Step 34: Income stream 2: Profit Income

Step 34 of the 100 steps mission to financial independence: Income stream 2: Profit Income
Step 34: Income stream 2: Profit Income

Where step 33 described the features, (dis)advantages, and possibilities for change of an earned income, we are now going to look at profit income. A profit income is the money you get when you have a company (which can be anything from an Etsy shop where you sell handmade things to a multinational company) and are able to sell your products or services above the cost price thereby taking (some of) the profits as earnings.

Many people dream about having their own company, and although this can indeed be a lucrative project, being an entrepreneur also requires a lot of hard work, and often at least a few years before a company starts making a profit. It furthermore involves a lot of new skills, quite a bit of risk and a lot of perseverance, so the life of an entrepreneur isn’t always as rosy and making a profit income isn’t always as straight forward as it might seem. (You can take my work for this, I have some experience..). Continue reading

Step 33: Income stream 1: Earned Income

Step 33 of the 100 steps mission to financial independence: Income Stream 1: Earned Income
Step 33: Income Stream 1: Earned Income

In step 32 we looked at a quick overview of the 7 different income streams one can build, and in these next 7 steps we are going to look at each income stream in turn, to analyze possibilities of (further) developing each possible source of income. You shouldn’t however feel that you need to take action in all 7 areas, instead the main purpose is to make you aware of each income source so you can decide what works best for you.

Let’s start with the first income stream, which is your earned income. Most people get this from working for somebody else, although if you are an entrepreneur you might also receive a regular wage from your own company if you are taking a salary.

A key feature of earned income is generally that you are paid for your time, be that time you spend in the office, working from home, at conferences, at clients’ offices or wherever your job requires you to be. Generally speaking the more you work, the more you get paid: if you go from part-time to fulltime you get paid more, if you work extra hours you get paid more and by taking on a management role which might require more time (as well as extra responsibilities, experience and whatever else), you also get paid more. Continue reading