Welcome back! Today we are going to cover a very hot topic – multiple streams of income.
Not quite sure what that is? No worries, we are going to dive deep into this today.
A traditional home will have one or two people working one job with each bringing in money from that job.
Multiple streams of income is when one household with one or two working age people bring in money from 3, 4, 5 or more resources.
Sound like something you are interested in? I bet it does! Most people would love to live like this but few are willing to do what it takes.
If you are someone who is looking to find ways to generate extra money outside of your traditional job or business, then keep reading.
Let’s establish something first, it takes time to get to a place where you are bringing in money from different places. It generally doesn’t happen overnight. That’s okay though! I get the feeling that you are a motivated person who is willing to work hard and make things happen.
Let’s get started. Here are the reasons you need multiple income streams:
Let’s start with Job Insecurity first:
Job security is truly a thing of the past. My in laws worked for an oil refinery for years and they both retired with great pensions and full benefits. Those days – are over!
Let’s take a look at reasons your job is NOT secure.
1. Job Loss
The sad truth is no one has job security anymore. You can be replaced with someone who is younger, smarter or more experienced as quick as tomorrow! You have NO idea what could happen with your company, the industry or the economy.
I wish that we were all secure in our jobs but if you talk to any group for very long you will hear stories. Everything from recent lay offs due to downsizing, a robot is now doing their job or the company will be outsourcing that division by the end of the year.
It has become commonplace and should be a wake-up call for all of us.
Your job could be gone tomorrow for any number of reasons!
Often times, it has nothing to do with your job performance or ability. It is more about lowering costs and the bottom line for the company.
I don’t know anyone who gets up on January 1st of a new year and says, “This year, I am going to get cancer and will be out of work for 6 months recovering.”
The sad irony is, it happens to thousands, every day and in every country of the world.
You don’t plan for illness. It just happens. You don’t plan to be out of work for weeks or months, it just happens.
Getting hurt in a car accident, a fall, or any type of unexpected event can happen in a moment and without warning.
It hits you or your family and can seriously affect your job.
This could be injury to you or a member of you family. Depending on the severity of the illness you could be out of work for a week or even months.
Some jobs will work with you but others can’t or won’t be as patient.
What can multiple streams of income do for your financial picture?
The list can be long on this one but let’s cover the most obvious.
1. Pay off debt.
Millions are deep in debt and have no idea how or where to start digging out. I have been there and totally understand how that feels.
Side income from several places can be a way to decrease debt faster. You could easily dump an extra $500 to $1,000 a month into a student loan, maxed out credit card or a crippling car payment.
As a side note, eliminating debt with multiple streams of income could very well be the ticket to other dreams like being a stay at home mom.
2. Fund retirement.
Regardless of your age, everyone needs to be saving for their future. I know from experience how hard it can be to dig up an extra $5500 for that Roth IRA each year.
When you’re paying for bills, a mortgage, food, kids activities and everything else – you have little left for building your future.
Having several income streams will help to make sure that your future is paid for every single year.
3. Fill up an emergency fund.
I am a HUGE believer in this. Every family needs an emergency fund. Without one, you are basically inviting destruction into your life.
You can read my entire post on emergency funds here – but in short, without one your financial picture could be completely destroyed overnight!
Having multiple income streams could help you fill up your emergency fund quickly.
4. Be a source of income if your main source suddenly disappears.
Unfortunately, situations change all the time in our work. Job loss, job change, or family emergencies.
If you have a couple of ways to make money then you will won’t miss a beat if/when something happens to you main source of income.
5. HERE IS THE ULTIMATE GOAL: Slowly become a way for you to ditch your day job.
If you have ever dreamed of owning your own business or working from home then this could be a way for you start slowly. At first, it will be a side gig to generate cash for things your family needs.
If done well, over time, it could become a way for you to fire your boss and live the life you have dreamed of. Rarely does this happen quickly. It will generally take time but would be well worth the effort when you were able to walk away from your soul sucking job.
How can multiple income streams create fun?
This list could be very long but I have highlighted my favorites here.
