Side Hustles vs. Overtime: Which Pays Off Faster for Young Workers?
If you are a young worker in this economy, you are likely trying to maximize your income in the amount of time you have available. So which is the better strategy: get a side gig outside of your 9-to-5 or try to tap into overtime at your current place of employment?
MoneyLion got in touch with Kathy Kristof, the founder and CEO of SideHusl.com, and Cody Schuiteboer, the president and CEO of Best Interest Financial, to break it down and find out.
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Work With What You Have
In Schuiteboer’s professional view, overtime is significantly better than a side hustle, which is assuming standard federal overtime rules for the Fair Labor Standards Act are followed, requiring employers to pay 1.5 times the normal rate for every hour worked past 40 per week.
“A young worker who does a side hustle in 2026 — whether driving a rideshare, providing services through Upwork or Fiverr, delivering packages, or completing other gig jobs, will make between $15/hour and $22/hour, depending on overhead costs,” Schuiteboer said. “Simply put, overtime is 70-150% more efficient than a side hustle, per hour. The worker taking 10 hours of overtime per week at that pace would earn $375 compared to $150-$220 on the same amount of gig work.”
Limits of Overtime
According to Kristof, most companies offer only a limited amount of overtime to their employees.
“Thus, if you're highly ambitious, you might want to find a side gig that allows you to work whenever you have free time,” Kristof said.
You also have more options with side gigs, as you can sometimes choose your own rates.
“Also, many side gigs allow you to price your own services,” Kristof said. “So, where your company determines what you earn with overtime, you can determine what you earn with a side gig.”
Consider the Taxes
Schuiteboer highlighted that overtime is considered W-2 compensation, and “thus is taxed fully at the usual federal income tax rates, including the FICA tax of 7.65%, state income taxes, and full reporting requirements through your employer.”
A side hustle, Schuiteboer went on to point out, is considered self-employment income for tax purposes, and it thus is subject to a much bigger tax bite.
“Since self-employment income includes the full amount earned from services rendered, it gets hit twice for every dollar, with 15.3% in self-employment tax paid by the side-hustle worker before income tax enters the equation,” Schuiteboer said.
Do the Math
How much can you actually earn with a side hustle? In Kristof’s professional opinion, that all depends on the gig and your skills.
“Some armchair consulting gigs pay more than $100 an hour,” Kristof said. “Meanwhile, simple, low-maintenance gigs like dog sitting can pay $50 - $100 a night. I've talked to people earning $1,000 a month with Rover working very part-time and others who have turned it into a full-time job, earning mid 5-figure incomes. ($60-$70k).”
Ultimately, both side gigs and overtime offer benefits for workers to consider. As Schuiteboer noted, overtime can pay a lot better and is easier, while side hustles can grow over time and generate additional sources of income.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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