Nothing feels better than having extra cash coming your way to cover up when there’s an urgent need. Hence the reason why you shouldn’t stick to just a single income source.
If you still don’t see the need for having more than one source of making money, here are 10 reasons why you should consider having one.
What's in this guide?
1. To increase your earnings
This is the major reason why you should consider having multiple streams of income – because the more money-making avenues you have, the more money you’re likely to make.
Someone that have just one source of income will hardly have more liquidity than someone that has more than one income source of the same income-generation capacity.
So if you feel like the money you’re making is not enough and you’re trying to increase your earnings, one of the fastest and easiest ways to do so is to increase your income streams.
Also Read: Ways To Save Money In Nigeria
2. Financial security
You must have heard of the old saying “ don’t put all your eggs in a single basket “ so if the basket gets broken or torn you don’t lose all your eggs. The same thing goes with having a single source of income and having different strings of income.
When you have multiple income streams and one fails, you can still depend on the other to earn you money. But on the other hand, when you have just one source and if that source fails, you’ll be left with nothing.
3. Cover up for demand uncertainty
If you have a business that people demand seasonally, then, you can’t do without having a diverse income stream. This is important to help you to keep surviving when there’s a low demand for your product or service.
For instance, if you offer home renovation services, you are more likely to have a high demand for your service when a festive period is approaching or towards the end of the year.
With that kind of business, it’s possible to go a whole month without getting a contract. Hence, you won’t run out of money if you have other ventures that bring in money for you during that period.
4. You can meet your financial target
Financial coaches talk a lot about the importance of having financial goals. Your financial goal may have to do with earning a certain amount of money monthly at a particular age.
It could also be to have some specific real estate properties or you project to start your dream business when you clock a certain age.
Most times, it’s difficult to reach our financial goals without having more than one source of income.
For instance, if you work in a firm that pays less than N100,000 monthly, it will be almost impossible or take a lot of years for you to start a multi-million agricultural business if that’s your plan – especially when there are so many bills to pay already.
But if there are other streams of income, you can easily save up and even get additional loans to achieve your dream business.
Also Read: How to become rich
5. For Business growth and expansion
Having multiple streams of income is one of the fastest and easiest ways to grow and expand your business.
A good indication that a business is thriving is growth. And many times, it requires additional, external funding to expand a business.
And as you may know, getting funding from investors and financial institutions to expand your main business may be a difficult one. But if you have other streams of income, you can easily pump in more money from the proceeds of the other income avenues to expand your main business.
6. Financial stability
It’s a common thing to run out of cash or become broke as it’s popularly called. This financial state occurs more with people with a single source of income.
Income sources are like humans too – they can feel sick and get tired, … In other words, there can be times that your main source of income is not performing well and not bringing in money as expected.
And if you keep depending on that income source, you will be financially unstable. But, if you have more streams of revenue, your financial stability will not be very much affected even when one of the streams is not performing well.
Also Read: Top 50+ must-know entrepreneur quotes to keep you going
7. Frees from job slavery
Nobody likes to be under anyone and have other people bossing them around and talking to them anyhow. However, you will hardly not have this experience while working with other people.
Many employees suffer and endure maltreatment from their employees for the fear of being laid off and not being able to take care of themselves and family.
But, if you have other financial sources to bank upon, you can easily withdraw from such a terrible working environment.
There have even been stories of people who had to get to bed with their bosses to keep their jobs. But it’s easier to say no to that kind of offer if you are doing other businesses that fetch you money regularly.
8. Improved standard of living
Having a single income source can limit your living standards because there are a lot of things you would like to do and a lot of places you would want to go but are unable to because of your earnings.
When you increase your income streams, you start making extra cash and you can go on trips and buy the things you want. You are also able to improve your lifestyle like the house you live in, the food you eat, and also the cars you drive.
9. Increase your saving
Most times, when you have just one income source, it’s not easy for you to save up enough money, and even sometimes, you are unable to save at all.
But having more than one income source brings in extra money for you to be able to save comfortably and without any hassle.
Furthermore, even when you have just a single source of income and you try to save, some unforeseen and compulsory circumstances like sudden medical bills can thwart your savings. But, you can avoid that when you have extra income sources.
Recommended: How do you decide when to save and when to spend?
10. Live a debt-free life
Not mincing words, most people with only one source of income live in bad debts from January to December. That’s because they have to borrow every time to meet up with their ever-growing expenses.
And there’s something about bad debt – it keeps multiplying. You can hardly overcome debts without having multiple income streams.
So, to live a debt-free life, you need to find a way to start making an extra income.
Recommended: How to pay off debt and earn financial freedom
Final thoughts
If you were having doubts about getting an extra income source and you have been looking for someone to talk you into it, hopefully now you’re more convinced on why you should. And even with the level of technological advancement, it’s not that difficult to start making an extra income.
