Holidays, summer camps, days out with friends and family and as many BBQs as the weather will allow… Summer can be an expensive time for all of us, and by the end of the season your wallet can be feeling the pinch.
However, as Managing Director of Rockwell Financial, Robert Whelan, says, a summer side hustle can take the sting out of the high costs. He joined the Brendan O’Connor show to share his tips for managing debt this summer.
First he suggests “triaging” our debts, especially with credit cards. Rather than staying a cycle of clearing just the minimum payments, Whelan says that clearing the debt entirely before addressing any others can be worthwhile as credit cards are the most expensive debts.
“The principle behind triaging is being aware of it yourself”, he says. “If you write down the amount and the interest rate beside it, it’ll be very clear as to which one you should be clearing.”
From there, he suggests addressing personal loans and mortgages.
To add income, side hustles have become popular at least online, with creators sharing their hustle ideas on TikTok and Instagram. While they can be beneficial, Whelan cautions that “first and foremost, don’t forget that the primary driver of your capacity to pay down your debt is your day job”.
“If you take on a side hustle job and for whatever reason it impacts on the day job, well then that’s not really a side hustle. You’re just creating another problem.”
If a side hustle does suit your circumstances, some options are worth exploring. The Rent a Room Scheme can be useful if you have a spare room for a lodger, as that income is tax-free and having company around the house can be enjoyable in itself.
Dog- and cat-sitting is another option, with stints ranging from a few days to weeks or even months. It can be a way of seeing more of the world while making a bit of money, and getting to spending time with sweet pets.
House-swapping is another “incredibly cost-effective way to have a really nice family holiday”, Whelan says, as there is no cash being exchanged. If you want to rent your own home out while you’re away, Whelan notes that it is taxable income.
Of course, ensuring that you are on top of your tax returns is especially important with side hustles, so consult Revenue for more information.
Finally, for another bump to your budget, Whelan points to tax benefits that most people are not taking advantage of.
Medical expenses is a big one, he says, from GP check-ins to physio and consultant visits. With the Drug Payments Scheme in particular, Whelan says that the first €120 on certain medications for yourself through Revenue. “Not all drugs are part of the Drug Payments Scheme”, he says.
For more tips on managing debt this summer, listen to the interview above.