher rate.

Is it illegal to work two jobs?

Unless explicitly stated in a job offer or contract, it is not illegal to work two jobs. Do make sure you are not violating any non-compete or conflict-of-interest stipulations at your primary job. Also know that most contracts are “at will,” meaning an employer has the right to fire an employee if a second job interferes with their performance.

Photo credit: iStock/Phynart Studio

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

This article is not intended to be legal advice. Please consult an attorney for advice.

SoFi Checking and Savings is offered through SoFi Bank, N.A. Member FDIC. The SoFi® Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

3.30% APY
Annual percentage yield (APY) is variable and subject to change at any time. Rates are current as of 12/23/25. There is no minimum balance requirement. Fees may reduce earnings. Additional rates and information can be found at https://www.sofi.com/legal/banking-rate-sheet

Eligible Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Eligible Direct Deposit”) via the Automated Clearing House (“ACH”) Network every 31 calendar days.

Although we do our best to recognize all Eligible Direct Deposits, a small number of employers, payroll providers, benefits providers, or government agencies do not designate payments as direct deposit. To ensure you're earning the APY for account holders with Eligible Direct Deposit, we encourage you to check your APY Details page the day after your Eligible Direct Deposit posts to your SoFi account. If your APY is not showing as the APY for account holders with Eligible Direct Deposit, contact us at 855-456-7634 with the details of your Eligible Direct Deposit. As long as SoFi Bank can validate those details, you will start earning the APY for account holders with Eligible Direct Deposit from the date you contact SoFi for the next 31 calendar days. You will also be eligible for the APY for account holders with Eligible Direct Deposit on future Eligible Direct Deposits, as long as SoFi Bank can validate them.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, Wise, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi Bank shall, in its sole discretion, assess each account holder's Eligible Direct Deposit activity to determine the applicability of rates and may request additional documentation for verification of eligibility.

See additional details at https://www.sofi.com/legal/banking-rate-sheet.
*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.

SOBK-Q224-1945809-V1

Bank transaction deposits are monetary deposits made into transaction accounts, also often known as checking accounts. Transaction deposits allow a person to have ready access to their money held at a depository financial institution, such as a bank or credit union, without delay or advance notice.

They differ from non-transaction deposits, which are deposits made into non-transaction accounts, such as certificates of deposit (CDs). Non-transaction accounts come with restrictions on when or how often you can access your money. Learn more about transaction deposits and their pros and cons here.

What Are Transaction Deposits?

A transaction deposit (sometimes also called a demand deposit) refers to a deposit made into a transaction account that is readily available for use — meaning you can use the money any time for other transactions.

The most common example of a transaction account is a checking account. This type of account allows account holders to make unlimited deposits, withdrawals, payments, and transfers. In other words, you can use the account as often as you want to get cash, make purchases, pay bills, and/or deposit cash at an ATM.

Savings accounts that allow account holders unlimited access are also considered transaction accounts. Typically, however, savings accounts may come with withdrawal and transfer limits (such as a certain number per month). As a result, they are generally considered non-transaction accounts.

💡 Quick Tip: Don’t think too hard about your money. Automate your budgeting, saving, and spending with SoFi’s seamless and secure mobile banking app.

Understanding Transaction Deposits

Transaction deposits can be made at a branch of the bank, at an ATM, and by transferring funds from another account. If you set up direct deposit with your employer, these deposits also qualify as transaction deposits.

If you want to access a transaction deposit, you can so for in a number of different ways, including:

•   Withdrawing money at a branch or ATM

•   Transferring the money to another account

•   Writing a check

•   Using auto-pay

•   Making a wire payment

Transaction Deposits vs Non-Transaction Deposits

To better understand transaction deposits, it helps to know the difference between the two main types of deposit accounts: transaction accounts and non-transaction accounts.

Transaction accounts allow account holders easy access to their money. These accounts may earn interest, but typically they do not.

