Monday Motivation: Creating Multiple Streams of Passive Income

We're moving right along in our Financial Success series.  Today's conversation is one very near and dear to my heart.  At the start of my financial journey, I took small steps based on my means at the current time.  This meant that I first began to save a portion of my income each paycheck.  Once I mastered saving, I strategized on how I can increase my work related income.  These moves seemed to be working well for me until my mind was rocked after reading this article on the 10 reasons why You should not get a job.  He actually had the nerve to call getting a job as a sole source of income, a stupid thing to do!

 The biggest flaw he saw in the job for money structure is how limited the income earning potential is.  Currently I work a ton of hours and I make a living of it.  But if they were to call me today letting me know that my position has been eliminated, the money stops coming in.  All of the hours and hours of work I've invested into the company for the last three years produces no more financial value for me once our working relationship ends.

 Trading money for time is an old fashioned model of earning income.  If you wish to create additional financial abundance in your life, consider investing your time in ways that generate income passively.  Ah yes, passive income.  I first learned of this term after listening to Robert Allen's book, Multiple Streams of Income.  That book was life changing for me.

Suddenly, I began to see my money very differently.

1. I realized that "active income," working for dollars was not ideal based on the risks involved.
2. I began to see my income from work as a tool to leverage in generating passive income.
3. I worked to set up additional income streams aside for my job.

Here's where it gets interesting.  Remember when I mentioned that sometimes I stroll through the wealthy areas of town gazing at the lavish homes? Back when I worked in an office, I would drive there on my lunch breaks. What did I see in the middle of the day? I saw joggers, people working in their yards, cars in the driveway, others dining at local cafes. That's when it hit me.  These people aren't working right now! They probably don't have to work right now like everyone else. They make their money differently from us.  

Robert Allen lists at least a dozen ways to make additional streams of income in his book.  I did put some of his ideas into practice. More importantly, I opened my mind to the idea of making money in more ways than just working.  Since then, I've continued to educate myself on the subject. They key is to focus your activity on avenues that continue to generate money with medium to little involvement, on your part after the initial investment.  Here are some examples.

1.  Investing in a stock.  (Back when the economy crashed, I invested in Apple, GE and other stocks. It was an action I took once but it continues to earn income passively, years later, without me doing anything else).
2. Enrolling in 401(k)
3. Writing a book or e-guide.
4. Generating income from a website or blog.
5. Creating and selling a physical product (easier than you think).
6.Creating and selling an E-course. (pretty much everyone reading this has knowledge that others are willing to pay for)
7. Income from rental property/real estate
8. Creating an Iphone App.
9. Network Marketing (MLM)
10. Promoting other's products (celebrities do this a lot with endorsements)

Passive income could take a lot of work up front before you see great results.  In most cases, the income from these sources may not be that big, but the idea is to create Multiple Streams of Income so money is coming from different places at all times (even while you sleep).  If you're thinking, that this seems out of your reach, start at the beginning.  Interest paid on your online savings account is a form of passive income.  Company match on a 401 (k) is another. You can set up those sources today.  Once you have two sources, you can start to think about others.  More importantly, when your paycheck gets deposited on Friday, instead of thinking of how you will spend the money, reflect on how you can invest a portion of it into creating a passive income stream.

I've been slowly building income streams for a few years now. I lost my focus the last year but I'm ready to get back on track.  The key thing to remember is that there are infinite ways to create passive income.  Don't get caught on the list above.  It's more important to fall in love with the idea of generating income passively.  YouTube partners are generating income today from videos they created long ago.  That idea wasn't even around when Robert Allen wrote his book.  Be grateful for the income you receive from working and, at the same time, see it as an opportunity to begin an investment into some greater...something longer lasting.

Please check out the Multiple Steams of Income book, he goes into great detail on why passive income is important, how it works, and how to do it!

Thanks to the anonymous poster who commented on how to create outside of work income. If anyone else has questions or would like me to talk about specific topic on financial abundance, let me know in the comments below.