Building more financial streams isn’t any longer a luxury, it’s become a necessity. If the high percentage and rising job losses have taught us anything, then no human job is safe. Unfortunately for several people, their only source of income is from their jobs, which might be a dangerous way of life. Some couples could also be very lucky and their spouse brings in money each month, but they still depend on work to survive.
Because of the financial risks involved in relying on work for all of your income, it is important to consider having at least one additional source of income. The table below outlines a few reasons why having multiple sources of income is important and how these extra funds can be used.
Here are ten simple reasons why building more incoming streams is so important. Each item listed below is an example of how other sources of income can be used to determine the risk of living on a single income.
Rising Healthcare Costs Whether you are interested in the healthcare revolution or not, you are likely to experience a small amount of high health care costs. Adding an extra source of income can go a long way in paying for things like high medical bills and unexpected medical expenses.
Unemployment How safe is your job? Let’s face it, no job is always safe, especially in a difficult economic situation. Having other sources of income can help you to cope with the loss of your job more easily than you would like to be caught unawares. While some of your resources may be able to cover all of your monthly expenses, they can still give you time to look at things.
Paying for college How much do you save for your college kids? Instead of risking your life by saving for your child’s schooling, why not make an extra effort to help. Having more cash streams of cash on a monthly basis can help reduce the burden of paying for college.
Living within Your Means To build real wealth, you need to be able to live within your means. If it is not possible to reduce your spending continuously, or you no longer want to make sacrifices – create a new source of income. There are only two ways to live within your means – either spending less or making more money.
Pay Money By Purchase How often can you pay for car cash or pay for a major home improvement project without taking out a loan? Second- or third-party revenue streams can be used to save on these types of purchases so you don’t have to take out a loan and pay any interest. The idea is – pay less interest and save more money!
Create New Income Distribution What better way to spend your extra income and use it to increase your income? If you do not need it to survive, why not use your extra income to increase your monthly income and become financially independent?
Pay a Small Debt Paying your mortgage, car, or credit cards is a great help to earn more money. If you can avoid paying tons of interest on a loan by making additional payments on existing debt, then you could be on your way to financial freedom.
aCreate a Holiday Fund This is something my wife did recently after earning some independent income. Instead of emphasizing how we will pay for all the extra holiday expenses this year, we have simply chosen this revenue stream for the holidays.
Manage Your Income When did you last earn money at work? Even if you did get one last year, there is no guarantee that you will get one next year, especially the way the economy behaves. Do yourself a favor and control your finances by creating more revenue streams. That way you have the power to make money if you want to!