FOOL'S EYE VIEW
Moonlight Your Way To Greater Wealth

By David Kuo (TMFDragon)
March 21, 2002

Teachers do it. Footballers do it. And even some halfway-educated members of parliament do it. But should we do it? And what exactly are we talking about?

Why it's moonlighting of course or the holding of a second job in addition to your regular one. It's not illegal to moonlight (although you may be barred from doing it in your contract of employment) but there are some important issues to consider before you launch headlong into that second job. But firstly let's take a look at some of the reasons why people moonlight.

Contrary to popular belief it is not always the thought of more money that is the main motivator. Though more dosh in your pocket can be quite an attractive proposition. However, it is fair to say that at its most basic level moonlighting can be a direct result of economic constraints within your primary work place. These constraints could limit the number of hours that you can effectively work. And this could prevent you from working and earning as much as you would like. So taking on that second job could be a logical option.

Another reason for moonlighting could be the opportunities that arise from your primary employment. Teachers, for example, often take on tutoring duties outside of their normal working hours and it is not unusual for university lecturers to be engaged as consultants. Footballers quite often appear on radio and television as pundits though they can also talk a lot of nonsense sometimes. And of course members of parliament often find their way into corporate boardrooms by virtue of the influence they have as politicians.

And lastly, some of us may look to moonlighting as a means of making money from our individual pursuits, hobbies or talents. We are all blessed with gifts and talents that may be either underutilised or perhaps not used at all in our primary work place. For instance, many of those musicians that you find tinkling on the ivories in bars and restaurants at night might well have regular day jobs. However the chance to show off their talents by entertaining folks can be payment in itself even though the money might not be that great.

But the decision as to whether or not to start that second job should not be taken lightly. It is a strategic option, which should be evaluated along the same lines that say any business would undertake before treading down a new path. The evaluation criteria fall into three main categories.

1. Is it suitable?

What we are asking here is whether that second job will utilise some of your many hidden strengths. Take a good look at what you enjoy doing in your spare time because this is always a good place to start. You could for instance be quite an accomplished amateur photographer or perhaps a video camera enthusiast. Those talents would lend itself quite readily to work as a part-time photographer. And once you get that video camera rolling you don't have to stop at weddings, birthdays and barmitzvas.

2. Is it feasible?

If you intend to make money out of your moonlighting escapade then you need to consider carefully the financial aspects of that decision. If it is going to be a mini-cottage industry then you will need to take into account the capital required to kick-start that project. Furthermore simple cash flow plans and basic budgeting outlines will tell you whether the project has legs or whether it is likely to fall at the first hurdle. If on the other hand, you are simply going to sell your services to other businesses, then you will have to take into account the various tax implications. Remember you can't just pocket the money because the taxman will jump on you from a great height if you try. Our Motley Fool Tax Return Survival Workbook, which is due out in the spring, should help guide you through the various pitfalls when filling in your tax return.

3. Is it acceptable?

This is the trickiest of the three criteria to assess. This is because the issues relate to your interaction with other people. After you have decided that you have the wherewithal to embark on that second job and determined whether it will be financially lucrative then you need to convince other people. These other parties will include your existing employer who might be thrilled to bits that you have a life outside of work. Your boss might even be able to find ways of harnessing your talents, which could benefit you and the company simultaneously. But then on the other hand he might just fire you on the spot especially if he thinks your second job could have a conflict of interest with you primary employment. You should also discuss your new venture with your family because a second job will mean less time spent with the family.

So there is it is in a nutshell. A second job will mean sacrifices and you will most likely have to forego some of your leisure activities. You will have to decide if the benefits of that second job are worth the sacrifices.