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What would you do if you lose your job because of a slow economy, illness/injury, or fired by your boss? What would you do if your income stops? Are you overwhelmed by your bills and finding yourself living paycheck to paycheck to pay your mortgage, rent, utilities, and childcare. In this blog post, we would like to discuss multiple streams of income.
Do you have a plan in place that can protect you from any of the scenarios mentioned above? If you answered NO, then you defiantly need to add more income producing streams to your agenda.
Now, you may be thinking to yourself I already work full-time, where in the world will I find the time to add an additional job to my already full plate. I can’t possibly work any more than I already am, we are here to tell you that’s not true.
For most individuals, a full-time position is their main income stream, as they fall into this category, but the goal is to maximize your income to a point where you are generating enough to cash flow and invest into other streams. This is what Melissa and I do, use our income from our job to invest in other businesses to keep them growing. If you have a job that is stress-free it can give you the option to dabble into other business. The great thing about your primary salary is that you can get great benefits, such as health insurance, that can protect you for the time being while you pursuing your other business ideas.
Related Article: How to Start a Business While You Are Working Full-Time
The Journey of creating additional streams
We began our first additional stream of income back in 2006 with our baking company Legacy Cakery. At first, it began as a hobby for my wife, 5 years later she grew it into a business. From then on, we create several additional streams that are profitable. These have involved Affiliate marketing, Blogging, Ads, Baking, Network Marketing (We are currently not building a team), selling products and our full-time job.
If you are a person who values financial security and desires financial freedom, having one stream of income in today society is no longer an option, it has become a necessity.
Related Article: Financial Freedom: What does it mean to you?
If you are not sure what ways to add one or more streams to your monthly income.
Here is a list that can include:
- Rental Income on an investment property
- Income for a room you rent on Airbnb
- Start an Online Business
- Start a Blog
- Something relating to your passion such as baking, personal trainer
- Extra shifts at a local store around the holidays
- An online survey such as… click here to some great survey companies.
And much more. People today are so afraid to not only invest their time but money into a side hustles and solely rely on employment as their primary method to produce income. This practice puts themselves at risk. The more diversification in your portfolio makes you much stronger in case of a bad economy or layoff.
Why it’s Important to diversify your income
Diversifying your income stream is crucial in today’s economy. Protecting yourself and family against the unavoidable ups and downs of economic and industry cycles. According to The New York Times, the markets are up, unemployment is down since President Trump has taken office. But how long will this rising economy last? With threats of going to war, a natural disaster happening around the world, and much more an economic crash is due, the question is when? Because of such a financial risk, you should consider creating at least one or more additional streams to generate cash flow.
How can I get started?
Good question? You want to build streams of income through real estate or businesses that are passive. Once either stream or combined streams has surpassed what you make at your current day position, you can become financially independent. But there is nothing wrong with a Job, if you love what you do and have great benefits, keep your job. The goal is to have enough income to survive for any emergency.
This won’t happen overnight, it takes time, hard work and focuses specifically building one stream at a time as you shape your retirement.
The first goal is to spend much less than you earn, so you can achieve a positive saving rate. This can be done in two ways:
Decreasing your expenses
Increasing your income
When it comes to spending less money, this is the biggest challenges in personal finance. Even you bills may seem small and insignificant; the compound effect can be enormous.
Here are ways to decrease your expenses
1. Bring lunch from home
I see this all of the time. People buy lunch at work on a daily basis and later never could understand where did their money go? If you take a good look at your expenses, you will find some things you can easily change and cut out of your routine. Wasteful spending on buying lunch every day instead of bringing lunch from home can be a dramatic effect that is damaging your savings.
2. Use public transportation
3. Eliminate or reduce your cable bill
Cable services is a huge utility bill you can cut back on. You eliminate your service by watching less television, lower your premium package, get a cheaper service, online streaming media player like Roku, Apple TV, and purchase an antenna for local tv stations. This can increase your savings by doing this alone.
4. Eliminate or reduce your cell phone bill
Look at your bill and see if you surpass your data plan. If you have a low data usage look for a cheaper plan. Some people are purchasing phones with all the bells and whistles and really don’t have any use for it. If you can trim any of those features it can take a huge cut out of your monthly cell phone bill.
5. Reduce your spending on clothes
Stop always spending your time buying clothes online you don’t need or won’t wear. Just because there is a sale doesn’t mean it’s a green light to spend. You can save plenty by buying fewer but high-quality pieces and utilizing what you already have in your wardrobe.
6. Cancel or find a cheaper gym membership
If you are using a gym membership less than once a week, don’t waste your money on any expensive club membership. There are plenty of gyms you can find that much cheaper and also have the same equipment as most gyms.
