⇶ Income Streams: They Don't Just Come From Side Hustles

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Most of us work a day job or 9-5, and Nick discusses leveraging your day job to build toward your financial goals.

He did this himself by growing from $1k to $100k in 3 years through a blue-collar job.

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When you think of multiple income streams, what do you think of?

Probably

• 24/7 grinding

• Starting businesses

• Working a second job

• Spending hours each day to earn money

In reality, that is a very limiting way to look at multiple income streams.

Why Are Multiple Income Streams Important?

To sum it up in a single image

Multiple income streams protect you from surprises that would topple you if you only have one stream.

Anything from a job loss to temporary unemployment (see COVID) to rising rent (again, see COVID) can be enough to put someone with a single income source in financial jeopardy.

In contrast, multiple sources of income allow you to compensate for higher expenses or lower primary income through your additional sources.

We want to play defensively with our money.

Where Can Additional Income Streams Come From?

Side Hustle

Of course, we have to state the obvious quickly.

Building a business on the side, tutoring, coaching, ridesharing, and taking on a second job are all examples of side hustles.

The biggest downside of these is the time commitment.

To earn any income, you must commit time to marketing, preparation, and execution.

The biggest upside of a side hustle is the lack of an income ceiling.

There is no actual barrier to what you can earn in a side hustle as you are able to devote time and develop your craft.

Side hustles can lead to people quitting their “day job” altogether and earning even more in their side gig than they ever did with their main gig.

Investments

This is where the concept of multiple income streams gets broadened in a way it generally isn’t.

Investments are a fantastic source of income, whether through appreciation or dividends.

To turn this appreciation into income, you can either take out loans against the higher value, such as in real estate or withdraw the returns and use them as you see fit.

It’s never ideal to withdraw returns as you interrupt compounding, but it can be a literal lifesaver in an emergency situation.

A dividend is any recurring payment from your asset in exchange for continuing to hold it.

In the stock market, dividends are cash payments made directly to investors in exchange for them holding the stock.

In real estate, rental payments from tenants can be seen as dividends in return for you holding the property and building.

It’s always ideal to reinvest these dividends to supercharge your compounding.

However, if you’re in between jobs and need some support, this can be a reliable and direct source of income.

Passive-ish Income

Very few forms of income are entirely passive.

They will all require some sort of upfront or continued effort or risk to function.

The key is focusing on income sources that require upfront effort instead of continued effort.

Income sources that only require upfront effort are versatile because you can put in the upfront effort whenever you have time (i.e. nights or weekends) for a short time and let it ride from there.

A prime example of this is building a product.

For example, building an eBook requires upfront work to decide on a topic, perform research, write, edit, and market.

But, from then on, it requires no effort from you except for periodic marketing and continues to generate income.

Another great example is building niche tool websites.

A niche tool site is a simple website built around a single tool that generates ad income.

Think of a website you’ve gone to to get a word count for your writing, capitalize your title for you, calculate your BMI, or convert units.

With some coding knowledge, you can get this set up rather quickly, push traffic with ads, and generate income through ads on your site.

With little to no coding knowledge, you can hire someone online for cheap to program the tool you have in mind and follow the same process as above.

(By the way, I have set up several of these kinds of sites myself and would love to help you get started in a coaching call. Don’t worry about the title of the call focusing on finances.)

Regardless of what you decide, the goal is to generate income that will continue with little to no effort from you, even if you lost your primary source of income.

Savings Returns

A traditional savings account only earns ~0.01% interest per year.

That isn’t the kind of account I’m talking about.

I’m talking about high-yield savings accounts that earn ~4.4% annual interest.

Of course, the income you can generate from your savings will entirely depend on how much you have saved.

But don’t sleep on these returns. If used properly, high-yield savings accounts have the ability to cover you during a lapse in employment.

If you’re interested in more personal 1-on-1 coaching with these kinds of topics, I now offer:

• FREE Money Minute Call (quick questions, 15 min)

• Investing Foundations Coaching (30 min)

• Wealth-Building Coaching (45 min)

• Excel Consultation (1 hr)

• FREE Budgeting and Investment-Tracking Tools