A while ago I started a tiny blog to talk about my programming projects. That blog turned into a reasonably sized website related to video games in general, and it makes money from advertising.
Several times, I considered stopping my work on that site. I loved spending time on it, but it represents an average of 15h of work a week, and my wife in particular did not appreciate that I’d spend more time with my blog than my kids. At the end of the day, it was a hobby so I didn’t count the hours spent on it, but these hours where taking time away from me and my family.
So when I crunched the numbers, several times I felt this wasn’t worth it. I made much less money per hour with this blog, than the money I made at my daytime job. Overall, the blog represented 10% of my income, while being 25% of my time.
Of course, looking at this only from this angle makes it sound terrible. But one has to keep in mind that this was my hobby, so in essence I was still getting paid to do something I enjoy. Most people actually pay for their hobby, not the other way around. That alone was a good reason to keep going.
But, maybe more importantly, I never took that money for granted. We didn’t need it to make a living, and I was making sure this money was not required for everyday life. And I think this makes sense for side money like this, as it could stop coming any time. As a result, that money was 100% available for savings (well, minus taxes of course).
The logic does not stop here though. If I kept thinking about that money in terms of percentage of my total income, it didn’t represent a large share (10% of my income). But in terms of savings, it represented a lot more. I was typically able to save about 25% of my total income. The side project just added a good lump to that, bumping my saving rate to about 32%. All of a sudden, my side hobby represented much more than “10% of my income”. It represented almost 25% of my savings!
Taken from this perspective, any amount of side money is good, in particular if the share you can save on your regular salary is fairly low. The trick is to not take that money for granted, and not rely on it for day to day life.
Finally, the profits from that website have (literally) been multiplied by 10 within 5 years. Things are slowing down lately and I will probably not see similar numbers for the following 5 years, but this is a good anecdotal data point for those of you who are thinking on giving up their side projects.