Ever since college, I’ve done physics tutoring as a side hustle — a way to make a little extra cash here and there. But in 2016, after returning from a travel sabbatical in Hawaii, I found myself jobless, and I decided to try turning my side gig into a full-time business.

I made thousands of business cards with my credentials and phone number, and I just stood outside of university lecture halls, handing them out as quickly as possible every time an auditorium full of physics students was dismissed. My rate was printed right on the cards: $35 per hour.

Photos of Steven's tutoring business cards
My first tutoring business card.

Within just a couple of weeks, I had a full roster of students and a nearly 40-hour work week booked for the rest of the semester. I felt pretty proud. But I also felt like I had missed an opportunity.

If I was able to fill up all of my available time so quickly at $35/hour, what would have happened if I charged $40/hour instead? Was I leaving money on the table? So I raised my rates for all new clients, and the answer turned out to be “yes.” My calendar stayed full! And then I raised my rates again…

By the time I started to work with my very first clients at $50/hour or more, an established local tutoring company called me out of the blue and offered me a full-time job. At first, I wasn’t really interested, but I took the interview anyway, and to my surprise, they were willing to make a very competitive offer. So I accepted the stable paycheck and mostly just forgot about my private tutoring business.

For the next few years, Lauren and I had record low living expenses (in part because of our paid-off house), combined with shiny new jobs. We increased our net worth faster than ever, and just a few years later, we were financially secure enough to quit full-time work indefinitely at the age of 29.

But every once in a while, a random student will still ask me for a private tutoring session. Because I have no need to fill my calendar with clients any more, the price I quote is $90+/hour*. I get much less business now because of my high price (and lack of marketing), but I also don’t really need the income in the first place.

I do very little private tutoring at this point, but when I do, I’m paid really well! This is the magic of part-time work: when you eliminate the need to sell all of your available time, you can be much more choosy about what price you sell it for. And you can keep the rest of your time for yourself and the people you care about most.

Doing the Math: Part-Time vs. Full-Time Work

Imagine Mindy, a full-time women’s hair stylist. She’s exceptionally good at her job, and she has a full load of happy customers who pay her $40 per haircut. She does 40 cuts a week, 50 weeks a year, giving her a gross revenue of $80,000 per year, before paying her expenses and taxes.

Mindy has always charged $40 for a women’s haircut, but unbeknownst to her, she is so good at her job that half of her clients would actually be willing to pay more than the $40 if they had to.

Graphic of part-time client pool
Half of Mindy’s clients are secretly willing to pay more than she’s currently charging.

She has no way of knowing this without actually raising her price experimentally, but if Mindy charged $60 instead of $40, she would still retain half of her current clients. Doing so would cause her total revenue to drop by 25% to $60,000 per year, but her hours spent at work would drop by half — she would be getting paid much more per hour of her time.

There’s one obvious problem with this strategy though: Mindy still needs to make $80,000/yr in revenue to pay her bills! So she forgets this whole idea and keeps plugging away at her full-time job forever.

Low Living Expenses: Where the Magic Happens

Now imagine that our hypothetical hairdresser picked up a roommate or two, traded in her two-year-old financed SUV for a cheap car paid in cash and a nice used bike, and started getting all her food from Costco and Walmart rather than restaurants and grocery stores. Suppose she also killed a couple of unnecessary insurance bills and other recurring costs like TV subscriptions.

With a few more tweaks, she’s now able to live on under $30k a year — maybe even less! And that part-time lifestyle doesn’t seem so impossible any more. If she wanted to, she could live pretty comfortably on 20 hours of work per week indefinitely, and still have money left over. That’s pretty amazing.

Alternatively, she could keep working full-time for a while and shovel the obscene amount of excess income into investments. If she could manage to save and invest 65% of her take-home pay, she’d be able to retire from work forever in about 10 years.

Without a need for income at all, she could do things like travel whenever she pleased, or pursue passion projects regardless of their potential for pay. And if she still wanted to cut hair on the side once in a while, she could retain only her highest-paying customers so that it was always well worth her time.

The magic of part-time work isn’t often tapped into because it requires somewhat uncommon spending habits to be viable. But once your spending is under control, a part-time lifestyle may start to seem pretty appealing to you.

Throughout our 20s, Lauren and I had somewhere between $18k – $26k per year in combined living expenses (with the exception of one very expensive trip). Even at our earliest full-time jobs (which paid under $39k/year each), we always made a lot more money than we needed, creating a huge budget surplus. All that excess income just got piled into investment accounts.

Photo of Lauren working on her laptop
Lauren doing a little remote work at a Target near St. Louis, Missouri.

Now we work somewhere between 0 and 10 hours per week each, doing mostly remote freelance gigs that pay a much higher hourly rate than we used to make at our full-time jobs. This setup allows us to travel as we please, keep from touching our nest egg, and avoid worrying about money. As mostly-retired part-timers, our expenses are slightly higher than they used to be, because we have to buy private health insurance without employers to provide it — but they’re still very manageable.

Using Part-Time Work as Overtime

If you’re young and full of energy — eager to fill up your brokerage account as quickly as you possibly can — then leisurely part-time work might not sound very appealing. Why scale back when you can make more by hustling hard?

Great idea! But a part-time side gig can still help. Keep your full-time job, and then set the price for your side services super high, maximizing the profit you make in your spare time.

One side gig we’ve had since high school has been photography. With day jobs, we never had time to do a whole lot of it, but whenever the opportunity arose to shoot a multi-thousand-dollar wedding, we always jumped on it no matter what.

Photo of Steven with his camera
Shooting a weekend wedding getaway in North Carolina.

Alternatively, if you have a lot of different specialized skills, you may be able to cobble together several side gigs to replace your full-time job altogether. This allows you to benefit from the part-time “premium pricing” model in each one of them, without losing out on a full-time work schedule.

Negotiating Part-Time Work with Your Employer

All this talk of flexible hours and adjusting your pricing might sound kinda unrelatable if you’ve only ever had a regular, 9-5 job as an employee — especially at a big company with rigid rules. It’s true that there are some jobs which just can’t be done part-time. But you might be surprised what’s possible if you work up the courage to test the waters.

Let’s say you’ve been working your traditional, 40-hour-a-week desk job for 5 years. And suppose that you’re also a great employee that the company would really like to retain.

If you walk into your boss’s office and simply ask to work half as many hours for 75% of your current pay, there’s a chance they might laugh in your face. They might even tell you that they wouldn’t even consider half-time work for 50% pay.

But sometimes, that’s just because your boss knows that they hold all the cards. Most employees can’t go without a paycheck.

Imagine instead that you had over $100,000 in investments, and zero debt to your name. And because you only spend $30k per year, $100k represents over three full years of living expenses. You’re far from retired, but you don’t particularly need a job at all in the short term. You’ve got a bit of “FU money” (the more the better, but several years’ living expenses is a good place to start).

If you were getting tired of working full-time, you could walk into your boss’s office with confidence and simply say, “I am no longer interested in working full-time, but I still really like this company and would rather not leave. Here are my proposals — one of which is that I simply quit and find a more flexible job elsewhere.”

In this situation, you have leverage when negotiating part-time work with your employer: They either accept your part-time proposal, or they lose you as an employee. Depending on how aggressive you want to be, you can even negotiate retaining the most important 50% of the work (your personal specialty) in exchange for more than 50% of your current pay. It sounds crazy, but I have seen this strategy succeed first-hand more than once (for both Lauren, myself, and a friend or two).

Any job negotiation comes with risk. And so does a price hike in a hair-cutting or tutoring business. You never know what the outcome might be. So it’s important to only employ strategies like this when you have the means to accept the worst-case results. If you do, then taking the risk might pay off big!

I’m not trying to tell you what to do, or even that my specific ideas will apply perfectly to your situation. The main point here is that there are tons of options between “work full-time” and “retire forever.” If you have the courage to tap into those possibilities, you may be able to design a freer, happier life that works within your circumstances.

— Steven

* Update, October 2022: At this point, even $90/hr feels unexciting to me, so I’ve moved away from doing much one-on-one tutoring at all. Lately, the only small amount of tutoring I still do is on video for an established company (my old employer), who then charges thousands of students for access to those videos. Their business model is more scalable, and as a result, it allows me to get paid much more than $90 per hour for my part-time side hustle! But it’s always nice to know that I could fall back on individual tutoring if I ever wanted to.

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