A Little Something on the Side
Multiple streams on income make sense
I don’t know if you have ever thought about it before, but having more than one source of income is really pretty neat. Maybe you can’t get a raise from your employer. Or maybe you just need to pay for that family vacation without borrowing money. Perhaps the economy has smacked you around a little and you can’t find a job that is as good as your old one.
Whatever the reason, having more than one source of income provides a sense of independence and security that’s hard to beat.
Problem is, most people don’t think about how to actually develop extra income. They may put money aside for savings with a view to earn interest. Or they may invest in income-producing stocks. These are good things, but given the nature of the economy, they require large sums of money to really have an impact. I suggest that those that already have large sums of money to save or invest probably already have the income equation solved.
Regardless of whether this is the first time you’ve thought about this, or if you are an old hand at money making, let’s talk about the things you need to consider.
The first thing you want to consider when choosing an income source is the investment. This refers to both time and money. In the case of time, the issue is not how much (we all the same amount) but the availability of the resource. For example, if you are newly retired you will probably find (after a few weeks of well deserved rest) that you have time on your hands that is going to waste. After all, daytime TV is frighteningly bad. But, if you are a young mom with a toddler and another addition just added to the family, available hours to do anything are almost non-existent. If you work the night shift, whatever you want to do has to be doable in the daytime when most others are working. Get the picture?
Of course, the season can have an impact on time. Even in this age of balanced schedules, teachers have longer breaks available to them than most others. And some income sources only come up certain times of year. Stores don’t hire Christmas help in July, for example.
But there are many, many people who make time. Of course, there is a price. We’ve all heard about authors who get up at 4 AM to write their masterpieces. But then they either have to lose sleep, or cut into family time the evening before. The simple fact is you can’t do two things at once.
The financial investment is a bit easier to deal with. When starting a new business venture, there will always be some level of investment–call it a “buy-in.” Why use this gambling term? For the simple fact that every business is a risk. If there is no risk, it is not a business. So the question is, how much risk can you afford?
It’s interesting that the more likely a business is to succeed, the higher the cost of buy-in. It costs right around a million dollars to start a McDonald’s franchise. Yet, the number of McDonald’s that fail is very small relative to the total number of outlets. That increased chance of success is part of the value you get from the fees you must pay.
Compare that with the relatively small cost to join most MLM businesses. It’s usually under $100 to represent firms that sell directly through a networking organization. If you have done very well with Primerica or LegalShield or doTerra or any of the other similar businesses, please don’t take offense. Your products are all good, they all satisfy a real need, and the marketing method has been proven over and over again. But the truth is that most of those who sign up don’t become independently wealthy doing it. In fact most don’t do well at all.
So that brings us to the second thing to consider–what do you do with that investment? How do you convert the time and money into more money, and hopefully more time, eventually? Just like the source of the investment, the answer to this question depends.
If it’s McDonald’s, you get the manuals, the training, the experiences of hundreds of thousands (maybe millions) of restaurant operators to steer you right. You get the McDonald’s company to seek out and build your location. With an MLM company you get the help of experienced proponents of the service or product being distributed.
But what about the independent entrepreneur? What about the person who simply pursues an idea or vision, hoping to make money while improving the lives of others by his or her efforts? There the path is less clear. There the time factor often outweighs the financial factor in the investment. The sources of help are less organized and less certain.
Often enthusiastic and hopeful business starters are victimized by unscrupulous people. They try to sell the visionary on a success plan or system that benefits the vendor more than the fledgling entrepreneur. Often the success these types promise is expensive and complicated. Even if the program could succeed, the cost exhausts the funds before the new business even gets off the ground.
What’s to be done? That’s up to you. I could go on about the advantages of an MLM business. And, one day I probably will.
But for today I want to pose a possibility. You may be interested in this idea. You may know someone who is interested in this idea. Either way, there is an easy way to start up a business that everyone needs for three months out of the year. I certainly need folks to help me with my venture in this business.
What am I talking about? Why tax preparation, of course. It’s a complex and sophisticated process that requires a knowledge of law and of human nature. As long as the US tax code remains the way it is (and I really don’t see it changing much), there will always be those who will benefit from the advice and service of a knowledgeable expert. And every expert deserves to be paid.
How do you get started? Well, I suggest a tax course taught by and experienced tax preparer backed up by solid educational material. It takes some time, and involves some monetary investment. But it could pay off in the end.
I’d like you to take a look at my offering. Either here at the sidebar, or by going to IndyTaxSchool.com and checking out the course. Even if it isn’t right for you, I’d appreciate a comment here about your thoughts. And if you know about someone else who seems right, please share with them as well.
Then next week, I’d like you to come back here. I’ll be expanding on the idea of getting started: of moving from a basic idea to a full fledged business operation.