17 December 2024
Colette Machado
Financial Education
Whether you're employed, run your own business or are a freelancer, having just one source of income in today’s society could be risky.
During the pandemic, many people lost their jobs as a result of companies closing down or downsizing. This proved the old adage, don’t keep all your eggs in one basket, and provided solid evidence that we need to have more than one stream of income.
Hopefully we won’t be facing anything on that scale in the near future, but it never hurts to be prepared. If you have only one source of income, such as a traditional 9-5 job, and something happens to that income stream, you could find yourself income-less which would heavily impact you and your family. But if you have multiple sources of income, you have other streams to fall back on.
Financial genius Warren Buffett says, “Never depend on a single income. Make an investment to create a second source.” Warren Buffett focuses on creating his income streams through investments, however other examples of common sources of income include rental income from property, freelancing and having a part-time job or business (sometimes called side hustle).
Two Types of Income: Active and Passive
There are two main types of income streams that we need to understand: Active and Passive.
Active Income: Active income is money earned through direct effort, such as working a job, consulting, freelancing, or running a business. Active income requires your time and energy, and typically stops when you stop working.
Passive Income: Passive income is money that is earned with little to no ongoing effort after the initial set up. This can include earnings from letting properties, dividends from stocks, royalties from books or music, or income from a product or course that you sell online. Although passive income does often require upfront work or investment, it can generate steady cash flow with little ongoing active involvement.
Having multiple streams of income – active and passive - is one of the smartest financial strategies to build wealth, reduce risk, and achieve financial freedom.
“Never depend on a single income. Make an investment to create a second source.”
– Warren Buffet
Have a Millionaire Mindset and Diversify
Millionaires generally have multiple income streams that they use to build their net worth and secure their financial future, such as:
Earned income: Income from working a job
Rental income: Income from owning and letting properties
Dividend income: Income from stocks
Royalty income: Income from intellectual property or inventions
Capital gains: Income from selling assets that have increased in value
Business Profits: Income a business makes after subtracting its expenses
Interest: Income from savings, bonds, or lending money
Just like how an investor spreads their money across different stocks and shares to minimise potential losses, millionaires understand the importance of not relying on a single source of income.
Even the Bible seems to give this advice: In Ecclesiastes 11:2, it says "Invest in seven ventures, yes, in eight; you do not know what disaster may come upon the land". (New International Version)
Ideas for Getting Started
If you currently have only one stream of income, creating seven isn’t something you can do overnight. However, you can make a start.
Where to begin? Start where you are... Use what you have... Do what you can.
Use your current skills: If you’re skilled in a particular area, e.g. photography, you could start seeking work as a freelance photographer to bring in extra income. If you’re very creative and like designing, maybe graphic design work could be for you. It does, however, take time to learn skills and build up an income in these areas if you are a beginner.
Take a part-time job: One of the easiest ways to create a new income stream is to get started with a part-time job or business opportunity. A business opportunity will give you more freedom to choose the hours that suit you as well as other benefits.
Start a business: While many businesses have high start-up costs, there are businesses where this is not the case. Look for a business with low start up fees, where you are in charge of your own time, where you can work from anywhere and where you can scale and grow your business and your income.
Genistar as an Additional Income Stream
As it happens, Genistar can provide just such a business opportunity. We are always looking for honest, hard-working people who would like to build a business and earn additional income, part-time or full-time, by providing financial education to families.
If you would like to find out more, read on….
Who is Genistar?
Genistar is a UK-based financial education company licensed and regulated by the Financial Conduct Authority.
In addition to providing financial education, we also offer an exciting business opportunity, in which you can work part-time at hours that suit you, working around your current commitments. On average, a licensed Genistar representative can earn around £500-£1000 a month working six to eight hours a week part-time.
Currently operating in the UK, Genistar is expanding rapidly. We have representatives in most of the major UK cities.
See more: Who We Are | Genistar
What We Do
Genistar’s mission is to help everyone secure a better financial future. We provide our clients with the necessary knowledge to make smarter, more informed choices. We also offer a complimentary Financial Plan to help them achieve their financial goals and achieve financial independence.
See more: What we do | Genistar
“Start where you are…. Use what you have…. Do what you can!”
– Arthur Ashe
Are You Ready to Start Building More Income Streams?
As highlighted in this article, creating and building multiple streams of income – both active and passive - is a great way of reducing risk, providing financial stability in the short term and medium term, and increasing wealth over time.
Whether it’s through freelancing, investing, creating digital products, or taking up the Genistar business opportunity, let your income streams work for you so that you can create a more secure financial future for you and your family.
Financial Freedom for All | Multiple Streams of Income
Watch this episode of our podcast that focuses on unlocking the secrets to building multiple income streams, featuring inspiring insights from our expert guests.
If you would like to find out more, please contact your Genistar Representative or contact our Support Centre
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The information provided on this website is for educational or informational purposes only. Please refer to our legal disclaimer for further information.
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