How Multiple Streams of Income Lead to a Flood of Wealth Comments26 Comments

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For most of life, I thought that I would graduate college, get a job and work until 65 years old. I thought that if I played my cards right and was smart with my money, I would be able to retire maybe by 60. But after I graduated from college, I realized that I didn’t want to work at a 9-5 job for 40-plus years of my life. I wanted to be able to do what I wanted and still generate an income.

Single Stream of Income

Many of us have one source of income during our adult lives: our job. If we were to lose our job, the source of our money dries up. Many people refer to this source of income as an income stream. With me being a professionally trained artist, I’ve created what this income stream looks like below.

Income Stream

As you can see, the income from your job is your sole source of income, or the river in the above masterpiece. The problem is that if there is a drought, the river dries up. Same thing if you lose your job – your sole source of income dries up.

For most people, it’s not until we hit retirement age where we actually take advantage of more than one source of income. Retirees collect Social Security and they also live off of their investments. Some might even work a part-time job during retirement just to stay active, while others may benefit from a pension. Below is what this looks like.

Income Stream

Here we have two additional streams of income. As such, we have smaller streams feeding the main source of income. In this example, Social Security would be the main source of income, while investments and a part-time job would be the smaller streams. While it doesn’t appear to the naked eye to be making a difference, the additional income streams do make a difference. If one of our streams were to dry up, we still have other streams of income providing for us.

Creating Multiple Streams of Income Earlier

Getting back to my story of not wanting to work a 9-5 job my entire life, I realized that having a sole source of income would not cut it. If I only lived off of one source of income, my job, I would get to retire, but not as quickly as I want to. After all, when you think about it, most people retire once they can afford to do so. They have that one stream of income that, if they were financially smart, they could afford to retire in their 60′s or 70′s.

If on the other hand, they added additional streams of income, they could afford to retire earlier. This is the route I am taking. As you can see in my final masterpiece below, I have many additional streams of income. My job is currently my main source of income, however, I have additional streams as well:

Income Stream

Some of these streams are just that, a stream. But others are smaller rivers. All of them feed into the main river of income, which causes it to swell and grow in size.

Being Smart About Streams

You might think that I could do anything to provide additional income streams. When I first started adding streams I thought the same thing. But I quickly realized that this isn’t the case. Some streams aren’t worth the effort in sustaining them; they are just created quickly, like from a downpour of rain.

You need streams that are worth your effort and time. I was focusing on a new stream a few months ago that was providing me a decent amount of money. But when I took a step back I realized that if I focused more on a few of the streams I already established, I could quickly grow them to be twice their current size. That stream would be bigger than the new stream ever would be.

Final Thoughts

When you do what the majority of other people do, you are going to have roughly the same result. People who are smart with their money and rely on their job as their sole source of income tend to retire in their mid-to-late 60′s. People that are smart with their money and have additional sources of income on top of their job provides the opportunity for them to retire sooner.

I want to retire sooner rather than later. As a result, I am focusing on creating many streams of income so if I were to quit my job, they would still be able to provide a river’s worth of income. It’s not easy and I need to be smart about what activities I choose. But if I stick with it and choose wisely, I am certain I will get to where I want to go.

Readers, do you have multiple streams of income? Why or why not?

Author Bio: Jon writes for MoneySmartGuides, a personal finance blog that helps educate people on personal finance so that they can reach their financial dreams. He focuses mainly on investing and paying off debt since those are the two of the most challenging personal finance topics we face.

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By : Jeremy Biberdorf | 28 Nov 2013
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26 thoughts on “How Multiple Streams of Income Lead to a Flood of Wealth

  1. Dee @ Color Me Frugal

    Great post! My sentiments exactly. The hubs and I are working hard to develop our multiple streams of income- right now it’s just investments and rental properties but we are looking to expand via blogging and other ventures. Best of luck to you on your early retirement journey!

  2. Alicia @ Financial Diffraction

    I definitely agree. I currently have my main income, a teensy bit of investment income (paying down debt is my current focus), and a rental property. In the future I would live blogging yo be a stream of income, and also have my investments grow much larger. That is a nice four-part stream, fairly similar to yours.

