10 Reasons Why We Must Have Multiple Sources of Income

In this post, I will share 10 reasons why we need to have multiple sources of income.

10 reasons why we need to have multiple sources of income

Most of us only have one source of income and mainly from employment. This can be risky, especially in this new era where things change too fast and job security is decreasing.

Here are the reasons why we need to have multiple sources of income:

1. To have financial stability

Relying on only one source of income is definitely too dangerous, especially for those with family.

What would happen if you lose this sole source of income? If this sole income is from employment, the risk is even higher. If you lose your job, it might take some time before you are able to land new employment.

But, with multiple sources of income, you will be able to reduce the risk of being left without any income.

2. To develop your skills

By having multiple sources of income, indirectly, you also learn to develop new skills. This is because each source of income comes with its own needs and requirements.

Even though sometimes, the same skills may be used across different types of sources of income.

For example, if you love to write and share your idea, you can apply your writing skills to produce a book, write articles for a magazine or compile your idea on a blog.

When you consider promoting your books online, indirectly, you are learning marketing strategies.

One thing worth taking note, if you have multiple skills, your value also increases.

3. To prepare for rainy days

Ever had an emergency and you don’t have money for it? Well, emergencies, accidents and other unexpected events won’t give us any symptoms. One thing is for sure, they require money.

For those who solely rely on one income source, it is going to be a tough time when these emergencies happen. Because you don’t have the additional fund for it.

But, with additional sources of income, you can face and overcome these situations steadily.

4. To pay off your debts faster

You can use the money from your additional sources of income to pay off your debt faster. For example, I used the money I earned from my tuition classes to pay my PTPTN study loan.

I also use the income from providing computer classes to pay for my car loan. When there is extra income for a particular month, I made an additional payment to my loan repayment.

In this way, I was able to pay off my PTPTN study loan and car loan much faster.

5. To boost your savings and grow your investment

When you are able to pay off your debt faster, you can channel the same income to boost your savings and grow your investment.

For example, you can invest the extra money from other sources of income in your preferred investment platform or retirement fund.

If you have not started your retirement saving account, you can seriously consider having one.

6. To provide additional protection

It is always a good idea to have additional protection. With the additional income, you will be able to buy additional insurance and medical coverage for yourself and your family.

Medical fees keep increasing and very unlikely they will go down. So, it is important to have sufficient medical coverage for the whole family.

7. Because you can’t put all the eggs in one basket

We have heard this many times. We can’t put all the eggs in one basket. In the same way, we can’t put all our energy and effort into one thing.

It is always wiser to put our eggs in different baskets.

For example, if we fully rely on our business as our only source of income, it definitely will be a hard time if the business failed.

Instead of just concentrating on one business, think of creative ways to add value to your business so that it will generate profits in another way.

8. To diversify your financial portfolio

When you have additional money derived from other sources of income, you can afford to have an adventure with it.

Perhaps you can try to invest in high-risk investments such as the stock market or perhaps buy some cryptocurrencies.

Starting a business is another great idea.

9. To achieve your financial freedom

I believe many of us want to achieve financial freedom, where we can have more financial flexibility in life. We wish to have control over our financial matters so that we can enjoy life instead of living from paycheck to paycheck.

Having multiple sources of income will bring you closer to achieving your financial freedom. As they said, a typical millionaire has an average of 7 sources of income.

If you want to join the millionaire club, you should really start to have multiple sources of income.

10. To have less pressure but a more fulfilled life

Needless to say, when you see money coming in from multiple sources of income, you will feel less pressure. When you are under less pressure, you will perform better in many aspects of your life.

With the additional income, you will be able to choose to do things you enjoy such as travelling or contributing to society.

Thus, you will have a more fulfilled life.

Final thoughts

In summary, having multiple sources of income not only provides us with additional cash but also adds value to our lives in many other ways.

But of course, we need to be smart to pick the right source of income, such as building a passive income.

Because we all have limited resources to involve 2 or 3 different jobs in one day. Instead of adding value to life, it will drain us and make us miserable.

I hope the above sharing brings benefits to you.

Are you currently working on multiple sources of income? Feel free to share your sources of income below.

photo credit: wuestenigel Euro Money on a White Background Close-Up via photopin (license)