The importance of income diversity
In the financial world, we often talk about investment diversity and how important it is when investing to not place all of our eggs in one basket. Why? Risk mitigation. If one area “flops”, chances are other investments won’t.
People with even the smallest amount of investing experience recognize this strategy and practice it. What amazes me though, especially in today’s economy, is that these same people work one job, for one company. If by chance something happens to that job, their income stops.
One of the many valuable lessons I learned back in 2006 during our “major life crisis” was the importance of not only having diversity in your investments, but in your income as well. With layoffs increasing by the day and companies looking for every opportunity they can to cut expenses and stay afloat, the concept of income diversity has never been more important.
Income diversity is all about having income coming in from multiple and independent sources rather than just one source like so many people do. Income diversity can involve:
- Income from interest on savings and investments
- Multiple jobs
- Passive income from websites or businesses
- Hobby income
- Moonlighting (working multiple jobs at the same time)
One of the best ways to begin diversifying your income is to look at the things that you do (or can do) and think through how you can turn those activities into income. Here are just a few examples:
- Do you like taking pictures? Start a small photography business taking pictures for friends and businesses
- Do you enjoy marketing and selling? Start an eBay business or start an online store.
- Are you good at making crafts? Sell your crafts on Etsy.
- Know a great deal about computers or skilled at creating graphics? Consider doing some freelance work.
- Have a little extra time in the evenings or weekends? Work a part-time job.
These are of course just a small handful of the options you have for earning extra income. Options are limited only by your imagination, skill set, and public demand for your services or product.
How I diversify my income
I often get asked about how I diversify my income and the types of things I do to keep multiple revenue streams coming in. While I am constantly trying out new ideas, here are the items I currently have in my “income portfolio”:
- Full-time employment – I work full-time as an IT manager in the financial industry. This of course is my primary income stream.
- Blogging – I currently run and write on three different blogs: Gather Little by Little, a new restaurant review blog I started called: Waynesville Restaurant Reviews and on blogging (especially about Thesis) over at my Empty Cabin Media blog.
- Online Stores – I also run a few different online stores that are really affiliate marketing sites, promoting products for other companies. Due to protecting my niches I don’t want to share these, but the income from these sites has slowly grown over the past year. If you’re interested in this option, read my article Starting an online store.
- Adsense Sites – Recently I’ve also built a few sites for niche markets where I’ve been paying to have search engine optimized content written and these articles get published onto my niche sites. These sites have various affiliate offers, but primarily are monetized using Google Adsense. They are more or less blogs, but since I am not doing the writing, I’m a little hesitant to call them that.
- Blog consulting – Next to Gather Little by Little, my biggest alternative source of income is blog consulting through my company Empty Cabin Media. For regular readers, this is something you’ll recall I started doing a few months back and to my sheer delight I’ve had an unexpected amount of success with. I fully expect Empty Cabin Media to become second only to my full-time employment as far as income diversity within the next month or two.
Time for some changes
At this point some of your are looking at this list and thinking: The guy has 6-kids and does all of this, how in the world does he have the time? I’ll be honest, it’s a struggle. I stay up late, get up early, work on weekends more than I would like, and honestly have been sacrificing family time (which I don’t like to do). All of these are things I was fine with doing in the short term to begin building up my income diversity, but now it’s time for a few changes.
Being successful is business is frequently the result of recognizing new market opportunities and taking advantage of them while you can. One of the important decisions I made recently was to not only begin moving my websites to the new Thesis WordPress theme, but to focus on becoming a Thesis expert. As a result, I consistently have 3 or more paid Thesis consulting jobs a week and the demand continues to increase. I’ve even started outsourcing some of the work. There is a tremendous opportunity here for me to quickly grow Empty Cabin Media and I need to take advantage of it.
In order to do that and not overextend myself or hurt my family, I’ve made the very tough decision to cut back my posting here on Gather Little by Little. Instead of writing 4 articles a week and then a Friday Gathering I’ll begin today with publishing 3 articles a week, most likely on Monday, Wednesday and Friday. My Friday Gathering posts will move to the weekend, on either Saturday or Sunday.
This will be the schedule I’m shooting for, but it may vary some based on my work load. I just wanted to make you aware that I won’t be posting everyday, so expect that a day or two may go by without an article being published.
Not only will this decision give me more time to spend on my Empty Cabin Media work, but it will also allow me to focus more on my articles in order to give you more high quality content, which frankly I think has been declining over the past few weeks as my schedule has become more and more overloaded.
One other option I am also considering at this point, is to hire another writer for Gather Little by Little to write with me. This isn’t a decision I am 100% comfortable with yet, but the more I consider it, the more I like it. The big benefit to you would be very high quality articles from someone with similar views and beliefs as me, but of course a different writing style and perspective. In other words, you wouldn’t have to read just my stuff all the time here on GLBL, you could read another Christian authors articles as well. I am still thinking and praying on this one, so I’ll keep you posted.
I would love to hear your feedback on all of thees decisions. You guys are very very important to me and I hope you understand my dilemma and the potential benefits going to 3 days a week will have for you as well. Let me know your thoughts by leaving a comment. Oh, I’d love to hear your thoughts on possibly having another writer here on GLBL as well. Now go diversify your income!
Photo by: willia4