If you missed them, read the first four parts of this series here.
We’ve talked about many things in this series, but if there was one thing that has changed our income status, it would be what I’m going to talk about today. Not only has this principle transformed our mindset, it has also multiplied our income substantially.
What’s the principle?
4) Diversify your income
I first heard of the concept of income diversification when I was also learning about residual income. Since that time, we’ve experimented with numerous income stream ideas. Most of them have flopped royally on their face. However, some have been moderately successful and a few have been wildly successful.
The concept of diversifying your income is basically to set up various income-producing sources, instead of putting all your eggs into one basket and expecting that basket to be your sole source of sustenance.
We realized the beauty of income diversification when Jesse was unemployed back when we lived in Kansas City. Since I had spent the last two years experimenting with ways to earn money from home, we had a cushion to fall back on. It wasn’t a very soft cushion, but at least it kept us from crashing and burning.
If you lost your job tomorrow, would you have something to immediately fall back on?
Even if your employment is very secure, it’s always a good thing to prepare for the unexpected. Plus, even if you never lose your job, having secondary sources of income in place will allow you to save more aggressively toward your financial goals, give more generously, and/or just have more wiggle room in your budget.
When people ask me how I make money blogging, most of the time they are quite taken aback when I say, “It’s the power of multiple streams of income.” My blog earns a significant amount of money every month, but it comes in through dozens of different checks and electronic transfers from dozens of companies. Some of the checks (such as those from my sidebar advertising) are routinely much higher than what I’d make off of promoting something like CashCrate, but each check brings in a trickle that turns into a strong stream of steady income to pay my team, my blog expenses, and to have leftover as personal income.
In blogging–and in most businesses–things ebb and flow. Certain things will do really well at certain times of the year. At other times, that income stream doesn’t do so well. If I were to just rely on sidebar advertising or one affiliate program for all of my blogging income, it would be a lot lower than it is. But because I have multiple streams of income in place, the ebbs and flows help balance each other out so that the income is fairly consistent.
When you understand and implement income diversification in your lives, not only does it allow you to often significantly increase your income, in experimenting, you’ll probably discover a number of different income-earning ideas that will give you a very good return on your investment of time.
How do you set up multiple streams of income? We’ll talk about that next Wednesday. Stay tuned!
Do you have multiple streams of income in place? If so, I’d love to hear what has and hasn’t worked for you.
TPJ says
Hi Crystal, I was waiting all week for a new post in this series? I hope this is not the last tip!
You are doing a great job educating so many! Good luck!
Crystal says
The next post got bumped to next Wednesday because of some things that came up this week. Thanks for your patience and excitement about this series!
Emily says
This series has been excellent and I can’t wait to learn more! What books or websites or other resources would you recommend for learning about residual income?
Angela says
I do a lot of reviews lately, but I only accept a few of the opportunities. My inbox is a mess! I’d say it took a few months before I started getting offers.
That’s why I recommend writing about what you really like because the offers were directly related to what I was writing about.
If you dig through my blog posts, and look at the bottoms of my posts, most of them will say “who” I was writing for. A lot of them are companies that keep a list of bloggers and alert you when there are review opportunities. You can always sign up for them (they are all free – I do not work with any companies that require me to pay anything) and you will get random “jobs” from each of them.
I like to consider my blog a health/fitness/gardening blog, but I do get so many review opps that it turns into a lot of reviews. When I write about what I want to write, it’s usually gardening/fitness/recipe related.
Hope that answers your questions. 🙂
Tiffany says
Crystal, I have really liked this series, I hope you continue to write it. I have found the most useful information from the comments of other readers since they are very specific as to what they are doing and you tend to be a little more generalized. It would be great if you did a post on ’50 Income Stream Ideas’ using some of the ideas here and some of those you’ve learned.
Angela says
Thanks for this series. I’m always looking to add multiple streams of income and recently found that so many of my neighbors are willing to pay me to do the things I do for my own home as a SAHM – like declutter (sort through their stuff for goodwill etc), prune their shrubs, take their dogs for walks, let-in dishwasher repair guys, etc.
It’s starting small but word of mouth has helped. To any of you that are new at blogging, stick with it. I started my blog about 2 years ago and after 6 months, I was making a steady ($300+/month). Then I slowed down my writing and maybe blog a few times a week and I am consistently making about $600/month.
