How to Have Multiple Streams of Income

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For many people, having a job is the full extent of their income generation. However, just having one stream of income puts us in a vulnerable situation if we lose our job. With a little bit of time, research, and sometimes upfront investment, it’s possible to create multiple streams of income and ultimately reach the goal of making money as you sleep through passive income.

There are options for everyone, whether you are looking to create multiple streams of income to decrease your risk, improve your cash flow, quit your full-time job or pay off your student loans.

So how can you create multiple streams of income?

This post contains affiliate links. If you decide to use them, my blog may earn a small commission at no additional cost to you, which helps to fund more helpful articles for you to enjoy. Find out more in my Affiliate Disclosure. Nothing in this article constitutes financial, or other, advice. These are my views and the results of years of research, testing and learning.


 

Understanding active vs passive income

Different types of income will entail differing commitments from you. Active income is typically an income source that requires your ongoing time. For example, your job may require you to be online or in an office for eight hours a day.

In contrast, passive income involves making money without requiring much effort in terms of your time or expertise, for example, the interest you receive on your investment accounts. Passive income has become popular due to books such as Rich Dad, Poor Dad, by Robert Kiyosaki.

Some experts would argue that no income is genuinely passive as you will at least need to oversee it or appoint someone to manage it on your behalf. Regardless, it’s clear that different sources of income will demand different things from you. An income source may start as active, with the initial investment of time and expertise to get it started, and then become more passive over time, such as a YouTube channel.

By combining more passive income sources alongside the money you earn from your job, it’s possible to increase the amount of money you make per year, without working 24/7.


Passive income streams

Make investments

If you have spare cash, then an easy way to start earning money without it taking up a lot of your time is to invest in funds that are managed by other businesses. Here, you may decide to work with a financial advisor who can help you to understand the types of investments that best fit:

  • your attitude to risk
  • make the most of tax-efficient investing
  • ensure you have enough variety (known as diversification) in your portfolio of investments so that you are less vulnerable to specific movements in one market or country.

Investments

Working with a financial advisor will cost you either a fixed fee or a percentage of the amount you are investing. If this isn’t something that you want to consider, then you could consider investing in an index fund with a reputable company that charges low fees, for example, Vanguard. Investing in a fund, such as the S&P 500 is less risky than investing in one individual company, as your returns come from a variety of companies; some may perform well as others struggle and you end up with an average of the companies’ performance.

Before investing in the stock market, it’s essential to understand that the value of your investments can go up and down. So, unlike a savings account, you can lose some of the money you have invested if you decide to withdraw the money while the fund is not performing well. Typically this type of investing is more suited to long-term investments of five years plus.

Depending on the type of investment you make, you could earn passive income in the following ways:

  • An increase in the value of your initial investment (although this can also reduce)
  • Dividend payments from dividend stocks

At the time of writing this article, in the UK you can earn £2,000 a year in dividends without paying tax, and you can invest up to £20,000 a year tax-free in a stocks and shares ISA, meaning that any gains you make are not subject to tax deductions.

Invest in real estate investment trusts (REITs)

Investing in property is attractive to many people, but it can require more time and cash flow than is desirable to some investors. An alternative option is to consider a real estate investment trust, managed by a team of professionals. A REIT has some similarities to a mutual fund; it brings together capital from numerous investors, giving them the potential to make money in the form of dividends from property investment, without having to purchase a property, manage it or secure a mortgage.

REITs are often publicly traded so you can buy and sell much quicker than would be the case with commercial property. Real estate investment trusts typically generate an income stream in the form of dividends rather than an increase in the value of your original investment.

You must understand how real estate investment trusts work before investing your money into one.

Get paid to use your credit card – controversial!

Numerous credit cards offer you cash back or points on your spending, which in effect is a payment for just spending as you would typically do. However, earning money from a credit card is a controversial source of passive income, with money gurus such as Dave Ramsey claiming that it leads to excessive spending and poor money habits. In contrast, many people in the FIRE community (Financial Independence Retire Early) use credit card rewards as one tool towards financial freedom.

