Nothing beats this wealth-building strategy. This is the ultimate secret of the super rich. Most people end up struggling to work on ONE stream of income by having a job. But the rich don’t operate that way. They work towards developing a personal system wherein work is done once and then the money keeps flowing in. Ah..the beauty of residual or recurring multiple streams of income.
So how exactly do we do that?
1. Work religiously to generate Cash-flow : Cash-flow is everything and you are now at a stage wherein you will need to put in the effort to generate it. Get a job or multiple jobs to start generating the cash flow. Give yourself a time — like a year; two or three and work furiously until then. No fun. Just work. Why? You got a lot more things to do; your goals are different and you will be surprised to see that most of the others will think you are crazy, among other things. Now this cash isn’t for weekend parties and mindless spending — it is to be saved. This is what is called “precious money”.
2. Invest in something that doesn’t involve your presence : Most commonly, the rich look at real-estate as n option because it is indeed a one time investment and you would lease it out for tenants who would use it for a monthly fee. See? That starts your second income stream. However, there is just one problem. The costs of owning a piece of real estate is outrageously expensive. We should be doing this much later, when you have a lot more dough to play with. So what’s the other option? Well, there are many but since we are still at a growing stage and don’t really have too much cash lying around. We should be looking to Invest. This earlier Guide on Investing makes for a good read if you need to know a little about it. This is a case where your cash will start working for you. The dividends or the returns coming out of the market returns is to be your second stream of income.
3. Start a part-time Business : Start doing moonlighting or start a business ( you still have the job that can keep things going for you!). We do this to achieve two things — one to give you a taste of things to come and two, because if you do it right, you will generate more cash flow simply because you earn as much as you work ( unlike in a job). You will continue doing this until you are working away into the nights; earning substantial amounts of money and almost getting there — but you aren’t yet. The cash-flow here should be your third source of income.
4. Full-time Business will find a way on its own : Once you get started on your part time business and develop enough client, you will begin to realize the need to have additional help to manage some of this work or to do things you might not be good at, like accounting. You will hire your first employee and then scale up from there depending on your pace of growth. You will free your time now to an extent and you will do well if you focus this time on getting more clients while you hire someone else to do the delivery. You are now slowing evolving into a business. Let’s say you are still on the third source of income. You will let go of your job at this stage.
5. Leverage : Here’s where it begins to make sense. Slowly your employees will start working for you and you can slowly build a team of people who will across the functions of operations, delivery, sales and marketing ( although you contributed a lot here) and accounting/finance. When you do develop systems and ensure that things seem to be working without your involvement, you are getting there. Leverage is what makes businesses powerful. leverage is the tool of the rich.
6. Idle you, active Money : Your business is taken care of ; that’s your first source of income now. You have been saving money every month, haven’t you? That’s your second source of income. After a certain time, you will be making a lot of money which you can now use to build assets like homes, ranches, commercial buildings and lease them out – this will be your third source of income. This will fetch you more and more dough — this is your playground bubba! Do what you like!
That would be an ideal blueprint for building a system for multiple streams of income. How quickly you will get here is a function of how well you put this into practice and whether you will persevere or not.