I write a lot of paid (sponsored) posts. Some of them contact me directly but most offers come through networks I work with. I’ve wrote about some of the ways my blog makes money (here’s one example: http://thesuburbanjungle.blogspot.com/2011/03/blogging-for-profit-fastest-easiest-way.html)
My biggest piece of advice – write about things you are passionate about. Most of my offers come as a result of things I have written and people approach me to write on similar topics. So if you write about things you are only sorta interested in, you might get offers that aren’t very interesting.
The second best advice for getting your blog up and running is to visit other blogs and make friends online. People are amazingly supportive and willing to help.
In addition to making money blogging, I am open to blog reviews so I often get to try and keep new products. Trying new things saves money on buying. 🙂 Plus it’s fun.
I’m willing to answer any questions about “part-time” blogging if you have any. I’ve been pretty fortunate and it really doesn’t take a lot from my family time. I only blog at night or when my kids are at school.
Good luck everyone!
Tiffany says
Hi Angela,
I looked through your blog and it looks like the majority of your recent postings are reviews. Do you consider your blog a ‘review’ blog? How much traffic did you have before you were able to do sponsored reviews?
Thank you!
Angela says
I do a lot of reviews lately, but I only accept a few of the opportunities. My inbox is a mess! I’d say it took a few months before I started getting offers.
That’s why I recommend writing about what you really like because the offers were directly related to what I was writing about.
If you dig through my blog posts, and look at the bottoms of my posts, most of them will say “who” I was writing for. A lot of them are companies that keep a list of bloggers and alert you when there are review opportunities. You can always sign up for them (they are all free – I do not work with any companies that require me to pay anything) and you will get random “jobs” from each of them.
I like to consider my blog a health/fitness/gardening blog, but I do get so many review opps that it turns into a lot of reviews. When I write about what I want to write, it’s usually gardening/fitness/recipe related.
Hope that answers your questions.
Brenda Prentice says
Thank you. For someone (me) who is always scared of failing and never wants to start anything (because it’ll just flop anyway), this was WAY encouraging.
Crystal says
You are so welcome! I believe no one is ever successful without experiencing quite a bit of failure. We just tend to forget the failures in light of their amazing successes! I’m rooting for you!
Brenda Prentice says
Thanks, Crystal. You’re rooting is more encouragement than you probably know.
Melissa says
I’ve been reading your posts about making money off blogs. I’m curious, I started mine just for the fun of it. Have any of you started your blog just for fun, and it ended up being a money maker?
Kelsey says
My husband works full time but does countless free lance writing in the evenings and has written 2 books. I am SAHM and teach piano 2 days a week, babysit occasionally and run a side suppliment business. We have enjoyed your content on this blog about multiple streams of income and are looking for more ways to do that.
Lisa says
As a child of the first college-student-credit-card generation (this is to say I’m 50) I’ve done everything financial wrong at least twice. Not proud, just stupid for many years. Dave Ramsey has helped me tremendously, but so to was being sick of always being broke, always begging a $10 loan. How obnoxious can you be? Yep, been there. Recently, at about the 23 1/2 hour before retirement, I’ve gotten series. Reduced everything possible to the bare bones (no tv, no internet at home, no eating out no no no. ) I have my first ever emergency fund. My retirement savings are appropriate to a 19 year old but at least I’ve taken that step (Previous 401(K) was used up during unemployment). This series is fueling my efforts to find additional “trickles” of income that may some day combine to form a “stream” of extra income to put towards retirement. Thanks for posting this and for so many other great posts.
Jane says
Yes, I love this! I was inspired by this post today to set up a small Etsy site in addition to my other side-hustles. Not sure what will come of that, if anything, but the investment of about 1 hour and $5 seemed worthwhile to me! Thanks for the inspiration.
Cathy @ BudgetingForChristmas says
I’m thinking of doing that too! Any little income here and there helps!
Jennifer says
We have my husband’s main income, we have my income (PT), we have my husband’s side job income, we have my blog income, we have my ad income from writing, we have income from walking the dogs for my neighbors, etc. I love have multiple sources of income. What helps is that we rely on only my husband’s main income to cover our monthly expenses. Everything else helps in other ways – like to pay for braces for my son, or to purchase a new car, etc.
