Life seems to like to pass us by. Things change. The job market changes, and demand for our services can sometimes drop down to almost zero, but you still need to pay the bills and have a roof over your head and somehow keep saving a high percent of your income for financial independence and of course it would be nice to retire early too, right?
Have you diversified your job and income? It may sound strange to some who was taught to be specialized through university degrees and get a good job to diversify income, but it is important if the only company that needs your specialization closes and you don't want to move to another city. If they downsize or outsource you, what will your options be?
Diversifying your income could mean for a self-employed person (like myself) and increase in one area while the demand for another service goes down since things seem to go in cycles.
Currently I have two activities. I teach English classes (and sometimes do translations), and I sell prints of my digital artwork (and photographed traditional artwork) on the internet. The second income is semi-passive since once I upload and make images available they'll stay available as long as I have an account on a Print on Demand website. However the initial time investment is huge so unless you sell hundreds of copies of something you'll be making less than minimum wage. Still It is something I love and it helps pay the bills. I also like it because I can do it whenever I want to and not do it when I have some other activity.
Classes are more complicated. I make more money teaching, but schedules are more or less set and there are many cancellations and other problems. The biggest problems are that I can't have a fixed schedule from say 8 to 11 am. Instead it is before my students work and later during the lunch hour and sometimes after they finish work. In other words I lose a lot of time between classes and in transportation going to and from classes.
I'm not saying that you should do either of these activities. Instead I think you should take some small risks to try different activities to generate a side income that you could invest or save for other new income streams. It doesn't have to be anything complicated. If you're a woman you might be asked to babysit after work or on your day off. Perhaps you could help with weekly cleaning or doing laundry for a friend who works all day.You could sell something you make or grow. Really there is always something you could do.
This month I'm taking a small risk. I decided to take my potential savings for the second half of the month and spend it on professional photos for my "book" for a modeling agency. I know there is some demand since I have been contacted by two agencies and one was quite insistent in seeing me. They would send my info to potential third parties for commercials, advertisements and perhaps as extras and send me information about casting evernts when my profile might match. If I get used for the project they'll take 10% of the income each time. It sounds quite fair for me and it isn't exclusive.
Of course spending my second half of the month savings plus a little more is a risk. Perhaps I'm not attractive enough to get selected. I am not very fit. I'm a little flabby mostly because I'm not very motivated to exercise alone so the photos that were taken yesterday won't be as good as some guy who works out in the gym, but I decided to give it a try. The worst case scenario is that I'll have a set of nice photos to upload to Facebook for friends to laugh about the poses. The best case scenario would be getting regular work and increasing my income significantly.
Why do I consider this a small risk? First of all, I'm not taking out a loan or borrowing money for the photos or anything related to this. I did buy a new shirt and some exercise clothes since if I go through with this I need to be in better shape for castings, but these are normal clothes which I can still wear whether or not this generates income. Additionally, this is a small risk since the investment is minimal. including the clothes, it was about 50% of this month's income (I bought cheap clothes not name brand). Finally it is a small risk since further investment would be in things to improve my health and I suppose if I do get off my rear and exercise regularly I'll want to have new photos taken in 6-9 months. Compare that cost with starting a workshop, building a greenhouse or a lot of other income generating hobbies and it isn't bad. Yeah I might join a gym, but if I do it will be a cheap one. I will most likely buy a set of dumbbells and go to 10 peso Zumba classes a neighbor gives. In any case, health is always a good investment.
What you should not do is spend all or most of your savings or take out a loan for something that you might make money from. If you know there is demand for something you make or do and it requires an investment in machinery or other equipment, see if you can rent or borrow at first and calculate how many paid projects you'd have to do to pay for it. If people are asking for something that requires an investment in expensive equipment, ask to be paid at least half in advance and/or have a contract signed. Once you have one regular stable client or multiple repeat customers, the investment will be less risky.
What if you cannot even accept the small risk of half a month's savings for something that might make you money? Don't bother, just buy Certificates of Deposit in your bank. :-)
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