How to Become an Online Tutor: Side Hustle Idea

Jake - Wealthy Corner Author/Founder

Jake - Wealthy Corner Author/Founder

Hi, I'm Jake. I help people under 40 reduce money stress and grow wealth.

Increase and diversify income with online tutoring. Read to learn about online tutoring platforms, pay, the application process, tutoring tips, and more.

Intro

We saw the importance of income diversity during the lockdowns as unemployment soared. A side hustle can help you boost income and diversify income streams, where you can expect to earn $25 USD/hour. 

You can use this extra money to pay down debt or save for a vacation, home or wedding. Ideally, you can put those extra dollars to work immediately by investing for long-term compounded growth to accelerate your path to financial freedom.

Table of Contents

Online Tutoring Platforms

There are many online tutoring platforms, however I’ll keep things limited to the two platforms that i’m personally familiar with: Skooli and Preply. This isn’t a review article, but you will get a sense of how the two platforms work as you read this post.

The main differences between Skooli and Preply are that Skooli uses a flat-rate pay system at $25 USD/hour whereas Preply uses a commission-based system where you set your own rate. 

How do I know about these platforms? I’ve tutored on Skooli for eight months, and have gone through the application process with Preply. I decided not to work with Preply for reasons you’ll see below. 

What you learn in this article will be applicable to various online tutoring platforms as well; they are all very similar.

How to Apply as an Online Tutor

Both Skooli and Preply have a similar application process. You generate a tutor profile, select subjects to teach, upload documents and conduct an interview. All of these steps are straight forward as you are guided through the application process on the website.  

You can start the application process here for Skooli, and here for Preply. Expect to spend four hours of unpaid time for the entire application process.

Make a Profile

The first step is to make a tutor account. Boom, you will now be guided through these steps in the application process:

Select Subject(s). Stay focused on one area of study. You want to specialize in a single area to improve your competence.  For example, do not select math, economics, leadership and English as a Second Language. The spread of subjects is too broad. I’ll talk more about this below. 

Input About Info: This section will be displayed on your profile, so be inviting and sell yourself. Show the student why you are the tutor of choice in their subject area. Feel free to take a look at my profile as an example.

Input your Work Experience. Include your educational experience, work experience applicable to the subject and your reason for tutoring. 

Upload a Photo. Don’t go photo-less! Make sure it is a good, professional photo of yourself. Smile.

Introduction Video

Preply has a hard requirement in the application process to submit an introduction video up to two minutes in length, while Skooli makes a video optional.

Students will see this video, and will use it in their decision to select you as a tutor. Keep it geared towards how you can help them improve their knowledge and skills in your subject domain. A video is a good way to display your personality to break down initial barriers to comfort and trust. 

Upload Digital Documents

You will need to upload digital copies of these documents (for Skooli):

  1. Degree(s);
  2. Teaching license (if you have one);
  3. Proof of a Criminal Record Check; and
  4. Identification – drivers license or passport.

I took pictures of the hard copy documents with my phone, cropped the pictures and uploaded them to the tutoring platform. 

 If your degree is framed, you’ll have to remove it from the case to remove glare. I had the opposite problem as mine has been rolled dup in a box for the past 5 years in my attic.

The Interview

Now comes the big event, the interview. Be ready to answer questions about your subject matter expertise, why you want to be a tutor, and your experience tutoring.

Don’t be surprised if you are asked for a piece of ID during the interview to prove your identity by holding it up beside your face during the video chat. 

What You Need to Become an Online Tutor

Qualifications

For Skooli you need to have one of the following:

  1. Undergraduate degree + teaching certification;
  2. Masters Degree or PhD;
  3. A government issued teaching license or a specialized instructor qualification; and
  4. ESL or other language qualification.

You do not need to be a certified teacher on Preply or Skooli, but it helps. For example, certified teachers get a nice gold apple on their Skooli profile, boosting your credibility. I am not a certified teacher, so I rely on strong student reviews.