Kim @Going Thrifty says
Thanks so much for this series Crystal! My blog is only a little over 2 months old and I was VERY intentional in following your “How to Make Money Blogging” Series as well as http:www.bloggingwithAmy and her tutorials in building a blog from the ground up.
Thankfully, I have seen what I consider a great return after just 2 months. (ie: close to 4 digits) I tend to be very “compartmentalized” and can focus extremely well on one aspect at a time. That is why this “multiple streams” mindset and practice is such a challenge for me. Interestingly enough, even as a newbie I can see the value in it. For instance, although my site numbers increased in month#2, my dollars did not. In fact, they were about $100 less with one affiliate although my focus, posting, etc, etc, did not deviate.
I’m wondering (and others may be as well) if you could address what a “down” month might look like with an unnamed affiliate, even though your posting resumed as normal. Obvioulsy, don’t use hard numbers but perhaps a percentage. Because like you said, it ebbs and flows. Just by you mentioning that in your post gave me encouragement as it helps to see the decrease in a month with a particular affiliate happens to everyone.
But the end of this long reply is that I am challenged to focus more on the multiple streams. Thank you for sharing!
Sara says
My cousin is a perfect example of diversifying income- I’ve learned a lot from her. Her day job is as a child court advocate.
Sidebar: She is the bravest, most compassionate human being I know. The tenacity and resilience it takes for her to help these children, in circumstances too awful to name, is immense.
Anyway- She also adjuncts for 1-2 classes a semester at a local college. Her husband is a full-time electrician. Before they married, he managed several rental properties, which they continue to do. My cousin also got her real estate license. Now, her husband was recently laid off, but because they have other income streams, they can focus on other projects while he continues his education.
Granted, their route was diversifying outside the home, which isn’t for everyone, but it still has given them a cushion and taken a lot of the sting out of the lay off.
Cathy @ BudgetingForChristmas says
Thanks so much for this series, I just started a new blog and it can be really overwhelming at times! Diversifying is the best thing to do though. While maintaining my blog (that makes nothing right now), I proofread for court reporters and authors and I teach piano lessons to children in the neighborhood. I think it’s always good to be looking for that next opportunity!
Marisa says
How did you get the opportunity to proofread? I’d be very interested in doing that, but I’m not sure where to start or look. Do you have to have a degree in something specific?
Cathy @ BudgetingForChristmas says
I have a little advantage because my husband works at a court reporting firm-he handles all the videography and IT support. So he gave my name to a couple of court reporters and they gave me a little trial run to see if I caught all the mistakes. If I were you I would research and contact court reporting firms (or independent reporters) in your area through an email explaining that you would like to start and give them a rate per page. Rates can range from 20 cents to 40 cents but I would start at 20 cents a page and maybe go up from there. If you can get a few reporters to use you at once, and they write around 300-500 pages a week, you could make a minimum of $180 per week. You can pretty much set your own limits as far as how much work you want to do. I will say it can be time consuming and just downright boring but I do like getting those paychecks!
As far as proofing manuscripts for writers, my mom writes books and I started out proofing for her until she got her own editor. There are publishing companies and media outlets that are always looking for proofreaders, just contact them and if they are interested, they will send you a test. Sorry it’s so long but I hope this helps!
Marisa says
Thank you so much!! I really appreciate your suggestions. It helps to know where to start. I will definitely try these options!
Cathy @ BudgetingForChristmas says
No problem! Let me know if you have any more questions!
Johnlyn says
I think a lot of people believe that you can easily make money blogging. I’ve been blogging for the past couple of years and am now starting to see a very small income (like itty bitty bitty LOL).
It takes a SIGNIFICANT amount of time to learn how to make money blogging. Time away from your family. If you are going to do that and need the money immediately, there are much faster ways to see an income (ie. take care of an extra child, work at Dairy Queen one shift a week, clean one house a week, etc).
Having said that, I continue to blog because I feel it’s something God wants me to do and my husband supports it, but it’s more of a ministry than anything.
As a SAHM there are several things I do around the house to save a significant amount of money….when I read this post it reminded me of all of the ways I diversify my “savings” around the house.
Even though it seems like saving $1.00 here, $.50 here, $2.50 here doesn’t make a difference, if you add it up over a years time you will see extra money (ie. find a way to save $1.00 per day and you’ll have an extra $365 per year.)
