I always say that nobody ever built any real wealth by earning and saving. If you want to build wealth, you need to learn how to invest. Period. Luckily, there is a lot of room for creativity and diversity in terms of how you invest—it can be fun! In this blog post, I am going to list 7 income streams you can utilize to maximize your earning potential. In addition, you will learn:
- What is Money Mastery and How to Achieve It
- The Best Way to Invest 1k
- The #1 Most Important Thing to Understand as a Business Owner
- How to Invest 10-20k
What is Money Mastery?
“No one can serve two masters, for either he will hate the one and love the other, or he will be devoted to the one and despise the other. You cannot serve God and money.”
(Matthew 6:24 ESV)
Jesus said it plainly—we can’t have two masters. God must be the ultimate Lord of our life. Money mastery is all about getting to the place spiritually and financially where money doesn’t consume your headspace. You can be a slave to money if you’re poor, and you can be a slave to money if you’re rich. It all leads back to your money mindset. For more on that, check out this blog on money mastery in terms of financial freedom.
The Best Way to Invest 1k
Before you invest in anything, you should invest in yourself. So, the best way to invest 1k is to increase your investing knowledge (kudos to you for reading blogs like this—that’s the first step!) You need to understand a measure of financial stewardship before you invest in anything like a business or investment property. Sure, you could allocate some money to a Roth IRA or a brokerage account, but it’s valuable to invest some of your income (I recommend 5% at least) on your own. That’s how you learn. Never invest in what you don’t understand.
In fact, the most important thing to understand as a business owner is finance. (Yes, I include active real estate investors in this category.) By finance, I mean knowing how the money comes and how the money goes. So, invest 1k in classes, books, and programs that will help you wrap your head around financial concepts.
How to Invest 10-20k
As you’ll see below, there are a lot of ways to invest 10-20k. But if you’re asking me (and you are reading my blog) I recommend getting involved in real estate investing. Here’s why: when you invest $10,000 somewhere like the stock market, you purchase a $10,000 investment. However, when you invest $10,000 on a down payment for a property (10% down), you purchase a $100,000 investment. If you rent it out as a buy and hold property, your tenant pays the mortgage through their rent. For more reasons why I suggest you invest 10-20k in real estate, check out 8 Benefits of Real Estate Investing.
7 Income Streams
An income stream is simply a pathway through which money comes to you consistently. It is wise to have several of these 7 income streams in your portfolio. It may take you some time to set up your system, but don’t let this dishearten you. In due time your money will be working for you—not the other way around.
- Earned Income: This is the money you earn from working a job. It comes from your paycheck—there’s not much more to it than that! You put time in, and you get money out. Side-hustles or part-time jobs in addition to your full-time job can bolster this income stream. However, it’s not the most efficient option since you have to be physically present to gain earned income.
- Business Income: This is any money you earn from entrepreneurial endeavors, whether they be a large company you own, a small business, or any freelancing gigs.
- Investment/Interest Income: This income stream can come from a variety of places, including interest earned from high-yield savings accounts, brokerage accounts, ETFs or mutual funds, cryptocurrency, etc.
- Dividend Income: This comes from assets such as dividend paying stocks. They provide quarterly or annual payouts to their shareholders.
- Royalties: When you create content or a product and sell it to another company, they may provide you with royalties based on its performance. You can get royalties from books, learning programs, music, or other products. I used to earn royalties on cassette tapes that had my teachings (I know that dates me, but remember–I’m only 39!) Now I earn royalties from my books.
- Rental Income: This income stream comes from investment properties you may own. You can earn rental income by renting your properties to tenants for housing or vacation properties.
- Capital Gains: This is money you make when selling an investment or a property. (At our WB conference and real estate conferences we love to tell people how they can mitigate or eliminate the taxes charged on capital gains entirely.)
Wish I knew about real estate investment when I was younger. I am 60.
I want to learn more.
Tanea, that is great! Please email email@example.com with your questions or guidance about how we can further help you along your wealth building journey.
Hi, loving these teachings. I have £10k, no debts but quite a low income. I own my home with no mortgage. I am interested in property development but wondering if I need to increase my income or capital first. Thank you