This article was created in partnership with Western Union.
Gone are the days of having one job for life. Job security is increasingly becoming a case of not placing all your eggs in one basket. By having multiple streams of income, you have a backup plan in place should one stream fail. Diversity here is now key.
That said, with the digital revolution and rise of the sharing and gig economies, building multiple streams of income has never been easier. Here’s how to get started.
Explore income stream options
Outside of the regular 9-to-5 job, there’s an array of opportunities available to boost your bank balance and ensure future financial security. Popular options include:
1. Investing
Investing your hard-earned cash is one way to keep it earning for you. Depending on the amount you have available and your circumstances and appetite for risk, consider the following ideas:
- Term deposit: Lock away your money for a set time and be rewarded with a guaranteed higher interest return.
- Exchange traded funds (ETFs): This is a type of managed fund that can be bought and sold on a securities exchange market. This is a simple and low-cost way to get investment returns, but ETFs can range in complexity, and some are riskier than others.
- Shares: This investment makes you part owner of a business, with potential income from dividends and also capital gains. ASX offers a tutorial if you’re new to the share market. Keep in mind, there’s always the risk of share prices plummeting.
With any type of investment, the Australian Securities & Investment Commission recommends you plan, research and understand how your investments fit with your financial goals. You should also read up on different types of scams.
2. Freelancing
A side hustle can offer flexibility and the opportunity to develop new skills and follow your interests. So, as you might expect, freelancing is a popular way to create another income stream in today’s market. Research from The AMP Foundation suggests as many as two in three Australians now have a side project they hope to turn into an income stream.
Software development, accounting, translation, design and social media management are all popular freelance gigs. When exploring ideas, think about your existing skill set, what you enjoy doing, your goals, which jobs and skills are in demand and the profitability of the niche you’re drawn to.
Next, you’ll need to find clients and start marketing yourself. Freelance platforms, such as Fiverr and Upwork, along with industry-specific platforms, abound. However, there are plenty of other ways to find quality work in a less competitive arena. You can reach out to your work and personal connections, spread the word on social media, invest in a website optimised for search engines and network with other freelancers who may be overloaded with work.
3. Sharing
Do you have a spare room that just sits there? Or, perhaps you’re lucky enough to have a holiday house that you escape to some weekends? What about those fancy threads you paid many, many dollars for that now sit in your cupboard?
Sharing is caring, so they say, but these days, sharing is also earning. Digital technology has enabled platforms that match people looking to hire things with people who are willing to hire out their things — for a price, of course. In Australia, recent statistics from Flatmates.com show that you can earn an average weekly amount of $197 by letting out a spare room.
There are numerous other digital technology platforms today that can help you connect and share, however you need. For instance, if you’re looking to support family overseas or sending money abroad, consider mobile solutions like the Western Union® app.
Decide what best suits your lifestyle
Time, money and risk are going to be the three key factors guiding your decisions when creating multiple income streams.
Work out how much time you have available each week to devote to the plan. Also, consider how willing you are to sacrifice this time. Starting a blog, for example, requires little capital investment but building it into a business is likely going to take a lot of time and energy. Using an existing skill like accounting, on the other hand, can see you earning an hourly rate within minutes of setting up a profile on a job-sharing platform.
If you have more money than time, a more passive income stream such as investing in shares is an attractive option. The amount of risk involved in various investments varies dramatically. If you’re investing, spend some time thinking about whether you can tolerate the ups and downs of the share market or if the security of a term deposit is what you’re after.
You’ll also need to consider start-up costs, associated expenses and tax implications of the options you’re considering.
All things considered, exploring and creating new incomes streams can bring more than immediate financial benefits. It could be a truly life-changing experience as you learn new skills, follow your interests and create a deep sense of personal satisfaction and financial security.
