Side gigs are all the rage these days, with professionals of all generations considering the benefits of picking up side work for some extra cash. For a fresh college graduate, a side hustle could provide the extra income necessary to start saving for a down payment on a home. For a retiree, a side gig is the perfect way to supplement your income while keeping you active in an area that interests you.

The prevalence and availability of side gigs is all thanks to the gig economy, a trend encouraging more businesses to hire independent contractors and more individuals to start new ventures. While the gig economy has some major pros and cons for the economy at large, let's look at how it impacts the individual participating in it; in other words, are side gigs really the best way to earn more income?

The Nature of the Side Gig

First, we need to address the fact that not all side gigs are created equal. Some are capable of making you far more money than others, and some require a much more significant investment of time. For example, driving for a ridesharing service like Uber or Lyft can earn you a decent amount of money--but after you account for expenses and the cut taken by the parent company, the average pay per hour is somewhere between $8.55 and $11.77, which you might be able to beat working at a fast food restaurant.

By contrast, other side gigs are lucrative, and require far fewer expenses. For example, if you learn to program, you could get by with minimal equipment and overhead and make a national average of $31 per hour. Of course, to get this rate, you'll need to invest more time and energy, learning and practicing the skills necessary to create software or code websites. There are plenty of free resources on the web you can use to learn these skills, but it still takes at least several months, if not a year or longer, to develop enough to get paid for your work.

If you're willing to try a gig that's a little less conventional, you could donate an egg to a couple in need and make $8,000 or more. Again, there's a tradeoff to the extra money you'll make. You'll need to apply, get a medical screening, and get matched with a prospective couple (which is not guaranteed), and then go through IVF, pregnancy, and delivery.

Obviously, it's possible to make lots of money with a side gig (or make very little), but the level of compensation isn't the only factor you have to consider when evaluating the opportunities that side gigs provide.

The Time Factor

One of the biggest advantages of a side gig is that it typically comes with scheduling flexibility. You won't have to quit your job or drop out of school to pick up a side gig. You can usually set your own hours (or at least set your own availability). You can work as little or as much as you'd like. This flexibility is something you won't find in a typical part-time or full-time job, and it's perfect for people with busy lifestyles, or those pursuing other primary goals.

The Risk Factor

There also isn't much of a risk in picking up a side gig, since you won't have to make a major initial investment. If you try walking dogs for some extra cash but you don't like it or can't sustain the work, you can always quit without burning bridges. You also don't have to go through the process of starting a full-fledged business (unless, of course, you want to).

The Personal Interest Factor

Side gigs are also appealing because they oftentimes don't feel like work. People pursue them because they align with their personal interests, or give them a chance to engage with their favorite hobby; for example, you might try to sell your woodburning art or play gigs as a one-man-band. In this context, side gigs are the "best" way to make money not because of how much money they return, but because the money is simply an added perk of doing what you'd be doing otherwise.

Alternative Forms of Income Generation

Already, it's clear that side gigs have some enormous advantages, but let's take a look at how they compare to other forms of making more money:

  • Raises, bonuses, and promotions. This is arguably the best way to make more money, since it has the potential to return more income while demanding little to no extra work. Asking for a raise or a more important job title can instantly boost your earnings.
  • Investments. The average annual return of the S&P 500 is somewhere around 10 percent, based on historical data. If you have the capital to invest, a combination of asset growth and dividends could provide you a substantial (and passive) return. The same is true for investments like rental properties. The downsides, of course, are that you need money to start and you'll usually face significant risks in the process.
  • Major career changes. Your other option is to try and pursue some other full-time career, which usually takes a massive investment of time and money, or a huge personal risk. For example, you could learn a new trade or try and start your own business.

The Bottom Line

Side gigs are too diverse too make a definitive conclusion about them overall; some side gigs are lucrative opportunities that could rival your full-time salary even with part-time work. Some side gigs will cost you more money than they'll make you. But that diversity is what also makes them so perfect. Chances are, there's a side gig you genuinely love doing. There's one that perfectly fits into your schedule. There's one that has just the right balance of risk and reward. Because of this, side gigs truly are the best way to earn more income for millions of people.