According to the American Psychological Association, more than seven in ten Americans have admitted to being stressed about money. Over the past year, many people experienced worries and anxiety about money due to the pandemic, job layoffs, and other disruptions.
The pandemic has changed how people work and how they make a living. Some folks who lost their jobs had to turn to extra income sources, loans from loved ones, credit cards, etc.
A lack of money and income can lead to all kinds of stress, namely financial, mental, and emotional stress. Online tests are an awesome mental health resource for anyone who is having a tough time. With that being said, the past year is a prime example of why multiple income streams are so paramount.
Why You Should Have Multiple Streams Of Income
When it comes to income, it is always better to have multiple streams that you don’t need than to need multiple streams that you don’t have. Keep following along to learn why having multiple income streams is so important.
More Money to Save
It is a given that a percentage of your income will go towards bills and other living expenses. When you have one income stream, it can seem like your money is gone almost as soon as you earn it; however, with multiple streams of income, you’re in a better position to put aside money for a rainy day.
Even if you are doing well financially with just one income stream, it never hurts to pursue other earning avenues. You never know when an emergency or unexpected expense may pop up. It is during times such as this that the money you saved will ultimately save you.
More Money to Invest
It is often said that the rich don’t work for money, but instead make money work for them. One great way that the rich make money work for them is by investing; however, investments that are profitable later down the line require the necessary seed money to get the ball rolling.
When you have multiple streams of income, investing becomes much less challenging. By wisely investing a percentage of your money, you can grow the funds and reap the monetary benefits later down the line. The amount of money to invest will all depend on your earnings, financial situation, the opportunity at hand, etc.; however, multiple streams of income are what ultimately makes investing possible.
More Skills in Your Arsenal
To some extent, creating multiple income streams involves some level of skills. Having various skill sets in your arsenal is always advisable. This is especially important when you take into account the fact that you’ll be competing with others in whatever market(s) you use to diversify your income streams.
Another benefit to having multiple skills is opening yourself up to various opportunities. You never know what possibilities could present themselves to you later down the line when you’re in the best position to receive them. When it comes to finances and earning money, skills that you can market and profit from are your best friends.
Easier Time Paying Off Debts
In this day and age, many adults have incurred debt in some form. Now, debt — and the subsequent interest fees — can be tough to pay off with just one stream of income arriving on a regular basis.
When you have multiple income streams, though, you have significantly more money that you can use to pay off debts. A debt-free lifestyle is a goal that so many people have, yet struggle to attain. If this sounds familiar, then setting up multiple income streams can certainly improve your life and your financial situation.
Less Reliance Upon Credit
Many adults find themselves relying on the use of credit cards to make necessary purchases in their lives. In and of itself, this isn’t bad; however, reliance upon credit cards is problematic for people who cannot afford to pay off their balance by the due date. This is how debt begins and rapidly accumulates.
Multiple streams of income provide an alternative to reliance upon credit. Being able to pay for expenses with cash or debit lets you keep more of your money by not having to pay any interest. Having multiple income streams doesn’t mean that you should never use your credit cards again; it simply means that you have the option of not using credit and still being able to make necessary and/or wanted purchases.
Stronger Ability to Deal with Rising Prices
It is a fact of life that the prices of certain goods and services will rise at one point or another. Being financially prepared for prices that may go up is imperative to living a comfortable lifestyle and meeting all of your economic obligations.
Having multiple income streams means having more funds at your disposal. If push comes to shove, these extra funds will come in handy when prices go up. Being prepared is always so important, especially when it comes to money. As prices ebb and flow, the time may also arise when certain modifications to your budget are necessary; it is times like this when having multiple income streams available to you will be of value and of benefit.
Access to a Creative Outlet
While there are many financial motives and reasons to obtain multiple income streams, the creativity factor is also another benefit. Many people who seek fulfilment in life find that monetizing their passions (whether it’s setting up a small shop, earning income from a blog, etc.) gives them a healthy and much needed creative outlet.
Finding a way to monetize your passions lets you reap all of the economic upsides of multiple income streams while also achieving personal satisfaction. It is often said that people who do what they love will never truly work a day in their lives. This is an important principle to remember, especially while in the process of setting up multiple income streams.
There is no doubt that having multiple income streams requires time, skill, and patience. However, if you stay the course and remain committed to diversifying your income, the benefits will greatly improve your finances and quality of life.