3 Great Ideas for Creating Multiple Income Streams: One of the keys to financial success is to create multiple income streams. Create your own strategy with this article!
The key to building wealth and financial success is creating multiple streams of income. In fact, the average millionaire has seven sources of income! When you have multiple sources of income, you are not dependent on just one source for your money.
In fact, you don’t put all your eggs in one basket! That way, if you were to lose your job or if one source didn’t generate enough income, you have other income to avoid financial problems .
Part of creating multiple streams of income is developing a wealth-building strategy. This strategy should be based on a combination of four actions taken consistently which I would describe as the “four pillars of wealth creation”:
- Reduce your expenses (debts, living expenses, etc.)
- Establish an adequate budget
- Increase your income
- Grow your money the right way
This article focuses on number 3. Increasing your income allows you to pay off debt faster , save more, and invest more . This can dramatically speed up the time it takes to reach your financial goals. Much more than if you only focused on reducing your expenses.
So let’s talk about different multiple income stream ideas that can increase your income and accelerate your journey to wealth creation .
The 3 Best Ways to Create Multiple Streams of Income
There are three ways to earn multiple income: active income, passive income , and portfolio income. Each requires different effort. You want to diversify your sources of income as you would your investments. Check out these 3 ways to generate income streams.
1. Increase your revenue with active income streams
Active income is defined as income you receive for performing a service or trading your time for money. The money you earn working for an employer or working in a business every day is a form of active income.
In effect, you trade your time and services for the money you earn. Of course, active income takes more time when it comes to creating multiple streams of income.
Examples of active income
Specific examples of active income include your salary, commissions, bonuses, and tips. You can increase your revenue through active income streams in the following ways:
- get a better paid job in exchange for your time and skills
- get a part-time job in addition to your full-time job
- create a side business or a full-fledged business
- Increase the prices you charge for your time and services if you own a business.
2. Increase your income through passive income streams
Passive income is defined as income that your assets bring to you without you having to devote your time or services to them, i.e. your active participation is not required, and is generally associated with the real estate or business.
For example, receiving monthly rent from real estate without you having to put in any significant effort to earn that money is a type of passive income.
Examples of Passive Income
Other types of passive income include royalties, interest paid on bank account balances, network marketing, affiliate marketing income, and other types of business income.
You can create multiple revenue streams through passive income streams in the following ways:
- Do the initial groundwork to add a passive income element to your business. For example, an online course or an auto-delivered service or product, such as a book on Amazon. Something that doesn’t require you to be involved after setting it up.
- Become an affiliate for a product or service you share with your network or audience. It’s always a third party that provides the service and you just earn money for your referrals.
- Invest in rental property and ask for rents that not only cover your expenses but earn you a profit.
There are multiple income stream ideas when it comes to passive income. The more you have, the better!
3. Increase your income with portfolio income streams
Portfolio income is the income you get from your investments. For example, the money you earn by selling stocks in your stock portfolio at a profit is considered portfolio income.
Portfolio Income Examples
More specific examples of portfolio income include interest, capital gains, dividends and royalties.
You can increase your income through portfolio income streams by investing in corporate stocks, bonds, and various types of equity funds, with the aim of growing your investments over time and, in turn, growing. earn you wallet income.
Having a combination of these different multiple income streams is a great idea. Not only will you have multiple sources of income, but you will also have a well-diversified portfolio. This builds wealth and is also a key part of retirement planning.
There are many multiple income stream ideas out there, but it is important that you do your research beforehand for each income stream or investment you are looking for. This way you are well aware of what you are getting into, including the associated risks. Therefore, knowing more about investments and sources of income will put you on the path to financial success.