One of the clearest ideas that wealthy people have is that a person (or a family) should never (under any circumstance) have only one source of income. If any young person could understand this principle at an early age, they will have a huge advantage as they grow old. Also, young families today could and should consider having multiple sources of income. But what exactly do people mean when they say multiple sources of income? In this short article we will explain what does that look like, and how to get started.
But first let me use this analogy, I think it explains the concept of multiple strings of income well. Have you seen a car battery? Most people have seen one and know what it is, and how it works. It is a simple concept: the battery stores tiny amounts of power inside of it, that can be used as it is needed to start a car. What most people don’t know is that a car battery can also be used to power a house. Yeah, a battery by itself does not have enough power to sustain a full house, but if you have multiple batteries connected the right way, they can add enough power to sustain your house. A silly analogy, I know, but I think you got the point. One source of income is like that single battery, good enough to power a car as needed, but not good enough to power something bigger, like a house. However, having multiple sources of income, like several batteries, can give you enough juice to be financially free, and not dependent on one job.
Multiple sources of income can help you achieve your goal (whatever that might be) faster and easier. Now, that does not mean that having multiple sources of income is easy, but if you work hard enough to get several, you will see how your wealth will increase faster.
A few tips for you to get started:
First, start an online business. I read an article where several millionaires were asked, what would they do if they had $1,000.00 to invest, and most said they would start an online business. Online businesses are getting more popular and very profitable. More and more people buy stuff online, and the trend seems to continue to go up. Pros: Online businesses have very low overhead, and are easy to set up and start. Since most people work from their homes, they can work on their spare time. Cons: they might take several months and sometimes years to start generating significant amounts of money. Here is a useful article about starting a business with $1,000 or less.
Second, use your skills to make money. You know how to draw, take pictures, or fix a car? Use that to make some extra cash. Skills can generate good money if you use then wisely. I have a friend that works doing small house repairs on the weekends (Saturdays mostly) and makes about $300 extra a week. Not bad for a few hrs. of painting, drywall repairs, and such. That is extra income he makes on the weekends or after he gets out of his 8 to 5 job. Pros: Skills can be very useful, and it might be something you are passionate about. If you have one, use it! if not, learn one that you might like. Cons: services like this can take a bit more time (like driving to places) and gas money. Here is a cool site where you can advertise your services online to entrepreneurs that might be looking for your skills.
Third, use extra cash you might have to invest money on an online trading platform or a robot advisor. These two forms of investments are also getting to be more and more popular. Use extra cash you might get, like a Christmas gift or an old payback from a friend that owed you money, and invest it on mutual funds. They usually give good returns and years later, you will be glad that you used that money to make more money, instead of spending it on a new pair name brand shoes that might last a few years. Pros: Money invested on online trading platforms can generate good returns if they are invested right. Cons: it might be risky, and the money needs to stay there for a few years to see any gain.
Fourth, rent a room in your home. You have a house, and have extra space? Rent it out. Sites like Air BNB offers very flexible options for people to rent their extra space with very little effort and investment. You also have a ton of control in who you get into your home and when. If you are not uncomfortable having a stranger at your house for a while, rent the space out, it can generate some extra income to help you achieve your goals. Click here if you want to get set up with them. Pros: Very little time to set up and start getting money out of it. Cons: it might be hard if you have little kids, since you must give up a little privacy.
There you have it! four simple suggestions, that can help you get started on your way to multiple sources of income. Even better, you can do several of these at the same time! Like renting a room and investing the money you make out of it on mutual funds! Double the cash!! But the point is, don’t delay, get started right away and start building your own sources, who knows, in a few years you might not even need your 8 to 5 job any more. Enjoy!