  3. Wealth Tortoise

    It’s a very effective analogy to use the term streams of income, as they all flow into the river of what you make in total. The more streams you have, no matter the size, the more options you have should others dry up, especially the main one! I think this mindset you talk about is essential for people to cultivate as we head into the future, as a form of financial self-protection against the elements.

    1. Jon @ MoneySmartGuides

      Agree 100%. I knew that just one source of income wasn’t going to get me to where I want to be or what I want out of life. That isn’t to say I want mansions and cars. I want the freedom to work if I want to. Having multiple streams of income brings me that opportunity.

  4. Hayley @ A Disease Called Debt

    I’m always looking for ways to start up new income streams. I have a property which I rent out, I blog and have tried a few other ventures which have failed unfortunately! I think multiple income streams is definitely the way forward and hope to find some that suit me and which I can make work.

  5. dojo

    This is always something to have in mind. My main income comes from my web design business. But I do also own few sites that get me advertising revenue. Sure, it’s not that much, but few hundred bucks now and then won’t hurt. I’m now working on building a ‘shop’ with premium logos/designs, which should also get me some money.

  6. Kay

    Great post! And I like the graphics! Yes, always helpful to read about how others are creating multiple income streams. We don’t have rental property, though it is something I would like to invest in in the future. Right now I’m focusing on growing my investments in dividend paying stocks as that is my plan for passive income in the future.

  7. GetRichWithMe

    Its such a great shame that personal finance and simple concepts such as multiple streams of income were never on the curriculum when i was at school, and still isnt now.
    Its so simple and makes so much sense.

  8. Tushar @ Everything Finance

    I don’t have a flood of wealth yet, though it certainly will be nice when I can say that I do. I have multiple income streams and hope to continue to evolve my income portfolio. You’re right, it’s the best way to ensure you are financially sound.

  9. Money Saving

    Great post! I’m working on searching for those elusive streams that I can grow bigger. Right now, they’re just little creeks :-)

    I currently have my main job, blogging, investment dividends, programming (, and I’m working on eBay reselling. It’s tough for me to get my ebay work about $25 an hour though. I’ll keep trying until I hit on something :-)

  10. Paul @ The Frugal Toad

    Well written post Jon! While multiple income streams are important in building wealth, you need to be careful when deciding where to grow your money. Many investors have lost their investments in rental properties and if you have no experience it is best to consult with an expert before committing your hard earned money.

  11. Jonathan @

    Nice post Jon. Multiple streams of income is one of the ‘secrets’ of the wealthy. Although retirement isn’t necessarily the number one goal – some of us like working! Reducing the risk of relying too much on one income stream is just as important as you mentioned. Good luck in your quest!

  12. Sue @ When Did It Get So Complicated

    I agree that multiple streams of income is the way to go to early retirement. I started with rental properties and direct sales and was able to semi-retire before 40. Now I’m working on adding informational products to the list.

    I’m planning to start a meetup group or something similar in my area with a group of like minded people. I’d love to hear if anyone else has done that if it was successful.

    Great Post!

  13. Jaafar

    These are great tips. I am looking into other means of income. Seriously thinking about blogging for the past couple of months. I just don’t know how I would do that full time since I already have a full time job. I gotta sleep too you know. :S Oh well, we’ll see. Thanks for sharing.

  14. Jack @ Enwealthen

    The hardest part about creating multiple streams of income is putting in the time to build them.

    + Writing an ebook is easy. Marketing it to success is hard.

    + Creating a blog is easy. Maintaining a successful, profitable blog is time consuming.

    + Investing in rental real estate is straightforward. Earning the down payment and dealing with tenants is a challenge.

    So while I agree with the premise, and pursue it wholeheartedly myself, it does get wearying listening to so many people online who say how easy it is. If it were easy, everyone would be doing it. It’s hard, but we’re all still here plugging away at it, because the reward once you achieve it, is worth the effort.

    But it’s an effort!


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