by John Wedding
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Income streams are important. If you have one, or more, consider yourself blessed. Make sure you protect them …
If you're like me, you have a job, and you also may have money invested and in savings. Your investments may have lost some, or a lot, of their value over the past months.
But you are still making money, hopefully.Having a job or a source of income is more important than having a good return on investment. You can always make more money, but to do that, weelllllllll … you need to make more money!
Protecting your job is crucial. Developing more sources of income is also crucial.
How to protect your income streams
Your financial situation can go downhill quickly if you stop making money, and it can go uphill only if you continue to make money. Here are some suggestions for keeping your personal printing press up and running:
- Don't do something stupid at work.If your workplace has Internet policies, follow them. These kinds of infractions are trivial to catch. Hopefully, it goes without saying that you don't defraud your workplace of materials or misrepresent your time card. Basically, avoid doing the dumb things that will get you fired even if we weren't in a recession.
- Look for ways to get off the short list of people to be let go.Just like if you're hiking with a group, and a bear finds your group, you only need to run faster than the slowest runner in the group to avoid being mauled. Don't be the slowest runner. Find ways to get off the short list like taking on extra responsibilities or reminding your supervisor what you bring to the table so that it's fresh in her mind.
- Take overtime if this is in the cards.If your employment arrangement compensates for overtime, and you can do it, this adds to your emergency fund or increases the amount you can use to pay off debt. If you're salaried, putting in overtime gives your employer one more reason to keep you off of the shortlist for being fired.
- Take a second job?A second job does mean another paycheck, but taking another job isn't the best option for everyone. Taking another job does bring in more money right from the start, but if you are fairly secure with your current job, starting a business has a higher potential for growth.Consider both getting another job or starting a business.
- If you decide to take a second job, consider all the costs.How far do you need to drive? How much does that cost? Do you need extra childcare? A second job will do you very little good if it costs you more than you bring in.
- If you or your spouse decides to go back to work outside the home, consider all the costs.What will be the cost of day-care if you have kids? Would you be able to do as many of the little money-saving things if you or your spouse had a job? Two incomes will do you very little good if it costs more than it brings in.
- Start a side business?A side business has the potential to replace and exceed a job's income. But, as H. Jackson Brown said in Life's Little Instruction Book, overnight success takes about fifteen years. If you feel you need the extra money right now, a second job or overtime at your current job is a better bet. Consider both getting another job or starting a business.
- If you decide to start a side business, consider putting time into it initially rather than a lot of money.“Business opportunity” magazines are more than happy to sell you a $10,000 vending machine package but it's quite easy to start up a business with almost no financial outlay. If you want to begin blogging as a second source of income, You can get functional, professional web hosting for $6.95 per month with an included domain name (or you can register that one separately at GoDaddy.com, which is probably smart). That's about $8 per month, and the rest of the needed scripts can be obtained free. Then, just add your time and effort! This way is prudent in times of downturn.
- Check your tax withholding.This is a smaller fix but by adjusting your federal tax withholding you can keep more of your money throughout the year and get less of a refund the following spring. Just check the rules so that you don't have too little withheld and end up paying penalties.
- Take advantage of your job's benefits.A health savings account? 401(k)? Gym membership? Subsidized meals? Subsidized transportation? Education reimbursem*nt? Your salary might be just part of your “pay” so check to see that you're using everything that your employer offers that makes sense.
11 thoughts on “Back to Basics: Keep on top of your income streams”
I thing the thing that stands out most for me is that of developing more sources of income. I mean, I know my job is important so I think that is pretty obvious but generating that little (or lot) extra makes all the difference.
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Great points. WE can only cut our expenses so much. Building another income stream is a way to build some security.
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Great list to think about, but from a website point of view, I would recommend against using godaddy, as there are nightmare stories out there relating to their hosting. I only mention this because I'd rather have people spending time on their site making money, then dealing with customer service or uptime issues or who owns the domain and such…
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Excellent points about keeping yourself off the shortlist at work. I'm in a supervisory position and I can say that a positive attitude will keep you employed. If management needs to make some cuts and a few people are relatively equal, the one who is the larger administrative problem (whines, complains, talks behind other coworkers backs) is going to be the one who is let go first. Managers mostly want to get things done with as little hassle as possible.
If you think your position is in jeopardy, and you haven't been a stellar employee, go to your supervisor and say that you realize that things are tough and you want to know what you can do to help the business continue to succeed in difficult times. That attitude will put you on the short list of people to keep.
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Recession time or not, these tips above are a list of 'should dos' at work anytime. You have a job for one reason only: you're providing a valid service and contributing to the overall output of said company. If you're not pulling your weight, or carving out your own value of worth, you're a front runner on the shortlist.
Great post, and great reminder of what is and what is NOT essential/appropriate in the workplace.
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We should make a saving plan or invest some of our money in the long term.
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Your point about investing time rather than money is an excellent point. Especially online businesses, even a simple blog or website, takes a large time investment, but minimal monetary investment.
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The point about putting time into a new side business, as opposed to a putting a large sum of money into it, is important to keep in mind, in order to avoid being absorbed into appealing business traps. The troubles and anguish caused by business start-up are capitalized upon by various "entrepreneurs" that present material that are said to ease the procedure. The money given to them would probably be better used to provide time for oneself to build up a concept.
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At work, the best thing you can do is find a way to make your job into a job that makes money. I know this is easier for some roles than others, but it makes all the difference when deciding who can be let go.
In a software company, a sales guy who is still covering his/her costs and more simply will not be cut, ever. A programmer (say) who is producing bullet point improvements for new code will not be cut unless times are really tough. An office manager or the guy who does the documentation can go. Try and find ways to reinvent your role (or at least add to it) so there's a more direct impact on the bottom line, and you'll at least buy second thoughts from a boss or line manager.
Of course the downside with this is that you do have to make a positive impact…
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Some nice suggestions here and interesting articles. Now if only the government would do something to help the small businessman.
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Income needs to be primarily focused on the needs and necessities. More or less, there could be some of the major approaches that considered at the outset.
I liked the tips mentioned for the subjective approach of managing the cash flow and monetary management.
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