Preply does not have any hard requirements to become a tutor. However, you must be competent in your subject area. Otherwise, you will naturally get selected out of the rankings as students give you poor reviews.  

Knowledge, Skills and Passion

You need a genuine desire to help others learn. It is important that you are passionate about learning and the subject you are teaching. Not only will you enjoy it more, but you’ll do a better job. You owe it to the students. 

Familiarity with the Virtual Classroom

The virtual classroom is where the tutoring actually happens. Preply and Skooli both have a virtual classroom that is essentially a video chat session with a whiteboard, a chat area and other tools. 

I do most of my math tutoring on the whiteboard. Here I can draw out graphs and equations. It’s pretty interactive because the student can also draw on the whiteboard and even save the notes to their device.

Learn how to navigate and use the tools in the virtual classroom before you start teaching! Otherwise, you will just look silly and waste the student’s time (and money).

Equipment

Do you have a laptop with a working webcam and a mic? If so, you are equipped to start tutoring. I view a graphic pen tablet as a hard requirement to draw on the whiteboard in the virtual classroom. No student wants to sit in pain while they watch you attempt to draw with your mouse.

Graphic Pen Tablet ($50):  I use the XP-PENStar G640 and it works great. Expect to spend between $30 and $60 for a graphic pen tablet. These are especially important tutoring algebra, geometry and calculus so you can write out the problem and draw graphs with the student over the online platform. Spend the $50 for the graphics tablet. 

A computer with a webcam and a microphone. An external mic or headset is recommended if you tutor often to improve the experience for the student.  

If your reading this, you probably already have a laptop with a webcam and integrated mic. In this case, the only barrier to getting started is the application process and the graphic pen tablet.

Pay Systems and Rate of Pay

There are two main pay systems that you should expect across the various online tutoring platforms: a commission-based system or a flat-rate pay system. Skooli uses a flat rate system while Preply uses a commission-based system.

Flat rate System

With a flat rate system you are paid a flat rate of pay for each hour you spend tutoring.

Skooli for example pays $25 USD per hour flat rate to tutors (subject dependant), which is roughly $30/hr Canadian at the time of writing. This is a flat rate system. You get paid for the time spent tutoring.

Your pay earnings will show up in your Skooli account after teaching. You can then request payout and your money will transfer over to your PayPal account. From paypal you can transfer the balance into your bank account.

Commission-based

Under a commission-based system, the tutoring company will allow you to set your own rate, and you will pay a percentage of your rate (the commission) to the tutoring company.

Preply uses a commission-based system. Take a quick scroll through Preply’s tutors and you can see they charge rates that range from $15/hr to $40/hr.

On Preply, 100% of the amount for the first tutoring session with every new student. You heard it right, the first lesson with each new student is unpaid.

After the first session the commission fees vary from 33% to 18% as you accumulate more hours. This incentivizes you to stick with one student and to accumulate more hours tutoring on the Preply platform.

I don’t use Peply because I only tutor once per week. I would cycle through different students and Preply would take their 100% commission nearly every time I tutored. That sounds terrible for me and great for Preply. It may have worked out if I tutored more often.

Online Tutoring Pros & Cons

Pros

Location Freedom.  Going to the cottage and have some free time? No problem. You can tutor from anywhere with an internet connection. This could be your home, your cottage or even while you are travelling on vacation. All you need is an internet connection and a quiet room free from distraction.

Time Flexibility. You make your own hours. There is no hard requirement to tutor at certain hours, although most students are available in the evenings. Time zones help distribute workload across the entirety of the evening.

Low Start Up Costs. Start-up costs are very low if you already have a laptop with a mic and webcam. All you’ll need is a graphic tablet.  $50 and you are ready to roll.

It is Rewarding.  It is super rewarding to watch a student progress through a lesson. It is even better when you can get things to “click” for a student. Time goes by quick in these sessions and you enter a state of “flow”. This feels good. 

