I’ve rather lost my way with side hustle diversification and side hustles in general. Our first business has taken over our lives at the moment and that’s a good thing.
Its easy to put all the proverbial eggs in the basket and keep working away in the trenches to make that one thing profitable. The importance of side hustle diversification should never be overlooked though. Think of all the big Financial Independence bloggers who make money the traditional way through investments. They diversify, spreading risk, increasing gain – the smart way. The same importance should be placed on any form of income stream.
The Advantages of of Side Hustle Diversification
Having multiple income streams provides a safety net if one of the streams fails one month or fails completely. I aspire to become a serial entrepreneur so having multiple income streams will allow me to explore new business ideas. I can set up multiple businesses without the fear of not being able to eat next month.
Job security doesn’t exist.
We all grow up with the notion that once we are employed in the rat race, we are set with a job for life. This simply is no longer true. The scale is constantly tipped away from security and satisfaction. It is now weighted with long hours without additional pay and bosses cashing in on their employees fear of losing their job. Also what happens if your unable to remain in your day job due to personal circumstances and ill health?
Savings for the future remain where you put them
Extra income streams mean your no longer dipping into your savings when life little emergencies pop up. I often feel like our saving account has a hole in it since all the money we put in seems to fall back out again! Once you have established additional sources of income, savings can be moved into more profitable accounts or investments safe in the knowledge your diversification has your back.
The disadvantages of Side Hustle Diversification
Not knowing where to start.
Yes that’s a real thing. Ever searched the internet for ways to make money? An assault of online surveys, babysitting and selling your old stuff follows. Sure they are all genuine ways of making money (how much you make is questionable though) but they all fall into the same income stream, in my humble opinion.
Becoming afraid of the unknown.
I know nothing about investing. Its true. Does it scare me? Only if I was putting my money into it with zero research. Don’t do things lightly. Most of us are afraid of putting cash into something we don’t understand, so don’t so it. Understand it first. Find out how to do it, google it, read about it, talk to the experts about it. Then decide if its right for you. Just because Mr Money Moustache retired at 30 by stashing his cash primarily in market index funds doesn’t mean you should too.
So where does this leave my income diversification? A matter requiring urgent attention. I have some blueprints for the variety of income streams that all FI strivers should be adhering too. They need some more review and research. I’m hoping to share them next month.
How do you diversify your streams of income?