Mr. Usiere Uko, the author of ‘Practical steps to financial freedom and independence’, explains ways people can earn money from more than one source
When it comes to developing multiple streams of income, most folks tend to think it means taking another job, working overtime or starting another business by the side. Developing multiple streams of income is not taking another job. It could be a business you do during your free time, but that is not the starting point.
The starting point is to change your mindset from depending on only one source of income, to expecting multiple streams of income. When you start to open your mind to that possibility, then ideas will start to flow.
Starting a business is not something to rush into. You need to take your time to do your homework well. You need to acquire entrepreneurial skills to enable you navigate the world of business. If you approach business with an employee mindset, you may not go very far. You also need time to save up your seed capital. Loaning money to yourself to start a business is your best option when all you have is an idea which may be difficult to inspire others enough to risk their funds in the venture.
Make your money work for you
The easiest way to develop an additional stream of income is to have your money work for you. You can start by investing your savings in the money market at zero risk to earn interest income. Most people overlook this because of low interest rates and seemingly inconsequential amounts earned as interest when starting out. When you save consistently, you grow your principal sum rapidly and the interest earned begins to add up to something reasonable. If you save 20 per cent of your gross salary, you will have saved up your gross pay in five months, and 2.4 times your gross pay in a year. In five years, you would have saved your annual gross income.
By the time compound interest works on the sum, coupled with moving your money into treasury bills, bonds etc that yield more than 10 per cent per annum, depending the rate, you may have a balance of two years gross income equivalent in your money market fund. By the time you maintain this discipline for 10 years, your monthly interest income may have exceeded your monthly expenses, meaning you can do without your salary. The compound interest is called the eighth wonder of the modern world. With compound interest working for you, your small beginnings of earning seemingly inconsequential amounts from your savings do amount to a lot.
Multiple streams of income ideas
Apart from putting your savings to work, there are unlimited ways of generating multiple streams of income. You are only limited by your imagination. While brainstorming ideas for multiple streams of income, you need to focus on passive income – income that comes to you perpetually for work you did in the past. You do not have to work at it full time. After it has been set up, you need minimum amount to time to keep an eye on it. You can write a book, “How to” special reports, develop a course, write a song, a play, a film script, develop software, an app, commercial blog theme, own a blog, website, join an affiliate programme, do graphic designs (e.g. book cover designs, album covers, films etc) and negotiate for a commission on sales rather than an outright payment, the list is endless. You can create a fashion line or catalogue, start a fitness club, karate club etc and hire professionals to man it while you keep an eye on the business side. You can start a rental business and hire people to do run it. A lecturer can write textbooks, own online education websites, develop multimedia learning aids etc. We are all creative. All we need to do is to start to believe in our God given abilities and put our minds to work.
Since you have a full-time job, you don’t want to take another job. You want something that does not take too much of your time. There is no limit to the number of income streams you can develop. One of your goals should be how many income streams you want to bring on board within the year.
Have the right focus
You need to remain focussed on one income stream and see it through it is fully established before you start on another. Avoid the temptation of going after several opportunities and doing a poor job of it. If you spread yourself too thin, you may not get any meaningful result. There is a proverb that says “if you chase two rabbits, both will escape”.
The most important decision you need to make is the decision to develop multiple streams of income. Do not bother about how. As you start moving, you will find a way to make it happen. There are resources and people out there that are willing to help. Whatever challenge you may face along the way, someone has faced same, overcome it and told the story somewhere on the internet. All you need to do is seek, and you will find.
While considering a stream of income, avoid the temptation to focus on money, but rather on the service you want to render. If you do a good job serving others, they will be very willing to part with their hard earned money. When you focus on money, service will suffer and your income will drop. Focus on areas you are passionate about, areas you have skills and enjoy doing. That will give you the energy to keep going even when the going gets tough. Excitement gives you energy and brings out the best in you. Taking your hobby to the next level is a good place to start. You can turn your hobby into a business. Making money while having fun gives a very good feeling. Many have taken this route to exit paid employment and followed their dreams.
Most of the ideas do not need money to start, if you already have a computer at home. There is hardly any business you cannot start small and grow by reinvesting your profits. Take your eyes off the obstacles and focus on what you can do with what you have. Where there is a will, there is a way.