Non-transaction accounts, such as most savings accounts, money market accounts, and certificates of deposit (CDs) typically earn interest, providing a return on the account holder’s investment. However, deposits made into a non-transaction account (called non-transaction deposits) are not as fully accessible as transaction deposits. Account holders may be limited or restricted from accessing all or some of the money, or they may need to make a request for a withdrawal.

For example, if you open a CD, your money is locked up for a certain period of time. If you want to access the money before the CD matures, you will typically pay a penalty. With many savings and money market accounts, the bank will impose limitations on the number of transactions you can make each month. If you exceed that limit, you may be charged withdrawal fees.

Here’s a look at transaction accounts vs non-transaction accounts:

Real-Life Examples of Transaction Deposits

A checking account is an example of a transaction account where transaction deposits are made. The key feature of a transaction account, and the deposits made into it, is that the money is liquid, or readily available. There are no requirements for leaving the money for a set amount of time like there are with a time (or term) deposit account, such as a CD.

Here are some common examples of transaction deposits:

•   Direct deposits from your employer into your account

•   Check or cash deposits made at your bank

•   Mobile deposits

•   An electronic funds transfer (EFT) made into your account

•   Payments from third parties

•   Refunds from vendors

Restrictions of Transaction Deposits

There are some instances, however, where a bank may impose some restrictions or a waiting period on certain deposits made to transaction accounts. This could happen if you deposit a large check that requires verification, or if the account is new and the account holder doesn’t yet have an established history. Once the holding period ends, the funds are fully accessible.

Non-transaction deposits, however, come with far more restrictions. In the past,
The Federal Reserve’s Regulation D restricted withdrawals from money market accounts and savings accounts to six per month. If you went over this limit, the bank would charge you a fee. If you consistently went over this limit, they could convert the account to a regular (non-interest-bearing) account.

However, the Federal Reserve suspended Regulation D in 2020. Banks can now set their own restrictions on savings account transactions, and they can vary from one bank to another. In other words, some financial institutions still limit savings accounts to those six transactions; check with your bank or read the fine print on your account agreement.

Recommended: How Long Does the Direct Deposit Transaction Take?

Advantages of Transaction Deposits

There are a number of advantages that come with transaction deposits. These include:

•   Money is readily available

•   No maturity period

•   No eligibility restrictions

•   No limit on the number of deposits, withdrawals, or transfers the account holder can make

•   No early withdrawal penalties

•   Sometimes interest-bearing

Disadvantages of Transaction Deposits

The main disadvantage of transaction deposits is that the money being deposited will generally earn no, or only a small amount of, interest.

The Takeaway

A transaction deposit is a deposit made to a transaction account, such as a checking account. This type of account is ideal for everyday banking, since you can generally put money in and take money out whenever you like.

Non-transaction deposits are the opposite — they are funds put into non-transaction accounts, which include savings accounts, money market accounts, and CDs. With a non-transaction account, you will face some restrictions in when and how often you can access your money. However, the advantage of non-transaction deposits is that this money will typically earn more interest than a transaction deposit will.

If you’re interested in getting the benefits of both types of accounts in one, consider what SoFi offers.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with eligible direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

FAQ

What is a bank deposit transaction?

A bank deposit transaction is a deposit into a transactional bank account, such as a checking account. It includes direct deposits, transfers, and deposits made at a bank or ATM.

Is a deposit considered a transaction?

Yes, a deposit is considered a transaction. Any money moving into and out of your account is considered a transaction.

What banks offer transaction deposits?

Any bank that offers a checking account is a bank that offers transaction deposits.

Photo credit: iStock/Prostock-Studio

SoFi Checking and Savings is offered through SoFi Bank, N.A. Member FDIC. The SoFi® Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

Annual percentage yield (APY) is variable and subject to change at any time. Rates are current as of 12/23/25. There is no minimum balance requirement. Fees may reduce earnings. Additional rates and information can be found at https://www.sofi.com/legal/banking-rate-sheet

Eligible Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Eligible Direct Deposit”) via the Automated Clearing House (“ACH”) Network every 31 calendar days.

