It's probably not a surprise that entrepreneurs experience more anxiety than their employee counterparts. A Gallup-Healthways Well-Being Index found that 45% of entrepreneurs said they were stressed out, 3 percentage points more than other workers. Depleted finances, pressure to succeed, and social, employee and family stressors can all get in the way of trying to turn an idea into a success.
The answer isn't necessarily earning more for the sake of earning more. Instead, you need micro income streams that work together towards a bigger goal that both alleviates stress while making an impact on your finances. Micro income streams may look insignificant at the start, but they all add up - and they offer intangibles like work experience, peace of mind and confidence. Here's a look at why earning a little at a time can be better than one big payday.
Increased Income Security
Although unemployment rates are showing signs of improvement, we still live in shaky economic times with sluggish wages. The days are long gone of relying on a company to financially boost us up the corporate ladder into bigger paydays and opportunities.
Whether you have a full-time job or thriving consulting career, creating micro income streams can create increased income security. Use that income for an emergency fund, to reinvest into your IRA or other retirement funds, and to build the kind of income security you need. No one else is going to do it for you.
Ability to Bootstrap Faster
Getting a company up and running quickly usually isn't an issue of motivation, but of money. Small Business Trends reported that 77% of small businesses rely on personal savings for their initial financing. Meanwhile, the majority of entrepreneurs start out with about $10,000.
Finding an extra $10,000 to get a business up and running may not sound feasible for someone who relies on a fixed wage or whose earnings barely exceed their finances. But a micro stream like speaking at events or offering freelance content marketing writing can help fuel a bootstrapped business quickly.
Validate Your Business Ideas
It's tempting to start building a business around a really great idea without actually validating it first. Use the Lean Startup approach and start testing your idea with potential customers and see how far you can scale it. One way to do this is by launching a marketing strategy consulting or freelance business first around your idea. As it grows, you can move into an agency business model to scale and spend more time working on your business instead of in it.
Build Your Credentials Faster
Spending years at a single job can actually slow your growth in your industry. Unless you have a proactive work environment with the support of management to grow your career, you could be stuck in the same role for years.
Meanwhile, developing micro income streams gives you a platform to step off of sooner than you would from a traditional career. For example, an aspiring real estate investor could work as a real estate broker or attorney by day, and invest in commercial real estate by night. Platforms like Realty Mogul allow investors to get started with as little as $1,000 for projects ranging from self-storage to hotels.
Work Smarter, Not Harder
There's only so much money you can earn in a day if you're strictly using an hour-to-income revenue model. Clocking in overtime is a limited way to earn more, and in salaried careers it's largely irrelevant. Meanwhile, burning the candle at both ends trying to build a freelance career also has its limitations.
A largely passive micro income stream allows entrepreneurs to work smarter, not harder. Author Dan Pink of "Free Agent Nation: The Future of Working for Yourself" understands the need for working smarter and applies it with a range of tips including a "to don't list" to eliminate time wasters like unnecessary meetings. Apply the concept to your income potential by creating an ebook or video course for clients to purchase without much follow-up work.
Take Bigger Risks
It's almost impossible to take risks in life if you're strapped for cash. It's hard to take a leap of faith and try new careers, travel the world while building your virtual business or scale back on work to focus on furthering your education.
Earmark your micro income streams to take those bigger risks you crave. Devote one income stream you earn through ebook sales to your business education, another earned from consulting to field new company idea, and revenue earned from odd jobs and freelance work to fund a big dream like traveling the world. Consider setting up separate savings accounts for each stream to organize your finances and allocate them accordingly.
Get Rid of Dead Weight Faster
Entrepreneurial minds already working on micro income streams may feel the weight of a money maker going nowhere. Maybe the WordPress design business you dreamed about has suddenly turned into a time suck, and none of your other dreams have the time to evolve.
It's impossible to cut loose the dead weight in your life without having enough back-ups to compensate for the financial loss. A single micro income stream that supplements your day job may not be enough. Focus on building a variety of streams, with at least one or two that require little work, to offset your other income. For example, renting out your own car on a site like Turo can provide relatively passive income while you figure out a more viable freelance income stream.
Do Something You Actually Enjoy
Slipping into a work grind is a normal part of growing a career, but it doesn't have to be. Focus on building micro income streams around hobbies and interests you actually enjoy. I love skydiving, but it's not exactly a cheap activity. If your hobby requires a hefty cash infusion to make it work, then specifically create a micro stream around that hobby. Bonus if you can combine the micro stream with your hobby. A skydiving enthusiast could work towards getting certified, and then sign up as an instructor with a local skydiving center to enjoy their hobby while getting paid for it.
What about you? What are your biggest micro income streams, and how do they perform better than one big payday? Let me know by leaving a comment below: