How To Create 7 Streams Of Income For Passive Wealth
You may have heard that millionaires often have seven streams of income. Here is how to secure yours!
If you have been consuming a lot of wealth content recently, you probably heard that many millionaires have seven income streams. Indeed, even the Bible says you should invest in seven different ventures. Having various income sources is very important, but that doesn’t mean that the advice out there about this subject is actually helpful.
Many people online tell you to start different businesses or side hustles all at once. As a highly successful property investor, I don’t recommend that approach. From my perspective, you are better off specializing and creating many complementary income streams related to your specialization. This allows you to carve out your niche, become known within it and avoid falling for shiny object syndrome, where you hop from opportunity to opportunity.
There is a way to create seven streams of income sustainably. In this article, I will give you a way to make those income streams in three simple, actionable steps. Whether they are suitable for you is for you to decide. I am not a financial adviser; that said, I am a multi-millionaire, and all this is based on my personal experience. Hopefully, you will find my experiences helpful, regardless of the path you choose for yourself.
1. Develop a business strategy to create an active income
You need a way to generate money to invest. As wages aren’t rising at the rate of inflation, I suggest doing this through a business rather than a job. This should be an actual business, not a side hustle. You will get side hustle results if you have a side hustle mindset.
On the other hand, you don’t want to quit your job before you can afford to do so with the income generated by your business. So you will need to find something that you can scale but that, in the beginning, you can do in your spare time.
You also want to find something you can eventually own without needing to work in the business. This means that there must be a way for employees or contractors to take over the work you will initially be doing yourself. This will allow you to sell the business in the future or keep it as a source of passive income and move on to a new business.
An example of this type of business in the property industry would be deal sourcing. Deal sourcing is finding property deals and then selling the information to investors. You can charge a few thousand dollars per deal. Over time, you can hire staff to take over the day-to-day and turn it into a passive income source.
2. Develop an investment strategy to create passive income
The next thing you need to do is invest your money. You need to find assets to buy that pay you to hold them. This will become your source of passive income. This will need to be a reasonably conservative, time-tested investment that will protect your money long-term. This will be your primary investment strategy, so it isn’t something that you want to be changing every month.
Never buy luxuries with your active income; that is for essentials and investing. You can use the money from your passive income source to reinvest and buy luxuries. Eventually, you can live fully off your passive income and invest all your business profits into your investment strategy and back into your business. This will place you in an excellent position to diversify into five new income streams to make the seven.
An excellent example of a property investment strategy that can generate passive income would be buying large houses and renting them out by the room. You will need to put management in place, so you don’t need to deal with tenants yourself. Once you have several houses, you may also need to hire more managers to manage your leadership and ensure the entire operation is passive.
3. Diversify based on your niche
At this point, you only have two streams of income: business and investment. Now is the time to create five more. These should be based on your industry for the most part. Don’t try and go too far outside of your area of expertise. If you’re in the cryptocurrency niche, suddenly writing a cookbook probably isn’t the right move. You want to think about ways to expand within your niche.
Some examples of this might be: writing a book about what you do and how you do it, creating a course; starting a new business that complements your existing one; angel investing in startups within your space; or buying companies you can integrate into your existing structures. If you follow this formula, I believe you can and will succeed!