( The following article was found by my wife on the internet and unfortunately, I can't find the author. But I agree 100% with their opinion on Multiple income streams. Much of the stress, frustration, and financial hardships that so many people have gone through the last few years could have been avoided by increasing your options. I teach this principle daily... and you don't have to do what I do, but you do need to do something! )
Enjoy, Lance
www.lancesmith.com
Take a Hummer full of average self-made millionaires. Strand them in the desert. Strip them of their money. Take away everything they own. Rob them of their connections, their networks, their families. Ten to one they’re millionaires again in less than five years.
Can you be a millionaire in five years? As it stands right now, probably not. So what is it that’s different about John Q. Millionaire? Why can he take his kids to Euro Disney and you can’t? Because he depends on himself and the rest of the world depends on, well, the rest of the world.
We used to be self-reliant. For 40,000 years of human history, we depended on ourselves. We were part of a small network of people who helped each other out, but mainly we fixed our own clothes, cooked our own meals and traded our own chickens to make our way in this world. We were Jacks of all trades. When our roof broke, we didn’t hope we had money left on our Visa to pay a specialist to come out and fix it — we cut down a tree and went up the ladder. If the wheat crop was poor, we always had the cows. Wife took in some sewing work, husband ploughed the fields. If one thing went wrong, we didn’t cross our fingers and pray the big man down the lane would waltz in to take care of us. Sometime around the industrial revolution, we gave the responsibility of feeding our families to a bunch of old guys in suits that cost more than our car. Or horse, as the case may have been.
Rich people came in and, as part of an income diversification strategy, decided to build some factories. We started to specialize. We became widget stampers, widget joiners, widget movers. Our self-identity became one of what we did to which widgets for eight or 10 or 12 hours a day. Western culture became one of efficiency. How could we do it faster? How could we make it easier? How could we work it cheaper?
Then, on April Fools’ Day, 1913, Henry Ford added a conveyor belt to the whole process and generalism went to hell. Flash forward 95 years and we live in a world of 10-page job descriptions that itemize exactly what we do — and more importantly, what we don’t do. We put cute little comic strips in our cubicles that scream “Not my department”. We do the same thing, every day, for years at a time. Optimally, we do our one thing and one thing only more efficiently than any other person in town. And in order to ensure we have time for all of this efficiency, we have outsourced the rest of our lives to other specialists. Specialists grow our food and make our clothes and educate our children while we go be specialists for someone else. We believed we were making things easier. Instead we were handing over every tiny scrap of personal power we had left. Because in addition to making life soul-suckingly boring, this specialist employee system made us really, really vulnerable. We are totally dependent on a bunch of strangers to make sure little Madison and Jacob can keep going to Baby Salsa. We depend on everybody else standing at the conveyor belt to not screw the whole thing up, increasing company costs and decreasing employee salaries. We depend on the dude above us, the one who kissed so much ass he got off the conveyor belt, to dole out our raises and not favor the guy next to us. We depend on the marketing department to do a good job selling the stuff that comes off the conveyor belt. We depend on the guy who owns the conveyor belt to act in a fiscally responsible yet compassionate manner. We depend on the public at large to keep their own conveyor belt jobs so they can afford to buy the widgets we’re cranking out so efficiently. And if every single one of those people on whom we depend does their job the way we hope they will, we get a check every couple weeks that pays most of our bills. That’s good, right? That makes it all worth it, doesn’t it?
How The Rich Stay Rich The primary breadwinners among us hesitate to tell our spouse that the raise might not come through this year. We whisper, so the kids don’t hear, that maybe our vacation has to wait. Maybe the remodeling plan was a little ambitious. Maybe we can make do with the old Corolla. The stay-at-home wife tries to stretch the turkey to make a few more brown bag lunches, pastes on a smile and tells the little ones that Daddy’s doing the best he can. The single mom tries not to cry when she tells her kids that of course she misses them when she’s at work. She would have loved to be with them when they had chicken pox but she couldn’t afford to take the day off.
Why does this happen? Because we rely on one stream of income and construct our entire lives around the panic that it might disappear. The rich, on the other hand, have been handily avoiding this trap for years. Their golfing buddy the financial planner has been ensuring they diversify their investments so economic downturns don’t hurt them. The conveyor belt hysteria doesn’t affect them in the slightest. Our paycheck can’t even send little Aidan to hockey camp. We’ve got nothing left to invest in anything, let alone a diversified portfolio. But as the pundits so wisely explain — right after explaining that the ticket to riches is cutting back on your latte consumption — that diversification is the key to wealth, security and freedom. As in, you’re not supposed to put all your eggs in one basket. Would you put your family’s life savings in one stock? Would you put little Emma’s college fund into something you don’t understand, has no guarantees, and over which you have zero control? No? Then why are you doing it with your family’s income?
Recently, in a small town in Ontario, the area’s largest employer closed its doors. Most of the town, trained only in the art and science of making canned soup, found themselves out of work. A few thousand soup makers live in a town where nobody wants to pay them to make soup. Now all of them are going to try to find a way to apply their skill sets to other employers in the area. The competition is fierce, and their mortgages are on the line. Except there are no other major employers in the area, least of all ones that can make use of Jerry’s 12 years of mushroom chopping experience. Some of them will find jobs, sure, and good for them. But many others are going to have to reinvent themselves. Reinvention is difficult enough. Reinventing yourself, your family’s lifestyle, your social status and your skill set in an economy where everybody else is trying to do the same thing is virtually impossible. But let’s rewind the clock a few years for our favorite mushroom chopper, Jerry. Imagine if Jerry had found a few hours a week, when he wasn’t at the conveyor belt, to diversify the sources of his family’s income. Maybe he started a mushroom blog and now makes a few hundred bucks a month in affiliate income promoting the latest kitchen gadgets. Perhaps his wife picked up the knitting needles and started whipping up a few shawls and baby blanket. Maybe she found she was good at this knitting gig and started designing a few patterns in her spare time. Jerry’s family picture looks a whole lot different. Flash forward again to the present, and Jerry’s mushroom chopping job is in jeopardy. His buddies at the conveyor belt are starting to freak out, but Jerry’s little income streams have been growing and they’ve started to add up. Jerry and his family now have options. They have choices. They have leverage. They have freedom. All because Jerry and his wife decided to turn off the CSI reruns and look into diversifying their income streams. He didn’t have to make a big, loud proclamation that he was quitting his job at the plant. They didn’t have to spend a fortune on office space or new computers or ergonomic chairs. They didn’t need business cards that said, “We’re serious business owners, dammit.” They just needed to diversify. For hundreds of years, diversification has been the luxury of the rich. Now, in the wake of broad globalization and mass internet access, we have a ticket to escape from this madness. It has never been easier to connect with suppliers, clients, customers, searchers, readers, fans.
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