It has been a rollercoaster of a year. For us all. Every one of us. I don’t think I know a single person that hasn’t been impacted by the pandemic. For me personally, it has truly highlighted the importance of working to diversify revenue streams. I’ve learnt this the hard way, but hopefully you won’t have to.
What does it mean to ‘diversify revenue streams’?
It sounds like total business jargon and I don’t doubt that that phrase has been uttered in the odd boardroom. But what it means in layman’s terms is that you need to be receiving your income from different places.
That means, if you work full time and you only get your income from your employer, then you should look to branch out.
Why is this so important?
The economy is very fragile right now. The list of ‘safe industries’ seems to be dwindling daily. And more and more people are coping with redundancy. Even if you think your job is relatively safe, do you know that for sure? If you lost your job tomorrow, then how would you pay your bills?
Learning the hard way
I’d worked at the same place for almost nine years. I had my ups and downs with the joint, but I thought my job was quite secure. Then the pandemic came along and I realised that I’d rested on my laurels for too long.
Luckily for me, as soon as I was furloughed, in March 2020, I knew that the writing could be on the wall. So I used that time to upskill. I learnt how to use Canva, I brushed up on my digital marketing skills and I launched a blog.
Then it happened, I lost my job. Thankfully, due to how I spent my time on furlough, I was in a strong position to find alternative income. But I plan to never be in the position of having a single revenue stream ever again. Because you never know what is around the corner. And actually, if you’re unhappy, working in a toxic environment, then you should have the option to walk away.
There’s nothing like finding yourself up shit creek to make yourself realise that you need to make a change. I am quite open about the fact that I spent my early twenties in debt and my late twenties trying to pay it back. I’m not ashamed of it, it happened, I dealt with it and I learnt from it. But there was no way I was going back down that road.
Think about your interests
If you want to diversify your revenue streams, then you should have a think about what interests you. For me, I loved the idea of having my own website, which I controlled, so I set up a blog (well, I set up three actually…). But for you, you might decide that you’d like to earn some extra cash as a netball umpire, or through selling crafts on Etsy.
Unless you’re very lucky, you will probably have to invest some time into a project before it becomes a revenue source. So it makes sense to spend that time doing something you enjoy.
Do your research
If you have an idea about how you can generate some extra cash and diversify your revenue streams, then you need to do some solid research. Speak to others that have done it and find out what’s realistic in terms of time and money.
Consider passive revenue streams
Passive income is something that just happens. You might have to put in some initial work, but after that, the money should come in. An example of this would be a rental property, dividends on stocks, or even receiving cashback. The beauty of a passive revenue stream is that you don’t have to exchange your time for the money. And as the old phrase goes: time is money, so having some revenue streams that are passive within your portfolio is vital.
Work smarter, not harder
Diversifying your income streams isn’t about side hustling yourself to death, working every hour that God sends. It’s about using your time well and investing it in different places.
I don’t have anything against people doing things on the side to earn extra cash. But I do think that side-hustle culture can be toxic. We should all be being paid our worth, earning what we need, within a reasonable amount of time. We shouldn’t be forced to work endless hours on top of that.
Walk away if you need to
Not all revenue streams will work for you forever. You might try something and then decide that it isn’t for you. That doesn’t make you a failure. It makes you somebody with that is open to possibilities, an individual that demonstrates tenacity and determination.
I refuse to advocate matched betting, but I know plenty of people that it’s worked for. We are all different, so you need to experiment and stick with the things that work. And gracefully walk away from the things that don’t.
Consider the pennies
Whilst I’m not going to pretend that you can finance your life by doing Prolific surveys online, you’ll be surprised about how quickly they can add up. You’d probably be shocked by how much you can generate in cashback and by the amount of free cash that you can snap up.
Somebody once said that if you “look after the pennies, then the pounds will look after themselves” and I do think there’s something in that. Little wins add up to considerable numbers.
Hedge your bets
Life is all about risk and if all of your revenue streams are coming from the same place, then perhaps its time to analyse your risk and to hedge your bets. I currently have a variety of revenue streams: a part-time job, working for my partner’s consultancy firm, freelance digital marketing services, my blog, stock dividends, online side hustles (cashback, surveys, etc). So for the first time in my life, my risk is split. I’m no longer drinking from one river.
Give it some serious thought
None of us know what is around the corner. Those profitable shares could go down the toilet tomorrow, your tenant could move out of your rental property, leaving you unable to fill it, or you could lose your job due to a global pandemic.
In order to protect your future and to guarantee your security, you should consider diversifying your revenue streams today. But make sure you do your research, because if you’re not careful, you could lose money. I’ve explained how this can happen in my article: no risk matched betting and the reasons I don’t think it exists. But you should check out my post on making free money in the UK for some genuinely simple, low-risk ways to snap up extra cash.