Credit Card

Studies do show that people are predisposed to spend more on a credit card than if they pay by cash, because we feel less friction and pain in the process. If you struggle to manage your spending, then any gain you make from points or cashback will be eaten up by your overspending.

For the credit-card savvy spender, this is an easy source of extra income and reduced spending on items and experiences that you can buy with your points.

Buy a business and pay someone to run it for you

The time requirements to create an online or a physical business can be very high upfront and in the ongoing management. However, if you have a business mind that enables you to look at business opportunities and assess if they are a good investment or not, then you could buy a business. You could then outsource all of its day-to-day running, so you receive a cut of the overall profits without investing your time.

Alternatively, you could offer funding to start-ups that you see potential in, in return for a percentage of the equity in the company. Some investors choose to become actively involved in the company to ensure their investment delivers a return, while others stay silent. This type of investing can be a relatively high risk, especially if the company and its management team are unproven.

Buy a successful blog or YouTube channel

Successful blogs and YouTube channels can generate high amounts of passive income; once the content is live, it’s available for people to view and engage with on an ongoing basis. To maximise your income from an established channel, you should have someone tracking the channel’s metrics and continuing to refine it based on any new search engine optimisation requirements. You may also want to hire someone to continue to develop new content, so the channel continues to grow.


Active income streams that become passive income

The following section lists multiple income streams that all start off requiring a significant investment of time before they start to generate extra money on autopilot. Some people achieve such success in one or more of these income generation ideas that they decide to quit their day job.

Start a blog

If you decide to start a blog, you unlock the door to create multiple income streams just through this one side hustle. You’ll need to invest some time in creating a website, learning about search engine optimisation (so people can find your content), writing the content and finding ways to monetise it. Once you have everything set up, it becomes a relatively passive way of making extra money per month. You may need to need to invest a little time to keep your old content competitive in the search engines, or you could hire an SEO-savvy blogger to do that for you.

You can blog about anything that you have an interest in, and that you can make money from. For example, personal finance, home improvements, pets, hobbies, sports, fitness, nutrition, mindfulness and anything else you can think of that people are willing to spend money on.

To find out more about making money from blogging, check out my article on Tried and Tested Ways to Make Money Blogging.

Don’t have a clue to build a website to start a blog? Don’t worry; I was in exactly the same space. You can learn this for free with a starter membership from Wealthy Affiliate, which runs you through the process step by step. You can find out more in my article Learn How to Earn With Wealthy Affiliate.

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Create a YouTube channel

Similar to blogging, creating a YouTube channel opens the doors to create multiple income streams of income, including:

  • Getting paid for companies to advertise on your channel through Google Adsense (advertising relationship partner)
  • Creating sponsored videos
  • Developing courses or ebooks
  • Generating demand for your freelance, coaching or consulting services.

You’ll need to invest time in learning how to optimise your content, so more people find it on YouTube, shoot it, edit it and write the descriptions you see under all YouTube videos. However, once your video is out there, you can earn money on autopilot if you are promoting products and companies that will pay you a commission, and as you meet the criteria for paid advertising.

You can start filming just using the camera on your phone or laptop and gradually upgrade your equipment as your online business begins to earn extra money.

Having a blog and a YouTube channel on the same topic can be beneficial in terms of building a larger audience quicker and generating multiple streams of income.

YouTube

Create an online course

If you know a valuable skill that other people want to learn, then you could turn your knowledge into an online business by designing a course. A course can be a simple ebook that you create for free in a design tool such as Canva, or a more complex video and text production that you host on a specific learning platform.

It’s not a deal-breaker if you don’t have an established audience on social media who would like to buy from you. You could instead offer your course on a platform such as Skillshare or Udemy that attracts thousands of visitors each day who are looking to improve their skills and knowledge.

Once you’ve designed the online course, it could become entirely passive if you host it on a site that brings you clients, or if you establish a sales funnel with paid advertising to promote it. If you decide to promote your course through social media, then you will have an ongoing time commitment to manage your social presence unless you outsource this work.

You could increase the amount you charge for your online course if you decide to also offer individual or group coaching sessions alongside it as a source of extra support for your clients.

Affiliate marketing

Affiliate marketing involves promoting the products and services of other companies in return for a commission if you generate a sale. You can learn the basics of affiliate marketing through a free starter membership with Wealthy Affiliate.

Just make sure to pick partners and companies that offer products that you believe in and know are not scams. If you inadvertently promote a scam, this will damage your reputation and undo some of your hard work in growing a trusted online business. A safe way to get started is to promote the products and services that you have used personally and are certain work and offer a great customer experience.

Write a book

Writing a book can be a lot of hard work, but it’s a very effective way of positioning yourself as an authority on a particular topic. Even if you do not earn a lot of money through direct book sales, writing a book can be an effective way of generating business for your freelance services, coaching or consulting. A book is an impressive business card to hand to a prospective client, and will help to build trust in your expertise and experience.

Write a book

Design merchandise

If you are creative, you may enjoy designing merchandise as a way to earn money. It’s simple to do this! A free account on Canva will give you access to many design templates and design elements that you can combine and download to create a unique design that you can then upload to a merchandise printing service such as teespring.com. Once you’ve uploaded your artwork teespring will fulfil any orders for your designs and pay you a fee. You’ll need to invest some time in promoting your creations through social media or by designing a website that you drive traffic to.

Create a business and become a silent owner

A great way to free up time and earn money in return for your hard work is to sell a business you have created. You will, of course, need to weigh up the benefits of earning a lump sum now and achieving more free time, rather than having the potential for an ongoing income stream if you keep up the hard work. Alternatively, you could negotiate a deal in which the day-to-day management falls to someone else, and you maintain a certain equity stake in the company, as well as potentially some form of payment for any ongoing mentorship and support that you offer during the transition.

Invest in real estate (property)

If you are a confident investor, have money to invest, and understand the property market, then real estate can be a way to generate significant income. You can make money through property rentals, buying and renovating properties before sale, or simply holding property while it increases in value. As with stock market investing, there is a chance the value of your property could decrease, which would see you losing money if you have to sell while the market is down. That’s why it’s necessary to have some cash reserves and not to go all-in with investing, so you have a cash buffer to survive through financial downturns.

Buy property

Renting out real estate can be quite time consuming if you deal with the tenants directly. You will need to maintain the property, organise viewings, vet prospective tenants, collect rent each month and deal with their questions and requests. Alternatively you can outsource this to a property management company in return for a fee – typically around 10% of the monthly rent. You will need to understand the property market sufficiently to spot which properties are attractive rental opportunities and be financially stable enough to have sufficient cash flow to pay the rent if you don’t have a paying tenant for a period.

If your rental income exceeds the property’s mortgage and any maintenance costs, then you’ll make extra income from your rentals each month. If the rent only covers the expenses, then you will still benefit from the fact that your tenants are repaying the mortgage for you, while you would also hope the property is increasing in value.


Active income streams

Matched betting

Matched betting is one of my favourite side hustles to earn extra money in a way that is entirely risk-free, tax-free and flexible.

Matched betting differs to gambling because any bets you make, you ‘lay off’ (you place the opposite bet) on a betting exchange site such as Betfair or Smarkets. This method enables you to protect around 80% of any free bets that bookmakers offer you when you sign up and use their service on an ongoing basis. What’s more, these profits are entirely tax-free, so there’s no need to declare the income you earn from this side hustle.

Matched betting is easy to fit around a full-time job. You can place bets before or after work, and on the weekends which tend to be the most lucrative days of the week.

To get started, I recommend using a matched betting service that will train you on how to match bet successfully. Also look for one that will give you the details of all the free bet offers available today, so you don’t have to waste time scouring the internet for them.

I joined Profit Accumulator through their free trial which enabled me to learn all of the basics of matched betting and make my first £40 of tax-free profits. Based on my positive experience, I decided to join their platinum membership, which currently costs £19.99 per month or £150 per year with a 30-day money-back guarantee. So far between matched betting and the risk-free casino offers that I heard about on Profit Accumulator, I’ve generated around £5,000 all-in through tax-free profits.

 

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Matched betting is one of the best ways to earn money online without any specific skills and experience. As long as you can follow instructions and will not feel a temptation to gamble, then you can make a decent amount of money weekly. If you are consistent, you can make £1,000 a month, and some of the most successful matched betters earn up to £25,000 per year, all tax-free.

Become a freelancer

If you have built skills and experience in your job, you may be able to offer these services to other clients on the side as a freelancer. This extra income stream will protect you if you lose your job, and could ultimately lead to higher-paid opportunities than your full-time job.

Before getting started, check all of the terms of your employment contract. Make sure that you do not violate any terms and conditions within that. Typically it’s wise to avoid offering services to direct competitors of your current employer and not to use any work-provided equipment to manage your side hustle.

There are many ways to find freelance clients, including:

  • Freelancing platforms such as Fiverr, or Upwork and Bark
  • Networking events
  • Facebook groups
  • LinkedIn
  • Job boards.

Sell your services as a voice artist

If you don’t have any specific skills you think that you can monetise, think again! There is a considerable demand for voice artists to narrate audiobooks and even YouTube videos. You could get paid a flat fee for your work, or in the case of audiobooks, earn a percentage of book’s profits, which will become a passive income source over time.

Sites that you can use to find voice work include:

  • Fiverr
  • Upwork
  • ACX
  • Voices.com
  • Voice123.com

Take on a part-time job

Using investments and side hustles as ways to create multiple streams of income is not the right answer for every financial situation. Some people will feel more comfortable testing the waters initially by taking on a second job. In fact, for individuals who are in debt, this is a great way to pay off debt faster (for even more ideas on this check out How to Pay off Debt Quickly).

A part-time job may bring you more consistent work and earnings than a side hustle. If you work as a part-time employee, you also avoid the challenge of having to complete a tax return for any money that you earn because you are not working on a self-employed basis.


Conclusion: creating multiple streams of income is a great way to provide extra security and make money

There are so many options for multiple streams of income, and it can be challenging to know where to start.

The following questions help people to decide which options from all the ones to choose from, are right for them:

  • How much time do you have to dedicate to generating additional sources of income?
  • How much money do you have available to invest in generating passive income (if any)? Do you have debts to repay first?
  • What skills and experience do you have that you can monetise?
  • What ways of generating income appeal to you and which ones do you think you could commit to spending a set amount of time on per month?

The people who tend to be the most successful at generating multiple ways to make money are typically the people who stick to one or two things until they see results, and then stack on the next way to make an extra income from a foundation of success.


Frequently Asked Questions

How much money should people aim to make per year?

One way to motivate yourself with a side hustle, a second job or investing is to set a financial goal that inspires you to take action each day. Your goal could be to:

  • Pay off your debts by a specific date
  • Become financially free in a set number of years
  • Save the money to put down a deposit on a house, buy a car for cash or fund your education.

Some of us find it motivating to turn that financial goal into a vision board that you display in your house to encourage you each day.

If your goal is to become financially free and have the option to retire early, then it can be challenging to know how to calculate how much money you need to invest today to make it happen. One tool that I find very helpful is Chris Hogan’s R:IQ tool. By answering a few simple questions, it will give you an indication of how much you need to invest today to reach financial freedom by a specific date.

While none of us has all the answers on what stock markets will do tomorrow or during the next year, there is a lot of data we can use to inform our long-term financial planning.

How many income streams should I aim for?

If you want to create multiple streams of income, no one can tell which ones are right for you, and how many you need. That all depends on what your personal finance goals are, how much time you are able and willing to dedicate to different ways to make money, and whether you have some money available to invest.

Many people start their journey by creating a side hustle alongside their job, which sometimes turns into a business. You’ll find some great ideas for side hustles in this article, and you can also read my article on the Best Side Hustles for inspiration. You can then use the extra cash to pay off your consumer debts and then start investing. If you’re not sure what steps to follow with your finances then Dave Ramsey’s baby steps are a great place to start:

  1. Start an emergency fund and save up $1000. If you’re from the UK, then you can round this to £1,000.
  2. Pay off all of your debt apart from your mortgage through the debt snowball method (you can read about this method in our article What is Debt Snowball?). In the UK, some people decide not to include their student loan debt at this stage because the student funding system is less expensive than the US model.
  3. Save three to six months of household expenses in an easily accessible savings account to protect you in case you are unable to work.
  4. Save 15% of your household income for retirement – this includes any contributions you and your employer make to a pension scheme.
  5. Save for your child’s education (In the UK, the student loan system is less expensive than the US model, so some families decide not to contribute).
  6. Pay off your mortgage early.
  7. Build your wealth and give to others.

Dave recommends that you combine steps four to six, so you make progress in all three at the same time.

Regardless of where you are with your financial plan, multiple sources of income will give you more security as you are less reliant on any one way to generate income.

What are the best passive income ideas?

If you are not in debt, and you have money available to invest, then many people decide to invest their money in index funds or exchange-traded funds (ETFs). These funds provide the benefits of investing in many companies. Over the longer-term, you’ll hopefully either receive payouts in the form of dividends or growth in the original value of your investment. As these funds do not require you to manage them actively, they are a form of passive income. In the UK, certain funds that are structured as a stocks and shares ISA attract tax-free earnings up to specific limits each year.

You’ll see some more passive income ideas in the article above (check out the table of contents) and in my article Best Passive Income Ideas.

It’s sensible to consider all of your options before getting started. The people who succeed with passive income are typically the people who have a long-term mindset and stick with one or two things until they see results, before trying something else.

How much of an expert do I need to be to create an online course?

If you are considering writing and launching an online course as a business, all you need to be sure of is that there is someone in the world who will learn at least one important thing from all the things you would like to teach. It can be nerve-wracking for business owners to get started and be visible in promoting their course, but the reality is that you can’t help someone unless you share your knowledge.

One way to build your confidence is to start with a shorter course that you offer at a lower price point and steadily add to this and increase the price over time as you see the results each member of your course achieves and the feedback they provide. Your pricing should reflect the value your customer will receive from your teaching.


What experiences have you had with building multiple streams of income?

Have you achieved success building multiple ways to generate income?

Out of all the side hustle options, which one is your favourite?

What advice do you have for someone who is looking to earn some extra cash alongside a full-time job?

We’d love to hear from you in the comments below!

 

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2 thoughts on “How to Have Multiple Streams of Income”

  1. Wow that’s a very comprehensive list Emma
    I would avoid the credit card route as the risk is you spend unwisely on things
    Paying off debts if you can do so is well worth it. I recently saved over £1,600 by paying off a car purchase deal early. There’s no point having savings aside earning a pittance of 0.3 to 0.5% interest when you are being charged 5.9% interest rate. Paying off early included a £780 rebate but this is not always the case. When a friend of ours looked at paying off early the interest saving offered was only £405 whereas I worked out it should have been £620. So challenge any offers
    My only concern with on line teaching etc is how can you protect your intellectual property? I find it very annoying that several papers I wrote in the 1990’s for the company I worked for are now available for download for a charge. They may be my ideas but the intellectual property belongs to the company who took over our old company
    The web has organisations selling on what is not theirs to sell

    Reply
    • Thanks for taking the time to share your thoughts Derek! Yes, many people share your opinion with rewards for credit card spending.

      Congratulations on paying off your car finance! You make a really important point on always looking at the details and calculating the hard numbers.

      In terms of intellectual property, you have more protection where you create content on a self-employed basis. Typically as an employee, your employment contract assigns all intellectual property rights to your employer.

      Reply

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