It's time to start building
Once your business is up and running, you should take the time to explore the possibility of building additional income streams, including passive income. When you take the time to plan and set up, then implement these streams, they generate income for you without you having to lift a finger.
In the last post on this topic, we investigated the idea of Why you should care about passive income (follow the link to visit the post).
This whole thing sounds amazing to any small business owner, but you may not know the full range of benefits this type of system offers. Here’s a list of six benefits of you’ll get by creating passive income streams.
#1: Reduce your workload
This is the most obvious one and the first one most people notice: You don’t have to work so much. With passive income, you break the pattern of swapping hours for money (time+work = earnings). It can take considerable planning and upfront work to create your system for passive earnings, and there is usually some maintenance along the way. But once properly set up you earn potentially 24 hours a day without trading time or labor for it.
#2: Work fewer hours
You can use your passive income streams to reduce your working hours. Since you don’t have to work for every penny you earn, you can work less and use the extra time to restore your work-life balance, spending more time with family and pursuing other interests. Or you can devote that time to other areas of your business.
If you’re a freelance service provider, for example, you can focus more time on marketing, growing your skill set, and nurturing relationships, rather than just working.
#3: Reduce stress and money worry
A steady stream of income, even if small, can operate as a small salary to help you get through lean months. You have a base income to keep you afloat when hard times hit. You can also use this income to sustain you when you want to make some changes to your business and must take time off from regular work.
#4: Save Money
Many people set up passive income streams to use as savings for retirement, higher education, or healthcare emergencies. In various situations today, many are finding the social safety net is shrinking, leaving people to fend for themselves for their basic financial needs. With a steady stream of income on autopilot, you won’t find yourself stranded.
#5: Grow your reputation
One of the most common strategies for passive income streams is to create and publish information products. These digital products teach people how to do things using your professional expertise and experience. Releasing products such as these helps you establish yourself as an expert in your field and raise awareness for your brand.
#6: Make the most of your profits
Many businesses and freelancers find that they hit a kind of ceiling with their earnings. While working at full capacity, they’ve reached the most they can possibly earn. Passive streams of income allow you to break through this ceiling and earn more.
Yes, it all sounds great, but don’t fall for the passive income myth that says it doesn’t take any work. It takes hard work to set up, and a good deal of planning. But setting up passive streams of income can be beneficial to any company and allow it to scale.
Are you ready to start building a passive income stream in your business? If you think of it as building space to do the things you really want to do, what could hold you back from making your time and resources work harder for you? Share your thoughts in the comments.