1. Funding vacations.
I don’t know about you, but if I don’t get to go to the beach every summer, I feel deprived! I equally love the mountains and site seeing at popular destinations. Vacationing for me is in my soul and I love to travel almost anywhere!
Having several income streams could be a way to pay for that dream vacation to Disney, Europe or Alaska.
2. Pay for family fun in your area.
I love to go out to eat, go see movies, order take out, and do fun things in our area when we our girls are out of school. Many families are barely getting by and being able to do fun local things might not be possible if there isn’t room in the budget for it.
Having an extra income stream could pay for any kind of local family fun you have in mind.
3. Give anonymously to those in in need.
I have been able to do this over the years in different ways. If I were totally honest, it has been a highlight of our lives to bless others with vacations, chunks of money or groceries throughout our marriage. As a general rule, in the beginning, those multiple income streams are highly needed in your personal family and budget. However, long term they can be a way to give to people and organizations that need what you have.
Yes, I consider this FUN!
How can multiple income streams help with your kids?
1. Fund your kid’s activities.
Kids are SO expensive! I have two and I am constantly doling out money for…
- and more.
It is tough to plan financially for ALL of the things they are involved in. Having a couple of side income streams would go a long way to pay for those types of activities.
2. Pay for braces.
This is something I understand very well. As a former dental assistant for almost 25 years I know how expensive dental work can be. Orthodontics even more so.
Putting braces on your kids teeth isn’t required but it sure makes their teeth beautiful and that smile will last a lifetime. Sometimes, families just cannot afford that luxury though. It is costly and can get pushed aside if the money isn’t there.
Having a side income stream could pay for this type of expense.
3. Max out your kids college fund each year
College expense is outrages these days! If you child decides to jump state lines and go to college outside of your home state is is even worst. Funding your kids college early on with a savings plan is expensive but necessary. Having a side income stream would be a HUGE bonus for any family.
4. Pay for your kids trips
This could include trips for band, choir, cheer-leading, theater and even mission trips through your local church. Those trips are expensive! Not to mention the spending money they will need while away. Having a side income stream could fund the entire trip from start to finish!
How can multiple streams of income help in other areas?
1. Pay for Christmas each year.
This is an expense that can kill a family budget in just 30 days! We spend more money between Thanksgiving and Christmas than we do any other time during the year.
Most families are strapped for cash though, so they have a hard time saving for something that is months away.
Having an income stream that is designated for Christmas savings is a way to keep you from going into debt and eliminates stress too!
2. Pay for birthday parties and gifts throughout the year.
Birthday parties can be a true budget buster! Kids parties, whether at home or a venue, can run several hundred dollars EASILY! Most families don’t have that much extra laying around. Another element of this category is gifts. There is always a birthday, anniversary, wedding or shower gift that needs to be bought.
This type of spending can kill your budget!
A side income stream would be a huge help in paying for those types of expenses.
When should I start a side income stream?
TODAY! I feel strongly that everyone should have a side income stream regardless of how much money you do – or do not make. If you have no idea what type of income stream to start you can click here for ideas.
The main thing is to be READY if a surprise hits. Getting a side income stream started could be the ONE THING that keeps you above water in case of an emergency.
You’ll know it’s time to start looking into multiple streams of income when….
- You are sick and tired of living paycheck to paycheck
- You are always short on things like camps for kids, vacations and Christmas
- You never have enough to save for your future
Let’s close this out with a final thought –
Having several income streams really does make sense. Without more than one way to make money, you are asking for a sudden surprise that could devastate life as you know it. If you have read this far I strongly encourage you to consider getting another stream of income going. Do it for you but do it for those you love as well.
If you have 3 or 4 ways that money comes into your bank accounts – and one falters or changes – you still have the others to lean on.
As I said in the beginning of this post, creating those streams will take time. Money won’t just flood your bank account overnight. Typically, it will take a few months to get something going and to a point where it generates cash. It’s worth it though! Take it from someone who has had multiple streams of income for a long time. It comes in handy when you least expect you’ll need it.
Next week I’ll be covering the income streams that we have our financial picture. Be sure to subscribe so you get that post sent right to your inbox.
Forever and always in your corner,
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Here are some of my favorite posts for generating another stream of income: