This was how it all started. A group of people studied highly successful people; people who have accumulated a vast amount of wealth. They wanted to know how these people got so rich so that they could teach ordinary people how they too can get rich.
They observed that the rich do not have one source of income. The rich invested in real estate, stock, and businesses. They were making money from different sources. So these wealth coaches, financial gurus or whatever you call them started teaching everyone that if you want to be financially successful like these rich people, you have to have multiple streams of income. You have to diversify; put your eggs in different baskets and hope that a number of them become successful over many years.
This would have been good if we lived in an ideal world. But in reality, multiple streams of income is not realistic for 99 percent of people. In fact, if you want to have a chance at financial success like the rich, you have to do the opposite of what these people are teaching.
Stay with me to the end of this video because I’m going to explain why 99 percent of people are doing multiple streams of income the wrong way – and how to do it the right way. Before we get to it, I’ll like to invite you to subscribe to After School TV and click the notification bell so that you get notified when we publish new insightful videos like this.
Multiple Streams of Income is not for most people
To be clear, it would be dream come true for anyone to be able to make money consistently from different sources that are not related to each other; without needing your presence and continuous effort. You get to diversify your risk and are not bound to economic shocks in one particular industry. It is something everyone would wish for. But what we wish for is often not in tune with reality.
So the problem is not the idea of multiple streams of income but with how practical it is for the current state of most people. There is something people that promote multiple streams of income as the solution to financial freedom don’t talk about. Few people ever succeed at building one source of income, let alone creating several sources. And the reason is simple; it takes consistent focus to build something successful.
One, we live in a highly competitive and fast-changing economy. The business has become highly specialized and targeted. Knowledge is growing exponentially, requiring specialized skills to employ it properly. It’s practically impossible to successfully compete in completely different fields.
Two, you have a limited amount of time on this planet to get all the things done, while also trying to balance the needs of family, health, spirituality, recreation, and relationships. You have one brain, two hands and two legs; and you’ve got 24 hours each day like everyone else.
Considering these two factors, among others, can you realistically and sustainably build multiple streams of income the way it’s made out to be?
One Stream of Income is your only chance at wealth
If you think about the most financially successful people today, you can easily identify their primary source of wealth. Aliko Dangote started with cement. Bill Gates built Microsoft; Jeff Bezos built Amazon. Strive Masiyiwa build his wealth from Telecom. You’ll find a similar pattern with more than 95% of wealthy people out there. They put all their eggs into one basket and then watched that basket like their lives depended on it.
‘Wealth is created when you exert intense pressure on one idea’. Your only chance at wealth and financial success is to put all your eggs into one basket and then watch that basket with everything you have.
The rich people may have multiple sources of income, but they started first and foremost by focusing on one income source. When I started my journey as an entrepreneur, I dabbled into many things; from the film industry to construction, electronics and commerce. Even when I start an online business, I was also trying to do many things; from web design and software development, to freelance writing and blogging. But my breakthrough came when I decided to focus for a long period of time on one source of income. The long and short of it is that you cannot build different income sources at the same time. There are two ways to really create multiple streams of income.
One is to invest the money you make from your major source of income into another source. Two is to create new ways to make more money from your primary source of income
Let me explain each of them.
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Leverage Income to diversify
The first realistic way to create multiple stream of income is to focus all your attention into building a system around one source of income until it starts making enough money to function without you. This is what most rich people do. They make a lot of money from their business, talent or skill. Then they invest in real estate, the stock market or other businesses. Unless you have a source of income that makes you more than enough money, you cannot diversify to build a sustainable second or third stream of income. So you have to focus first on building one income source.
Multiple Income from One Idea
The second realistic way to create multiple streams of income is to create new ways to make more money from your primary source of income, without affecting the operation of the primary source. For example, Amazon started as an online bookstore. Then without affecting the book business, it diversified into selling other kinds of products. It continues to expand its product line without affecting the existing one. Today, Amazon is in almost every industry in the world.
Another simple example is my online publishing business. We started with a website which became successful. Then we had a mobile application, then a book, then a YouTube channel, then training and consulting arm of the business, then more products on the way. Each of these arms of the business generates revenue and serves as a different source of income, but each one supports the other. One of the income sources may be affected without directly affecting the other. I believe this to be the most realistic way for create multiple streams of income; find different ways to make money from one idea or one field.
In a world where everyone is looking for what they can take out of it, do you really thing you can successfully watch all your eggs scattered in different baskets? Who do you think has the higher chance at success? The one that puts his eggs in one basket and guards that basket like their life depends on it; or the person that has his eggs in different baskets and has to shift his attention from one basket to the other?
Chasing after diversified income sources diffuses your focus and diminishes the amount of energy you can put into each one. It creates multiple demands of your limited time, energy and resources. The result is that you end up with several mediocre income sources or even lose all of them.
Your only chance at success is to focus on one source of income, and make it big. Then you will have the resources to invest into other potential income sources or even expand your existing source and explore every opportunity that source has to offer. That is the realistic way to create multiple streams of income.
In a nutshell, the realistic way to create multiple sources of income is to focus and master the first stream of income; then use the resources from that first stream to create additional streams of income.
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