Andrea says
I definitely agree! I’ve had a blog in one form or another since 2001. I’ve never managed to generate a big audience, despite trying. And really, I should be spending season of my life with my children, not working. I do, however, use a few coupons, take a few surveys and make freebies and the drugstore game work for us.
Jessica @ The Abundant Wife says
I agree! I’m in my 6th month of blogging at The Abundant Wife. I’ve made about $30. For the hours I’ve put in, I could have made A LOT more money doing something else as you suggested. But I’ve always enjoyed writing, and have been writing update e-mails, blogs, and facebook notes for almost 10 years. So I’m hoping the time I put into blogging for a little income will eventually pay off. 🙂
Crystal says
Love your idea of diversifying your savings–excellent thoughts!
Heather W says
Great post! I originally didn’t have multiple streams of revenue, but from reading your blog realized it was something I needed to look in to. I kept my original work at home job & added tutoring last January. This month I started writing copy for companies. Thanks for all the great tips!
Julia says
I find this all fascinating, but I am scared to start blogging. It takes time that I don’t know I have! But I am a SAHM. Sometimes I feel like it’s now or never but I haven’t known where to start.
Eve says
I am a SAHM and would love to start blogging. i have researched online but cant find anything that can help someone clueless get started. Can you recommend some resources for someone wanting to get started? Have you written anything on that.
Also, I wanted to say thank you for your story about being debt free and buying your own home. I am also a lawyer like your husband. Sadly no one ever told me not to rack up debt and I did in law school and now i am suffering. But i believe in the power of prayer and I know God will help me out of this seemingly hopeless situation.
GOd Bless You.
Crystal says
I have a series on How to Make Money Blogging here:
https://moneysavingmom.com/how-to-make-money-blogging
There are many links in that series to other helpful sites and posts.
Jessica @ The Abundant Wife says
I follow Blogging with Amy. I didn’t know anything at all when I started either (back in April of this year). She gives step-by-step instructions from start up to long-term maintenance. I read about her here on Money Saving Mom!
Jackie says
I’ve been blogging a year now and I switched to self-hosting wordpress in January and I want to add ads, but I’m a bit clueless, I looked back at your sidebar advertising posts, etc. and I’m wondering where to start. I have about 8,000 page views a month. Is this enough to start making any income? I set up a google adsense account, but I’m still clueless. Should I pay someone to help me? Do you have any recommendations as to how and who to ask or blog to help figure out how to run ads from the beginning? You’re such a humble person to share all your insight; I share your blog with everyone I meet and advertise your blog to every freezer cooking class I teach!
Crystal says
You can start anywhere. If it’s something you want to do, go for it; don’t underestimate yourself or your blog!
Just set up space on your sidebar for ads and an advertising page with information on your ad rates, and then offer a special.
Heart and Haven says
My absolute most successful residual income comes from my Rental Properties. And it’s something I love to do, so it’s a win/win all around!
Amy says
We are just crunching the numbers to buy our first rental property. After taking money out of the rent for taxes, insurance, and maintenance, what is your average return? We are coming up with about a 4.5% return. It doesn’t seem like much to me, but right now our money is probably making 1% in a money market account. It is a big step to take and we want to make sure it is the best investment, but also realize that it is important to be well diversified. I would love to hear from everyone who has experience with this! Thanks!
sarah says
Our return is small, but we didn’t specifically buy a rental property – rather, we rented it out when we bought our next house. However, my point is that if you buy a property that you’re confident is going to appreciate, you’ll have long term return as well as short term.
katie says
We currently own three rental properties, the first of which we have owned for 10 years. My very best advice to someone looking to get into such an investment is to find a great bargain when you buy. We have bought and sold five properties in the years that we have been in real estate. As I have watched the market ebb and flow and I have watched the number of foreclosures in our area in the last two years, I am convinced that the best way to make a good return on your investment is to get a property for a bargain price. Just as we work to attain 50-80% savings on our grocery bills, rental properties can be attained for those same savings. Like our grocery savings, it is not without a measure of effort, however 50-80% savings on a property valued at 100,000 is well worth the effort and your ROI will be significantly higher!
Dee2 says
We had 13 rental properties for several years. We were lucky that we bought when interest rates and prices were low, but rents were high. We sold just before the market crashed for really substantial appreciation. We only bought if we had positive cash flow from the beginning. A rule of thumb – the more units per building, the better the cash flow. A 2 or 3 unit house will make more money than a single family and a vacancy won’t hurt as much. (Besides the taxes, insurance and maintenance, budget for 10% vacancy.)