Cons

Tutoring is Non-Scalable.  You directly trade your time for money with online tutoring. Want to double your tutoring income? You need to double your tutoring time. Take note that both the flat rate and commission-based systems are non-scalable. To put this into context, the scalable twin of tutoring would be to build an online course and sell it. The same efforts would apply in building the course if it was sold to 1 person or 10,00 people. Note also that the tutoring platforms like Skooli and Preply are highly scalable businesses. Tutoring is Seasonal.  Although tutoring brings short-term time flexibility, you will have less opportunity to tutor in the summer months when school is out. In addition, tutoring demand tends to peak during the exam periods for high school, college and university.

Why Online Tutoring is Great for Recent Grads

Online tutoring is well suited for those just finishing university, doing a master’s degree or just starting their careers. Here are the benefits of tutoring at an earlier stage in life:

Less Tax. Your income is likely low at this stage in life, so your tutoring income will be taxed at a low marginal rate. Check out this post to learn more about how taxes work for Canadians. Understand Taxes for Investing: A Guide for Canadian Beginners

Available Time.  Time commitments only increase as you get older. Most have the free time to take on tutoring on the side. 

More Time For Compound Growth: At a young age, your investments have more time to undergo compound growth with your investment of choice. I primarily use index funds for simplicity and solid returns; you can read here to learn more about index funds.

Greater Effect on Income: Because income is normally low while young, tutoring will have a huge impact on your total income. Four hours per week of tutoring won’t make much difference if you make $100k per year, but sure will if you make $30k/year.

Taxes For Tutoring Income

You are an independent contractor when working through Preply or Skooi. It is your responsibility to report tutoring income, and to pay taxes on this income. The online tutoring platform will not deduct taxes for you if you are classified as an independent contractor. 

As an independent contractor, you can claim expenses to reduce your total taxable income. For example, you can deduct the graphics tablet expense, the criminal record check and depreciate electronics like your laptop that are used for tutoring. You can even deduct home office expenses. Be sure to check with tax policies in your specific country/region. I am not a tax expert.

You may cringe at having to deal with the tax portion. However, I guarantee you the work you put in to understand tax policy will pay off in the long term, especially if you ever want to start a business. 

The tax policies are pretty much equivalent to being a sole-proprietor. Plus, familiarity with general tax policy is critical to building wealth.  

Tips to Become a Strong Online Tutor

Here are some tips I learned based upon mistakes I’ve made along my online tutoring journey so far. Learn from my mistakes, so that you can avoid making mistakes yourself:

  • When it comes to subjects, less is more. You may have excelled in various subjects when you were in school, but this doesn’t mean you are ready to tutor them all. You need to be extremely proficient in one subject area. This will benefit both you and your students. Be humble here. 
  • Ensure you know the tutoring platform inside out, including the virtual classroom, so that you can help students resolve technical issues.
  • Do everything in your power to break down the digital barrier and make the student feel comfortable. This will allow the student to open up, ask questions and truly learn. As mentioned, an intro video on your profile can help generate trust and comfort right away. 
  • Get the student actively involved in solving the problem. Don’t just solve problems for them. The student learns the most when they are engaged. 
  • Engage the student before the tutoring session to learn about their problem. This will allow you to research their problems and verify that you have the necessary skills to help them.

A good student experience will keep the student coming back to you, and will generate good reviews that will draw in new business.

An increase in demand for your tutoring services brings you more time flexibility, and you can even increase your pay rate on commission-based platforms.

Conclusion

Online tutoring is a flexible and rewarding side hustle idea that can help you diversify and increase income. You can use this extra income at a young age to undergo compound growth to build wealth for future freedom.

We focused on two tutoring platforms and how to apply on each: Skooli and Preply. I use Skooli due to their good pay and flat rate pay system.

Once you are “hired” you simply need to focus on being a good tutor. Provide a good learning experience to the students and you will get more business, adding to your flexibility. Focusing in on one field is a key enabler to improve the student experience.

Let me know if you have any questions or additions in the comments below.