How To Make Money Through Multiple Streams of Income

I believe everyone needs multiple streams of income because it acts as a safety net. Each stream of income can come from a different type of asset, for example, real estate could be one stream of income, and another could be having a business where you are marketing a product online or selling specific information online, such as how to invest.

As new ideas pop up in your mind, it's important to ask yourself, is this something I could be interested in? One thing I will always say is if you're not interested in the category or service you provide, don't do it. The second principle is you want the stream of income to eventually make you money while you sleep.

One of the biggest pieces of advice I stress is the importance of maintaining a stable job while nurturing a side business – listen to your intuition, if your gut is telling you not to quit your day job to create that new business venture, don't do it.

I remember when I was in my first real estate job, I was driving down the freeway and could hear this voice in my head telling me it's time to write your book. This was a profound moment because I was making good money at the time doing real estate but as soon as I heard this voice in my head I didn't know why it was at that moment but I just knew it was the right time.

Most people think of financial freedom as a feeling that they can buy a nice big house or car, but it's not. The amount of money that flows into your life so that you can live your minimal living income is something I call a Financial Freedom Number. You need to live like someone who has a low-medium income and stay at that level.

It's important to create a business that is like a money tree. Just like a tree that keeps growing fruit even if you're not watching it, the fruit will still grow, but in this case, fruit is money coming into your life through different streams.

If you want a business that is multiple streaming, you have to think of a product or service that is outstanding, a product that people want no matter what the economy is and it needs to be an essential item, that is unique enough that people will continue buying.

Start a business that uses as little money as possible. It's important to remember, that the more money you put into a business the more chance it will fail. Most people who launch a business will spend 80 to 90 per cent of their money on the goods to make the business, but then those businesses that aren't successful can't make it on a 20 per cent profit margin.

So that's why I recommend finding a business that takes 10 per cent of your money to create. For example, staff hiring costs take a lot of money when starting a business so find a sector where you don't have to spend the money on staff.

Real estate is a perfect example because you don't need a full team of staff if you can manage ten properties by yourself. Real estate is also a business that is essential for everyone every day because even when the economy has its ups and downs, people with homes still have a place to live so it fits the money tree formula perfectly.

These are my top tips to make money with M-O-N-E-Y T-R-E-E formula:

M: Multiple streams

The strategic approach of multiple streams ensures that if one stream of income dies, you have another one or a few other ones that will keep you going so you can launch another stream.

O: Outstanding product

As soon as the income starts to go, the economy starts to go, people stop buying that discretionary item, so create something that's unique enough so that people will continue to buy it.

N: No money down

The more money you have to put into it, the greater the probability it will fail, therefore you want a business that you can start with minimal money.

E: Employee resistance

Staff hiring costs take a lot of money when starting a business so find a sector where you don't have to spend the money on staff.

Y: Yield

Y stands for yield, meaning I want to make some serious money from it. Although I put a little down, I want to crush it and have a business that has an unlimited upside. You need to create a business that is scalable.

T: Trend and Timing

There has to be a trend. For every stream of income you add, you have to think: "Am I on trend here?"

R: Residual income

You want a business that resembles a money tree, one that keeps on growing even when your direct attention is elsewhere. Just like a fruit that grows on a tree, when you pick the fruit, it will grow on other crops. So that's a residual income stream.

E: Essential to everybody every day

What I love about residential real estate is that it's essential to everybody every day. So what I love about real estate residential real estate is it's essential to everybody every day. Therefore, when the economy has its ups and downs, they still have to have a place to live.

E: Enthusiasm

You have to like it, because if you don't like it, your business probably won't survive. Find something that you are passionate about and set yourself a goal that you will complete this year. Say to yourself, I want a side hustle by the end of this year.

I suggest never having more than three side hustles at one time, once you go over to three side hustles at a time, you will get overwhelmed and will put your money into ten projects then they all fail. It's good to have three projects because it gives you more opportunity to have multiple streams.

Making the side hustles work will lead you to be free. Always have two other smaller projects in the mix because you never know if the project you're putting most of your time into ends up dying. The smallest projects are always the ones that end up flying high

By Robert G. Allen

Robert G. Allen is one of the most influential investment advisors of all time and has authored numerous bestselling personal finance books.

After achieving a multi-million dollar net-worth in just a few years, Robert went on to pen his colossal bestselling book, Nothing Down: How to Buy Real Estate with Little or No Money Down, is the largest selling real estate investment book in history. He followed that success with numerous other bestselling books including The Road to Wealth, Multiple Streams of Income, and Multiple Streams of Income for the New Millennium.

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