How to Diversify Your Income to Make More Money
We all know that it’s risky to keep all our eggs in one basket. Yet when it comes to our livelihoods, most of us do it anyway.
Relying on a single income stream can put you at financial risk if you don’t have a safety net to fall back on, such as a rainy day fund or another source of income. Without diversifying your income, your ability to pay your bills remains in the hands of a single entity that you probably have little control over. Think about what would happen if you were to suddenly get laid off or demoted from your only job.
This is why we recommend diversifying your income. With a diversified income, you’re much more likely to be able to quickly and easily recover from a sudden change in job status.
However, that’s not the only reason why you should have multiple streams of income. They are important in helping you:
- Become less dependent on a single employer
- Reduce your financial risks while increasing your financial rewards
- Develop or discover new skills and talents to continue upskilling in the gig economy
And who knows – your secondary income source can grow enough to allow you to quit your day job or turn this hobby into a full-time hustle!
The best strategy for how to diversify income streams will depend on each individual’s unique situation and may require some financial risk or investment at the outset. For example, those who don’t own a vehicle will need to purchase or lease one before becoming a rideshare driver. It will also likely depend on what skills, resources, and time you have at your disposal. Knowing what you have readily available or how much you’re willing to invest can determine how to diversify your income in a way that best matches your lifestyle.
Now the real question is, what are the best ways to diversify income? Here are a few strategies for getting started and learning how to create multiple streams of income.
Turn a hobby into an income stream
One of the best ways to diversify income is by turning a hobby or skill into an additional source of revenue. Whether you enjoy photography, knitting, or organizing collector items, there are online marketplaces and platforms such as Etsy, to help turn your hobby into a side hustle.
Think of the activities you enjoy during your downtime and consider how you can turn it into an income stream. Let’s say you enjoy knitting hats – you can easily create a few knitted hats with minimal startup costs and immediately start selling them on Etsy. Since it’s already a developed marketplace, there are already customers online that may stumble upon your creations.
Offer a local service
If you have skills or interests that others can benefit from, there are even more opportunities to discover how to diversify your income. For example, if you happen to be great at math, speak a foreign language, or play guitar, there may be folks that are willing to pay for lessons. All it takes is to put an advertisement up on social media or flyers around the neighborhood!
You can also earn a side income by offering more traditional services, such as babysitting, snow shoveling, or watering plants. There will always be people interested in the extra help, so why not try to make a few bucks offering it? You can often set your own schedule and prices to your liking.
While it can take some time to build up your clientele, you can turn to several online platforms to help you find local customers. This is a great idea if you’re just starting because it provides added degree of security and peace of mind. You can get hired for small, local jobs on platforms like TaskRabbit or help take care of the neighborhood’s furrier residents using Rover. Whatever you’re interested in, there’s probably a gig platform for you!
Freelance online
Now it’s easier than ever to take some of those talents, skills, and interests to a broader audience. Remote work has been on the rise as technology and online platforms have enabled workers to complete projects regardless of where they live. The opportunities are endless and all you need to get started is an electronic device to work on and an internet connection.
You can take your local services online and offer them to anyone, anywhere. Teach English to kids from across the world, write articles for startups looking to expand their content footprint, and more! You have the ability to not only grow your own skill sets and freelance experience, but you can help individuals and companies at a distance.
There are various platforms for you to consider depending on your expertise and interests. Just about anybody with marketable skills can tap into a global marketplace on platforms like Fiverr and Upwork. It’s a great way for you to pick up work whenever you want.
Rideshare and delivery
Own a car or a bicycle that could be put to good use? If so, you’re already well on your way to joining the gig economy as a rideshare driver or courier. Working for food delivery platforms like Uber Eats, Skip the Dishes, and Doordash, or rideshare platforms like Uber and Lyft are great ways for you to turn spare time into extra cash.
How much you can expect to earn will depend on several factors, including the rate per trip, mileage, and tips. These amounts can vary between apps, which is why many gig workers will work on more than one rideshare app at once. It gives them leverage to work for whichever one will offer a higher rate at any given time.
If you really want to make extra money on rideshare and delivery platforms, you can maximize your tips by executing a seamless delivery experience. Simple actions such as double-checking food deliveries before leaving the restaurant or handing over the meals with a smile can enhance the experience for your customers, thus increasing the chances of a greater tip for you!
Another way to increase your earning potential if you’re delivering on a bike is to take the next steps with an e-bike. With an e-bike, you can do more orders in less time and work longer hours if need be without tiring out. While this is an upfront investment, the return is much larger if you were to compare the two.
Get a part-time job
A more obvious way to create multiple income streams is to juggle multiple jobs. Adding a part-time job to a busy work scheduling isn’t always ideal for those with a lot of responsibilities outside of work, but if your evenings and weekends are usually free, then you can turn that extra time into another source of revenue.
The downside to getting a part-time job is that you may have little say over your schedule, making it difficult to balance multiple jobs at once. In fact, this is one of the reasons for emphasizing why you need multiple streams of income. Knowing that an employer decides on how many hours you work a week and when you work is why many will turn to gig work.
We recommend laying out your options and determining how much time you can give up to an employer, or if it’s even the route you want to take.
Rent out your property
In a best-case scenario, you’ll get to enjoy additional income without having to work too hard for it, which is why so many people invest in rental properties. Being a landlord is expensive, but once you own the property, there’s often very little work required to cash rental checks each month.
Even if you don’t have the money to invest in a home, you can diversify your income by getting creative and renting out other property you own, like a storage locker, parking spot, or even your car!
There are opportunities to make money everywhere, whether that’s through an online marketplace, on a gig app, or in your local neighborhood. If you’re interested in learning more about how to diversify your income in the gig economy and which gig apps to join, you can check out our other blog posts and sign up for our newsletter for the latest updates!
Alwin is the Growth Manager at Moves and a part-time freelance photographer. With the rise of the gig economy, he is excited by a world where people can have greater flexibility over their work and challenge the norms of having a traditional 9-to-5 job. Alwin is also an avid travel enthusiast and Toronto Raptors basketball fan.
