Earn More or Save More? Why I Think Income Deserves More Attention

Earn more or save more? It is a question I keep coming back to, because the cost of living crisis is really starting to annoy me.

I don’t want to be the negative one, but someone has to say it. Most of us are cutting back and saving where we can. Then a company puts its prices up, and the money we saved goes straight to them.

Look at the last few weeks. Ofgem has raised the energy price cap by 4% from 1 October. Netflix has put its UK prices up. People are already talking about energy going up again in January.

So what is the point of trying so hard to save? There is always a point. But I think we need to talk a lot more about the other side of the sum, and that is earning more.

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Why saving feels like a losing battle in the cost of living crisis

Start with energy. From 1 October to 31 December 2026, Ofgem says a typical household paying by Direct Debit moves from £1,663 to £1,723 a year, if that level lasted for twelve months. That is £60 a year, or £5 a month. The government has also removed VAT from domestic electricity until 31 March 2027, so electricity bills are lower than they would be otherwise.

Now Netflix. New customers pay the new prices straight away, and existing members get a month’s notice by email. The plan with adverts has gone from £5.99 to £7.99 a month. The ad-free Standard plan has gone from £12.99 to £13.99.

Add those together. If you are on the plan with adverts and use a typical amount of energy, those two rises cost you about £84 more a year. That is before food, fuel or anything else.

What about January? I can’t tell you, and any number you see now is a forecast. Ofgem announces the cap for January to March 2027 on 25 November 2026. You can see the dates on Ofgem’s page for this cap period.

You can still protect yourself. The cap does not change your rate while you are on a fixed tariff, and Ofgem says fixed deals are available at £100 or more below the October cap. It costs nothing to compare. If you switch, Octopus Energy has a £50 off offer through my link. Check the terms on their page first.

For your other bills, a bill-saving app like Nous can check whether you are on the best deal. I also cover this in my guide to saving money on bills.

There is a ceiling to saving, but not to earning

Saving has a floor. You can only cut back so far. Rent, food and energy never drop to zero. Once you have switched tariffs, trimmed subscriptions and shopped around, the next saving is smaller than the last one. Then a price rise arrives and takes some of it back.

Earning works differently. There is no built-in cap on what a side hustle can pay. You can fit it in where you can, and you can grow it as far as your time allows.

That last part matters. Time is the real limit. Crunch’s guide to UK side hustles says most side hustles need a lot of time and energy before they pay off, even the ones sold as passive income. So pick something that fits your life.

I have side hustled for over a decade, and it has changed my life. I have always been an “earn extra” kind of person. I will always be savvy and save where I can, but I think the focus should shift towards earning more. Extra income can change your circumstances, whether that means paying off debt, still going on holiday or affording a meal out.

Is it better to earn more or save more?

For most people, the honest answer is both. Right now, though, I think earning deserves more attention.

Here is why. Take the £84 from above. That is £7 a month. You could earn £7 a month more and cover both rises. Finding another £7 a month to cut from bills you have already trimmed may be much harder.

Even £20 here and there can cover a phone bill or go towards a debt payment. It will not fix every price rise. It does give you a second option that does not rely on cutting back a bit further.

How to earn extra money without big start-up costs

You don’t need to start a business, and you don’t need to spend money first. Start with one small thing.

The easiest place to begin is with what you already own. If you have things you no longer use, selling them costs nothing to try. I have shared my tips for selling on Vinted.

If you like making videos, you can make money from content with zero followers. That is what UGC is about.

You can also get involved in market research. Respondent and User Interviews are market research platforms. You can sign up and see whether any studies suit you.

I have more side hustle content coming, and I think it will change how you use side hustles to earn more. In the meantime, you can browse more ways to make money on the site.

Side hustle tax UK: what to check before you start

Extra income can mean tax, so check the rules first.

Most people can earn £1,000 from side hustles in a tax year before they need to tell HMRC. This is the trading allowance. You get one allowance in total, not one per side hustle, and it counts your income before costs.

If you earn more than £1,000 in total, you need to tell HMRC. At the moment, that is usually done through Self Assessment. If you have never sent a return, you must tell HMRC after the tax year ends. You may only owe tax if your total income, including your main job, is above the £12,570 personal allowance.

If you sell 30 items and make under £1,000 in total, HMRC says you do not pay tax on it. Online platforms must now share information with HMRC if you sell 30 or more items a year.

You may have seen news about a £3,000 limit. The government plans a new online service, due by 2029, for people who earn between £1,000 and £3,000. It will replace a full Self Assessment return for that group. The £1,000 tax-free allowance is not changing, and the new service is not live yet. The GOV.UK guidance on trading allowances has the current rules.

This is general information, not personal tax advice. Check your own situation on GOV.UK.

Saving and earning work best together

I am not saying stop saving. Keep comparing, keep switching, keep trimming. But when the next price rise lands, I want you to have another option that does not mean cutting back a little further.

If you earn something extra, put it towards the bill that went up. That way, the rise stops costing you from your own pocket. You can find more ideas in my Save Money section.

So which are you: someone who saves more, or someone who earns more? Tell me in the comments. And if you want to hear about my side hustle content as it lands, join The Savvy Spender newsletter.