Our lawyer is also a bankruptcy attorney. We bailed out a few people so they didn’t have to file bankruptcy and we got bargain houses. Some we bought the traditional way. Some we built new. We had 5 teenagers at home to help us clean up between tenants, paint and do repairs. It is a LOT of work. Telling our kids they were working on their college fund was MUCH cheaper than paying a contractor.
I had a team that I absolutely trusted – real estate agent, inspector, contractor, plumber, insurance agent and lawyer. I paid everyone right away so they jumped when I called.
We had several other businesses then, too. We are down to two, but we put as much of our cash flow from all of our businesses into stocks as we could, which long-term, are the best return and the least amount of work.
I am considering getting certified as a real estate appraiser to add an income stream (and get paid for something I do anyway).
Dee2 says
Oh, Amy…one more thing…. we didn’t carpet if we could help it (we used bound rug pieces instead) because we could rent to people with pets. So many landlords refuse pets, we got top dollar rents and very little damage to our houses.
Tiffany says
Dee – I absolutely agree with you about pets. We allow almost any quantity and size of pets meaning we get higher rent and rent our houses very quickly.
Anne @ Modern Mrs Darcy says
I work in this field and have seen many investors lose their shirts the past few years. My husband and I own one rental property right now. Crystal has inspired me to save up our $$$$ so we can afford to keep our starter-home residence as a second rental in a few years when our family of 6 completely outgrows our 3-bedroom, 1 bath house!
I would emphasize that rental property is great for long-term passive income. I love knowing that by the time my kids are in college, we’ll have at least one income-generating, paid-for house. But we don’t get the income from the rents now. It pays the taxes, mortgage, property insurance and maintenance, and any extra sits in the bank, because it might be needed for a roof, or a new HVAC system, or any of the other countless expensive things that houses need occasionally. The rent more than covers expenses, but right now it’s a long-term investment, not an income stream.
Nathan says
I would say that a 4.5% return is not enough compensation for all the hassle of a rent house. You’d be better off opening an account with Lending Club or buying stocks that are paying high dividends (like AT&T – they are paying about 6%).
The key is to buy a house that is “on sale.” If pay too much up front, you’ll always be behind the eight ball. I bought a foreclosure that was selling for about half of what the county appraiser had it valued at. The reason it was selling so cheap was because it looked really bad and I had to look past all the cosmetic wear and tear. Then I rented it out and made 20% on my investment. For about one year. Then I had to replace the sewer line. That cost $5-6k, and now my return is about 15%. Which is another reason I don’t think a 4.5% return is enough. It doesn’t give you enough cushion for those types of situations.
So I would keep looking. Keep your eye out for “distressed” property that is selling at a discount to other comparable properties, and I think you’ll find something a lot more attractive.
Tiffany says
Remember that 4.5% may be your return the first year or two but that will change. We’ve owned a rental property for 6 years and in that time, the rent has gone up by $350/month giving us a great return.
Jessica @ The Abundant Wife says
My husband is in youth ministry and I’m a SAHM, but we had to learn a lot about multiple streams of income this past year when he was unemployed! I wrote English curriculum for our friends in China, taught a few art lessons, substitute-taught and lifeguarded occasionally, and started a blog that (like Amy above) still hasn’t made any money yet. My husband long-term substitute-taught during the school year, and lifeguarded all summer. Now that he has a full-time job again, we’re hoping to set-up multiple streams of income in our new location. We’re trying to pay off our debt snowball, one item at a time!
I’m interested to hear more about what kinds of things are included in your multiple streams of income, besides blogging. Thanks for writing this series!
amy@twobgardening says
My full time job is great and pays all my bills with some left over. But, I’m thinking more along the lines of early retirement so I’m trying to get as much money as possible saved. I love to bake so I will bake sweet treats like muffins, cookies, scones, etc.. and take into work and sell them to my co workers. I’m working on making up a flyer to hand out also for advanced orders. It’s not a lot of money but the few dollars add up and it’s something I love to do. I also blog, but haven’t made any money at that so far. Still working on it. Love you site and all the great advice you give. Thank you for all you do. Sincerely, Amy