7. Air seal your windows
Fall is here and winter is right around the corner. Prevent your home from drifts. The loss of warm air in the winter can increase your utility bills. Here is what we use to prevent warm air escaping from our apartment, Outlet Sealers by THERMWELL.
Yes, you can cut back your daily expenses, but you can only reduce your expenses so much before you start sacrificing quality of life.
This is why increasing your income is your 2nd goal. The average millionaire has a minimum of 7 streams of income because they understand that it’s not smart to rely on a single stream by putting all your eggs in one basket.
'Money isn't everything, but it's right up there with oxygen.'Click To Tweet
They said, “Money isn’t everything, but it’s right up there with oxygen.” Most of the time the topic of money or wealth is often discussed and viewed in a negative light. Society has made an image of making money as being greedy or money hungry but the misconception of money is wrong, but a crucial part of freedom.
You usually hear people say any of these words when you mention money.
- “Money won’t make you happy.”
- “Rich people are greedy.”
- “You don’t want to be one of those people.”
- “I don’t need money.”
You will usually hear this from are broke people.
Here are some straightforward tips that can help you right away to bring up your income.
1. If it’s not working stop doing what you’re doing
We hear this all the time but if you aren’t satisfied, then you should stop doing what you’ve been doing. Your current results are what cause your dissatisfying current reality.
The great thing about life there is always an opportunity that presents itself. Regardless of your past decisions, you’re always one decision away from making the right choice.
2. Never let money define you
Always be yourself, your finances have nothing to do with your self-worth. If you have nothing in your bank account or have millions, your confidence should never waiver.
Understand being wealthy is a state of mind, just as being broke. YOU are what defines YOU, not your bank account.
3. Start tracking your profits
Your activities should always be income producing activates. When you set up your weekly schedule make sure this is on the top of your to-do list. Figure out what works and what doesn’t work with urgency. It should be the top three things you need to create income. Mae sure your schedule is consistent to assure you are creating income.
Always analyze what are you doing that is profitable. Focus on what works not what you feel, push your emotions aside.
4. Time is money, place a higher value on your time
Most people don’t value their time but time is more valuable than money. You can always get money, but you can never get your time back. It is always important to invest in your time wisely. Have you ever heard anybody say this famous quote, “You have the same hours in a day as Beyoncé.” And it what you do with your time that determines your life.
Related Article: How did it get so late so soon? (Time Management)
5. The most kept secret successful people won’t tell you, it’s ok to say NO
Are you the type to always over-extend yourself and committing too many things, STOP. Say “no” to anything that is not creating money or not brings value to your life. You have no time to waste. Until you reach your income goals, feel comfortable and secure, then you can say yes, to something. Only make a commitment to yourself that will focus on income producing activates.
6. Surround yourself with successful people
If you realize 4 of your friends you hang out with are broke, then you most likely number 5. Most broke people hang out with broke people, stay away. Elevate your group of friends even family members and reach out those who are playing the game at a much higher level than you.
Look for people who will hold you accountable, and stay on top of you about your daily activities and are you reaching your goals. Not people who will let you off the hook easily. Make sure you choose wisely.
7. Let go of your excuses
You realize the more excuses you have the lower your bank account. Let it go! Realize your mistakes and move forward. Your energy should more be the focus on solutions instead of creating them. Excuses are an easily catchable disease, cure it fast. Those who continue making them will continue to always have money issues.
8. Become a leader not a victim
Stop blaming the world for your problems, and stop thinking the world is out to get you. “The moment you take responsibility for everything in your life is the moment you can change anything in your life.”
Now the question is how fast will you get your grind to start increasing your income? We suggest you take these tips seriously if you want to increase or create multiple streams of income.
The next step is understanding the different types of income to create additional streams of income. Which type of income is right for you?
As we learned from what Robert Kiyosaki taught us about Financial Freedom there are 4 types of income that’s call the cashflow quadrant.
Here are the four types of income:
- Employee Income
- Self-Employee Income
- Business Owner Income
- Investor Income
So now that you’re armed with the basics, how do you create multiple streams of income? First, it will take some extra effort on your part in addition to making this your job to see that this goal is achieved.
You have to build multiple streams one at a time. That takes the focus and specific goals. Once you decide to develop a particular stream of income, work hard on the one thing. Once you have that income stream running smoothly, then you can develop the next stream but again, focus on one until that stream is successful. Continue this blueprint of building income one by one as other opportunities arise.
It takes time to build multiple streams of income. As for us, this is the blueprint we follow. Legacy Cakery took time for its success, now we are focusing on blogging and creating great products. If your goal is Financial independence, start now. It never too late to start but the earlier the better. You need to boost your saving rate and nothing will help you do that better than having several multiple streams of income.
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What do you think about having multiple streams of income? Do you only have one stream or multiple streams? Please leave a comment below.
Build your legacy today!
Melissa & Rodney
Co-Founders, Diamond Legacy Group
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