Diversify your income streams. Multiply your money.
Diversifying your income streams is a strategic move that provides a safety net in case one source of income diminishes. Identifying the right combination of income streams that you can effectively manage simultaneously is pivotal.
The IRS shared data showing that the typical millionaire sustains seven distinct income streams, each falling within specific categories.
For the purpose of this discussion, we will concentrate on the initial four categories.
Strategies for Amplifying Earned Income
Consider either changing jobs or requesting a raise from your current employer. Statistics indicate that one in five job changers secures a 10% to 20% salary increase by transitioning roles. Conversely, the average annual raise for those who remain with their current company is merely 3%.
If changing jobs isn’t on the horizon or if you have a strong attachment to your current position, you can utilize the provided script to negotiate a pay raise.
Ways to Augment Dividend Income
If you haven’t yet embarked on the journey of investing, now is the moment to initiate that step. If you are employed with a fixed salary and your workplace offers a 401(k), consider consulting your HR department for insights into your investment account and the company’s matching policy.
For those who are self-employed, a comprehensive guide detailing investment options tailored to your situation is available here.
Alternatively, a Roth IRA might be suitable for those who don’t fall into either of the aforementioned categories. M1 Finance, Betterment, and Fidelity are all viable choices for investing.
Methods to Boost Interest Income
Opening a high-yield savings account (HYSA) is recommended. While similar to a standard savings account, a HYSA permits you to earn interest on your savings, thus constituting one of the most straightforward avenues to generate passive income.
Top choices for HYSA include Ally Bank, SoFi, and Marcus by Goldman Sachs. It’s worth noting that a HYSA should not be regarded as a replacement for investment endeavors.
Approaches to Enhance Business Profits
Entrepreneurs can consider innovative strategies to bolster their revenue streams. Below are some concepts to stimulate your creative thinking:
- Feature Your Product on TikTok Shop
Leverage TikTok’s newly introduced feature, TikTok Shop, which allows vendors, brands, and creators to showcase their products through videos. These videos come complete with clickable links, enabling viewers to swiftly make purchases.
This feature has propelled obscure brands, such as a company marketing frozen whole chickens, to viral fame and the sale of thousands of units.
- Participate as a Software Affiliate
If you frequently recommend software products to acquaintances or clients, becoming an affiliate for the software can be lucrative. When someone signs up using your referral link, you earn a commission.
- Venture into Consultancy
Monetize your unique talents by offering consultancy services. Whether you’re skilled in voiceovers, real estate, styling, dance, or music therapy, capitalize on your expertise. Provide personalized sessions for newcomers and established brands, charging an average rate of $100 per hour, as per HubSpot.
- Retail Packs of Fonts, Templates, or Design Elements
Designers and creatives can consider selling bundles of design components like icons. An example can be found on Etsy, where a $3.00 bundle of icons has generated substantial passive revenue through over 559 sales.
- Market Website Templates
For web and graphic designers who frequently construct websites for clients on platforms like Showit, transforming these creations into templates for sale is a viable venture. See Becca’s approach, selling websites for $8,000.
- Launch a Blog
If you possess expertise in a specific domain and enjoy writing, starting a blog is a strategic move. While the initial effort to establish the blog might be significant, the potential for long-term profitability is substantial. Jannese Torres, for instance, generated over $105,000 in passive income from her food blog last year.
Diversifying your income is an important step in building financial security. By choosing the right combination of strategies for your individual situation, you can create a secure financial future for yourself.