Although we do our best to recognize all Eligible Direct Deposits, a small number of employers, payroll providers, benefits providers, or government agencies do not designate payments as direct deposit. To ensure you're earning the APY for account holders with Eligible Direct Deposit, we encourage you to check your APY Details page the day after your Eligible Direct Deposit posts to your SoFi account. If your APY is not showing as the APY for account holders with Eligible Direct Deposit, contact us at 855-456-7634 with the details of your Eligible Direct Deposit. As long as SoFi Bank can validate those details, you will start earning the APY for account holders with Eligible Direct Deposit from the date you contact SoFi for the next 31 calendar days. You will also be eligible for the APY for account holders with Eligible Direct Deposit on future Eligible Direct Deposits, as long as SoFi Bank can validate them.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, Wise, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi Bank shall, in its sole discretion, assess each account holder's Eligible Direct Deposit activity to determine the applicability of rates and may request additional documentation for verification of eligibility.

See additional details at https://www.sofi.com/legal/banking-rate-sheet.
*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

SOBK-Q224-1939779-V1

Having a side hustle has become increasingly popular. According to one recent study, 54% of Americans said they have taken on a side hustle as a way to supplement their income.

And why not? Everyone likes a little extra cash in their pocket, especially if it’s from an activity they enjoy. Whether a side hustle involves using your tech skills to help people set up their computers or selling photos you take, it can be a great way to build an additional revenue stream.

But beyond the cash, there are other, potentially surprising benefits to having this kind of money-making venture.

What Is a Side Hustle?

A side hustle is a job or work, in addition to full-time employment, that helps boost an individual’s monthly income. It can involve ways to make money from home (say, as an online tutor or writer) as well as a part-time job outside the home.

For instance, maybe you do some pet-sitting when people in your town go on vacation. Or perhaps you have a Sunday gig as a barista. Or maybe you hunt for treasures at local yard sales and resell them on eBay or Etsy. These are just a few examples of side hustles, which can help you earn extra cash that you could use to pay bills or put into a bank account.

The amount Americans earn via a side hustle varies tremendously, as you might expect. Another recent survey of individuals with side hustles found that the average side hustle brings in about $688 a month. However, approximately 46% of people say they earn less than $250 a month from their side. About 19% say they make more than $1,000 a month.

Having a Side Hustle: 11 Benefits

An obvious benefit of a side hustle is the potential to generate extra cash each month. But on top of earning money, there are additional advantages to taking on extra work outside the typical 9-to-5.

If you’re wondering, “Should I start a side hustle?” read on and explore the unexpected benefits below.

1. Improving Ability to Budget

Having a solid budget is one of the important ways to improve your financial health. But getting that budget in place can be a challenge when money is tight, and it’s a struggle to make ends meet each month.

A side hustle has the potential to bring extra income, creating a little wiggle room in your budget. Creating a realistic budget may be easier with some more padding each month.

2. Developing Skills That Translate to Other Areas

Learning new skills is one of the more unexpected benefits of a side hustle. If a side hustler is starting to drive a ride-share, for instance, they may get a crash course in accounting as they learn to manage this income stream. Or if a side hustler’s gig is working weekends at a local café, they could develop important customer service skills they normally wouldn’t cultivate at their day job.

In other words, taking on an additional work endeavor can help you develop a more robust toolkit for future endeavors.

3. Improving Income and Financial Stability

Most people start side hustles to earn extra cash, and that benefit can’t be overstated. Additional monthly income can help give side hustlers a sense of financial stability. It could translate into less stress when the bills are due or even create a little breathing room to start saving and planning for the future.

With surplus cash in the budget, it may be time to set up a financial plan if you haven’t already. While it may be tempting to have fun spending the extra money, those funds could be put to work to help you build wealth.

4. Building a Stronger Work Ethic

Side hustles can be fun, but they are still a job. Spending more hours working can enhance your work ethic. After all, you are devoting what others might consider leisure time to a pursuit that will uplift your financial health. You should recognize your dedication and bask in the self-confidence boost you get along with the additional cash.

5. Improving Time Management Skills

It may be obvious, but taking on a side hustle means taking on more work hours. That translates into fewer free hours in the day, which means a side hustle can be a crash course in time management skills as well as cash management know-how.

With more responsibilities on your plate, you will likely get much more adept at being on time, meeting deadlines, and knowing how to pack in leisure activities in the time available. These are skills that will serve you well outside your side hustle.

6. Allowing You to Put More Into a Savings Account

Some start side hustles to help pay off outstanding debt or save for an upcoming trip, but earnings can be used to build up savings.

Once immediate financial needs are met, including bills and debt, surplus cash from a side hustle can go into a savings account. Not sure where to park your cash? Consider a high-yield bank account to help build your savings.

7. Allowing You to Better Prepare for an Emergency

One of the benefits of a side hustle is the ability to contribute to an emergency fund. As noted above, once immediate needs are met in a budget, extra cash from a side hustle could go into a savings account or help you grow your emergency cash supply.

A general recommendation is to have at least three to six months’ worth of basic living expenses set aside in an easily accessed account. This gives you a cushion if an unexpected medical or household expense crops us or if you were to lose your job.

8. Allowing You to Pay Debt Quicker

If high-interest debt is eating away at paychecks, money from a side hustle can be a help. Interest from high-interest credit cards can compound, for example, making it harder to pay off as the balance grows. The current average credit card interest rate (as of mid 2024) is 24.62%, which can mean that those carrying a balance may have a challenging time paying debt down. With limited income, it may feel impossible to get on top of that monthly bill.

Using income from a side hustle to pay off debt could lead to paying it off faster or at least relieving some of the pressure.

9. Improving Ability to Reach Financial Goals

Even an extra $100 a month can help side-hustlers as they work to reach financial goals.

For example, if you’re planning a vacation in the next year but don’t have enough in your budget to save for it, you could take on seasonal gig work and put those paychecks towards the vacation. Without it, you might not be able to take the vacation.

Beyond small savings goals, a side hustle can help you work towards bigger financial goals like saving for a downpayment or putting more money into a retirement fund.

10. Allowing You to Expand Your Network

One of the less-discussed benefits of a side hustle is the ability to meet new people and expand your network. Whether a side hustle is related to your day job or is something completely different, you’re bound to meet new people and create new connections.

These connections may lead to many benefits, including more work, new friends, or a new career opportunity.

11. The Opportunity to Do Something You Love

In addition to bringing in more money, a side hustle can also reignite someone’s passion for a hobby or activity.

Because it’s not your primary source of income, you can experiment with turning a personal interest into an income source. If you don’t enjoy your side hustle, it can feel exhausting. But working on something you love might not even feel like work.

For example, a nurse might love quilting in their off time and decide to open an Etsy shop. If they were already using their spare time to quilt for family and friends, now they can keep doing what they love, earn money from home, and make a profit off the sale of their quilts. It’s a win-win! Who knows? Some side hustles even become a person’s main job over time as their network and their skills grow.

The Takeaway

While the biggest benefit of a side hustle is bound to be the extra cash it brings, there are plenty of secondary benefits. From plumping up an emergency fund to meeting new people, a side hustle can be both a key to financial freedom and an avenue for exploration and personal growth.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with eligible direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

FAQ

Why is a side hustle important?

Having a side hustle can generate more income and help people pursue something they’re passionate about on the side. It also can build skills and open up new networks and opportunities.

Is it worth having a side hustle?

If someone has a side hustle they enjoy and it generates extra income without taking up every last minute of their day, it may be well worth it. However, deciding if a side hustle is worth it is ultimately up to the individual.

How much does the average side hustle make?

The average side hustle brings in about $688 a month, according to one recent survey, though 46% of those with a side hustle report they earn less than $250 monthly. Even so, a couple hundred dollars is a nice sum to help pay off student loans or credit card debt faster, or to put towards a vacation fund.

