3. Increasing Income

3. Increasing Income

We learned about the Monthly Cashflow Analysis in the previous lesson, which revolves around this straightforward equation.

Total Income - Total Expense = Profit

You can increase the profit by either increasing your income or decreasing your expense. In this lesson, we will learn how to increase your income, and the next lesson will be about decreasing your expense.

Increasing your income happens in three stages.

  1. Learn a skill that will be your primary source of income for a while.
  2. Push yourself to earn more with the acquired skill.
  3. Be an entrepreneur. Learn the art of testing and scaling side income ideas.

Let's look at each of these in more detail.

1. Learn a skill that will be your primary source of income for a while

You want to be investing all the money you make back into your self-improvement. All you typically need is just one valuable skill that will be your primary source of income. Some examples are:

  • Graphic design with applications in the Adobe Creative Cloud suite.
  • Video editing with applications in the Adobe Creative Cloud suite.
  • Computer programming
  • Sales. Learn to be able to sell any product or service.
  • Certificates.
    - Cooking
    - Realtor
    - Landscaping
    - Interior Design

The most optimum choice would be interesting enough for you to spend roughly 10,000 hours to master the skill and also valuable to businesses so that you can be paid well for having the skill. I would consider the former more important than the latter. Nowadays, with the help of websites like Fiverr, it is not difficult to find someone willing to pay money to use your services.

2. Push yourself to earn more with the acquired skill

Despite some people criticising the hustle culture, it is often necessary for those who want to be successful. Working as a full-time employee for one employer will only get you an average income at best. Chances are, you are reading this guide because you don't want to settle with that. Whatever your skill may be, there is only a handful of ways to increase your income even more.

  • Scale the operation bigger by hiring more people to replicate what you are doing. You don't necessarily work more but perform a different kind of work since you will now be managing people instead. This method is also the most capital intensive, and therefore it can be considered the riskiest.
  • Utilising your knowledge in the skill and the experiences you gained so far with it, somehow come up with a way to earn recurring income. Some examples include selling your intellectual property that others can use on a loyalty-based fee system in their products or services. You can also create online courses to teach your skill and sell on Udemy or Skill Share websites. This method doesn't bear any financial risk, but it would still be considered a risky option due to its high chance of failure.
  • The most straightforward way is to continue doing what you are doing but work more hours. You can do this for the same employer or find an additional one if it's not possible. This method requires the most work from yourself, probably far from earning the most money. Still, it is the most reliable and consistent method to increase your income.

We can see why it is often the best choice to hustle for most people as it is the most reliable way to increase income without any additional cost.

3. Be an entrepreneur. Learn the art of testing and scaling side income ideas.

I have seen a few people with great work ethics who hustled for their entire life with one skill. They could amass decent wealth doing this, but there is a much better way to do this in a shorter amount of time. Ultimately, making money with just one skill often has a hard upper limit regarding the income earned per hour. What doesn't have this upper limit is running your own company. For this reason, the best skills you can ever learn to make money are the entrepreneurial ones.

"Entrepreneurial skills" is such an umbrella term that it is so vague. Teaching such skills is way out of the scope of this guide, and a separate guide will be added to do this. However, the most critical thing to remember when starting your own business is to always come up with a way to test the most crucial part of your idea as simple and quick as possible. Verify that the business idea is worth investing more time and money in. It's ok to fail many ideas experimenting this way as long as you fail cheap and fast. Even if you are missing all the other entrepreneurial skills, you will eventually learn them all and become successful if you do this one thing right.

In conclusion, the ideal situation for everyone is always to have multiple sources of income. Having multiple sources of income has many benefits. It opens up many possibilities and spreads your risk so that you are not vulnerable to any one source of income failing.

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