Photo credit: iStock/visualspace

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

SoFi Checking and Savings is offered through SoFi Bank, N.A. Member FDIC. The SoFi® Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

3.30% APY
Annual percentage yield (APY) is variable and subject to change at any time. Rates are current as of 12/23/25. There is no minimum balance requirement. Fees may reduce earnings. Additional rates and information can be found at https://www.sofi.com/legal/banking-rate-sheet

Eligible Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Eligible Direct Deposit”) via the Automated Clearing House (“ACH”) Network every 31 calendar days.

Although we do our best to recognize all Eligible Direct Deposits, a small number of employers, payroll providers, benefits providers, or government agencies do not designate payments as direct deposit. To ensure you're earning the APY for account holders with Eligible Direct Deposit, we encourage you to check your APY Details page the day after your Eligible Direct Deposit posts to your SoFi account. If your APY is not showing as the APY for account holders with Eligible Direct Deposit, contact us at 855-456-7634 with the details of your Eligible Direct Deposit. As long as SoFi Bank can validate those details, you will start earning the APY for account holders with Eligible Direct Deposit from the date you contact SoFi for the next 31 calendar days. You will also be eligible for the APY for account holders with Eligible Direct Deposit on future Eligible Direct Deposits, as long as SoFi Bank can validate them.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, Wise, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi Bank shall, in its sole discretion, assess each account holder's Eligible Direct Deposit activity to determine the applicability of rates and may request additional documentation for verification of eligibility.

See additional details at https://www.sofi.com/legal/banking-rate-sheet.
*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.

SOBK-Q224-1939801-V1 Read more

The biweekly money-saving challenge requires putting away cash for 26 weeks or every other week for one year. The amount you choose to save can vary based on your goals and comfort level. This method not only helps you accumulate savings, it also encourages you to develop consistent savings habits over time.

Types of Biweekly Money-Saving Challenges

If you’re paid bi-weekly, the biweekly money-savings challenge might suit your lifestyle best. It’s budget friendly, too. So if you have a little or a lot of change after bills, you can adjust this plan to meet your needs.

26-Week or Biweekly Savings Challenge

There are many versions of this challenge. You can start with a small savings amount, like $3 or $4. If you choose the first amount, put $3 away in savings the first week. Every two weeks, add an extra $3 to the last amount you put away. So, the first week, you’ll put away $3. The second week, $6. The third week, $9. At the end of the 26-week challenge, starting with $3, you’ll have $1,053 in savings.

Or you might prefer a fixed savings goal, like $5,000 or $10,000. If that’s you, put away between $193 to $385 every two weeks. You’ll end up with $5,018 or $10,010, respectively.

Need help monitoring your finances? A money tracker can help you keep tabs on your spending and your credit score.

How to Choose a Money-Saving Challenge

Choose a financial challenge that works with your budget and meets your goals. Setting goals and starting small can be a big win in many ways. It lays the building blocks for long-term savings habits that last over time.

Find a challenge that is budget-friendly. The amount you put away can be as little as a nickel on day one. If you have more change to spare, you can put away more money. Some challenges suggest multiple savings accounts or stashing cash. If you choose to open multiple accounts, keep in mind that interest-bearing accounts typically earn some returns, are FDIC-insured, and can be accessed for emergencies or planned expenses.

You might have specific financial goals, like an emergency or wedding fund. Or you might want to build a habit of saving. Whatever your goal, a challenge can help you commit to saving $500 to $15,000 in a set amount of time — and potentially build a good habit in the process.

Common Money-Saving Challenges

Money-saving challenges are smart saving strategies or smart spending strategies, depending on the process. They can show you how to save up money fast or how to save money, period.

And there’s no shortage of creativity. Google has about hundreds of thousands of pages worth of money-saving challenges. You can even try saving $2,023 in the 2024 money-saving challenge. Below is a list of money challenges to get you started.

100 Envelope Challenge

Number 100 envelopes from 1-100. Each day, put in the amount of cash listed on the envelope. By the end of 100 days, you’ll have $5,050 stashed away.

In a variation, 100 days can be broken down into 13 weeks for easier deposits. The last week is four days. Every other week, set aside the week’s total of savings. Below’s chart lays out the amounts:

Holiday Helper Fund

The holidays sneak up on us quicker than we think. If you’re planning your annual budget, set up an account or an envelope for gifts. Setting aside an extra fund for gifts, whether holiday, wedding, or general, keeps money out of sight and mind until you need it.

On the week of January 1, set aside $20 every week, or $40 every two weeks. By December 25th, you’ll have $1,040.

52-Week Savings Challenge

The concept is simple. You set aside $1 at week one. Then $2 at week two. By the end of 52 weeks, you’ll have saved $1,378. You can also start with $2 or $10 on week one, $4 or $20 on week two, and so on. You’ll end up with $2,756 for the $2 challenge or $13,780 for the $10 challenge.

Another variation keeps the weekly savings contribution a fixed amount, which can be particularly helpful for smaller budgets. For example, you can put away $10 a week to end up with $520 at the end of the challenge.

The No Spend Challenge

Brunching on Sunday? Maybe not if you’re on this plan.

Pick a week or weekend and spend money on only necessities during that time frame. It’ll give you a chance to be creative with your time on limited resources.

Instead of eating out, try a new recipe at home. Instead of grabbing a new pair of shoes, dig deeper into your closet. You set your own time limit, so you can try it until you notice a change in your accounts!

Cash Only for a Month Challenge

A 2024 Forbes Advisor survey found that people tend to spend more with plastic, if given the option. It even stimulates the part of your brain associated with reward, pleasure, and addiction.

A cash diet can help stave overspending. Leave your cards at home when you go out and bring the amount of cash you decide to spend. You can look at the categories in your budget where you tend to overspend, like entertainment or clothes, and set aside cash for those categories. You can only spend the cash allotted for those categories.

Recommended: Does Net Worth Include Home Equity

The 365-Day Nickel-Saving Challenge

If you have a nickel to spare, you can do this challenge. On day one, put a nickel in a jar. On day two, put in 10 cents in the jar. On the third day, add 15 cents. By day 365, you’ll be adding $18.40 — to a total of $3,339.75 in your savings. You won’t have to put away more than $20 in a day and $130 in a week for the entire challenge.

30-Day Budget Preparedness Challenge

It helps to have a map for where you’re going. The same is true with spending.

Challenge yourself to a budget. First, download a budget planner like a spreadsheet template or a budget planner app. Then, go through each category and add the amount you’d like to or must spend in each (such as housing, groceries, entertainment, etc).

Knowing how much to spend before you go out can help improve your planning and control your spending. For example, if you allocate $400 a month to groceries, you can plan it by spending $100 a week. If you don’t spend it all, you can put it in savings.

Money-Saving Challenge Potential Savings

Taking on one of these challenges can help you boost your savings anywhere from $1,000 to $10,000.

But goal-setting will help you determine how much you want to save. If it’s $20,000 in two years, try the bi-weekly savings challenge. If you want to have $1,000 in your account, shoot for the 52-Week Savings Challenge. It’s a fun, concrete way to start.

If spending less is your goal, a challenge can help you cut bad habits like overspending. Setting up a budget and spending cash (not plastic) can help. Some challenges can help function as a monitor if paying off debt is your goal.

Whatever your goal is, these challenges are practical journeys that can pay off.

The Takeaway

A money-saving challenge can be a fun way to build a savings account. It can motivate you to spend less and save more. It can be a concrete demonstration of how small change can add up.

One of the more popular ones is the biweekly money-saving challenge. You can put away an amount you can afford, like $4, and increase it by $4 each week. Or you can set a goal of $5,000 and aim to set aside about $193 each week. It’s an easy plan that can adapt to many situations.

Best of all, you come away with stronger budgeting skills, like saving and prioritizing debt payoffs. These skills could help you make more fiscally responsible decisions. That way, when life happens, you’ll be better prepared.

Take control of your finances with SoFi. With our financial insights and credit score monitoring tools, you can view all of your accounts in one convenient dashboard. From there, you can see your various balances, spending breakdowns, and credit score. Plus you can easily set up budgets and discover valuable financial insights — all at no cost.

FAQ

What is the 100 envelope challenge?

This is a popular 100-day challenge. Number 100 envelopes 1-100. For each day, add the amount of cash to the envelope’s number listed on it. For example, add $1 to the envelope labeled 1, $5 to the envelope labeled $5, and so forth. By the end of the challenge, you’ll end up with $5,050.

What is the most popular money-saving challenge in 2024?

There is no top biller for popular money-saving challenges, but the 52-Week Savings challenge is mentioned across many results in a Google search.

How much money do you save with the 52-week challenge?

If you follow the original plan of starting with $1 on week one, then $2 on week two, $3 on week three, and so forth, you’ll end up with $1,378. Other variations involve changing the starting amount. For instance, you can start with $5 on week one, $10 on week two, until you have $6,890 put away.

Photo credit: iStock/Rawpixel

SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.

*Terms and conditions apply. This offer is only available to new SoFi users without existing SoFi accounts. It is non-transferable. One offer per person. To receive the rewards points offer, you must successfully complete setting up Credit Score Monitoring. Rewards points may only be redeemed towards active SoFi accounts, such as your SoFi Checking or Savings account, subject to program terms that may be found here: SoFi Member Rewards Terms and Conditions. SoFi reserves the right to modify or discontinue this offer at any time without notice.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

SORL-Q224-1911157-V1

At some point, there may come a time when you need to ask the question: Does filing for unemployment benefits affect your credit score? The answer is no, fortunately.

Losing your job can be like a kick in the stomach. It can deflate you and leave you scrambling to figure out what to do next. That last thing that many people need, in addition to firing up a job search, is a hit to their credit score, too. If you do lose your job, many financial professionals will tell you that the first thing you should do, if you qualify, is to file for unemployment so that you still have some income as you revise your resume and start interviewing.

The good news, again, is that you don’t need to worry about a potential ding to your credit. More information below!

Why Your Credit Score Matters

Your credit score is, in a sense, your financial reputation. It can give lenders or creditors a quick and easy summary of your creditworthiness — or, how likely it is you are to pay back a loan on time and in full. Everyone has a credit report, and you can think of your credit score as a truncated version, or sort of like a CliffsNotes, to your credit score.

Your credit score matters because it’s used by lenders to gauge how risky you are as a borrower. It’s used to measure not only whether a lender would be willing to give you a loan, but how much they’d charge you for the privilege — or what the effective interest rate would be for borrowing.

When it comes to some of life’s bigger purchases, such as a car or a home, that can be very important. A couple of percentage points can mean that a borrower ends up paying tens or even hundreds of thousands of dollars more in interest over the years. As such, when a lender sizes up your credit application and takes a look at your credit score, the higher, the better.

As for what factors affect your credit score? It’s a mixture of things: Your payment history, total debt balances, credit utilization, credit history (how long you’ve had accounts), credit mix, and inquiries from lenders.

Recommended: Should I Sell My House Now or Wait?

Unemployment Won’t Appear on Your Credit Report

Again, you may be concerned that if you lose your job, filing for unemployment may affect your credit score. And, again, there’s no cause for concern. Not only will filing for unemployment not affect your credit score, it also won’t appear on your credit report. Your credit report contains information relating to your past borrowing activity, not your employment status.

So, unless there’s been a change in your credit history — say, you apply for a new line of credit or close an old credit card — your credit report won’t change. That said, your credit report may contain information relating to past employers, but the only thing that should have an effect on your credit score will be items relating to financial accounts.

That may become an issue if, say, you were issued a company credit card at a previous job. But for most people, your employment status, or past employers, aren’t likely to have an impact on your credit report or credit score.

Remember: Your credit score is a snapshot of your financial reputation, not your employment status!

How Unemployment Can Affect Credit Scores Indirectly

With all of that in mind, your employment status — or filing for unemployment — may have an effect on your credit score in an indirect way.

As mentioned, your employment status isn’t a part of your credit score’s calculation, and neither is whether or not you received unemployment assistance. It’s really all about paying back or down your debts, on time, and on schedule. As such, if you do lose your job and file for unemployment, you may find yourself in an income crunch. Your unemployment check is most likely going to be smaller than the paycheck you’re accustomed to receiving, and that may make it difficult to keep up with your payments.

You may also be tempted to start using your lines of credit more while unemployed as a way of making ends meet. For example, you might start using your credit card at the grocery store as a way of keeping money in your bank account, with the thought that you’ll pay off your balance once you get another job and a regular paycheck again. Some individuals may also look into personal loans for unemployed persons, too.

That logic may not be faulty, but doing so, you will increase your credit utilization and overall debt, which can lower your credit score.

Finally, if you find that you can’t keep up with your minimum payments due to the resulting cash crunch of losing your job, that, too, will ding your credit score. That’s why it’s important to maintain a line of communication with lenders. If you can’t make your payment, let them know, and they may be willing to work with you. Tools like a money tracker app may be helpful as well.

And, remember, if you do have a company credit card or some other type of financial account with an employer, and you lose your job, that credit line could be severed. That, too, could affect your credit score, as it ultimately lowers your total available credit.

Recommended: What Is The Difference Between Transunion and Equifax?

How to Protect Your Credit Score When Unemployed

As for protecting your credit score while unemployed, the most important things you can do are to try and keep your debt balances low and to keep an open line of communication with your creditors. Of course, a loss in income will probably spur you to change your spending habits by cutting back in certain areas. But in terms of maintaining your credit score, the best course of action is to keep doing what you’re doing: making your payments.

That means continuing to make your payments (at least the minimum) as scheduled. And, since it bears repeating, if you’re going to struggle to make those minimum payments, call your lender and let them know. Some will be willing to make accommodations (forbearance, extensions, etc), perhaps by deferring payments, although there’s no guarantee.

If you feel that you need more help, you can also work with a credit counselor to help you evaluate your options, and even negotiate with your lenders. You may also want to set up free credit monitoring, too, so that you can see any changes to your score.

The Takeaway

If you lose your job and file for unemployment, there shouldn’t be a direct effect on your credit score. That said, there may be indirect factors that could lower your score. The most important thing you can do to maintain a strong credit score is to keep making your payments and try to keep your debt balances (or credit utilization) to a reasonable level.

And remember that if you’re really struggling, it may be worth it to reach out to a professional for personalized advice.

Take control of your finances with SoFi. With our financial insights and credit score monitoring tools, you can view all of your accounts in one convenient dashboard. From there, you can see your various balances, spending breakdowns, and credit score. Plus you can easily set up budgets and discover valuable financial insights — all at no cost.

FAQ

Can I apply for a credit card when I’m unemployed?

It’s possible to get a credit card while unemployed, but keep in mind that a creditor’s main concern is whether or not you can make your payments. As such, your approval for a credit card may hinge on your income and other debts or financial obligations.

What if my credit score goes down?

Credit scores go up and down all the time, but if you do experience a fall in your credit score while unemployed, you’ll likely know why — and it’s probably because you missed payments or saw your credit utilization go up. The good news is that you can always work on increasing it again.

What personal information does your credit report include?

The short answer? A lot of it. That includes your name, aliases, birth date, Social Security number, address (and former addresses), phone number, and possibly your employment history, among other things.

Photo credit: iStock/sorrapong

SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.

*Terms and conditions apply. This offer is only available to new SoFi users without existing SoFi accounts. It is non-transferable. One offer per person. To receive the rewards points offer, you must successfully complete setting up Credit Score Monitoring. Rewards points may only be redeemed towards active SoFi accounts, such as your SoFi Checking or Savings account, subject to program terms that may be found here: SoFi Member Rewards Terms and Conditions. SoFi reserves the right to modify or discontinue this offer at any time without notice.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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