The path to financial success won't always look like a straight line. There will be high highs, like when you invest in a promising startup and see your portfolio grow, and low lows, such as when your company downsizes or you lose your job.
Creating multiple income streams helps protect you from the impact of these kinds of setbacks. Here are ways you can start earning more money.
Start a Side Hustle
Whether you’re saving for a big purchase, trying to pay down debt (can student loans ever go away?) or just want a little more breathing room in your budget, the best way to make extra cash is with a side hustle. Having an income stream outside of your day job can help you reach a savings goal, get out of debt faster or even start investing.
Before you jump in feet first, it’s important to determine your goals and decide how much time you can dedicate to a side hustle. Having an end in sight can help you narrow down your options, so you don’t waste energy or money. For example, if you only need to buff up your vacation fund, it’s probably not the best idea to turn your home based tutoring business into a full-blown small business.
As you research potential side gigs, think about your skills, interests, resources and connections. For instance, if you have a knack for baking, consider selling your creations online or at local markets.
Other popular side gigs include working as a virtual assistant, delivering food orders through services like Uber and Lyft or becoming a pet sitter. Other opportunities to earn passive income include affiliate marketing, blogging and podcasting. affiliatebusiness
The best part about starting a side hustle is that you’re at the helm. You get to decide how you want to measure success — whether it’s finances, feelings or social media metrics. When you’re in control, you’re more likely to stick with it through the ups and downs.
The more you put into your side hustle, the more you’ll get out of it. For that reason, it’s a good idea to treat it like any other project or task you have on your plate. Set aside dedicated time for your side hustle and commit to it regularly. It can take time to build a customer base, create an in-demand product or service and generate consistent revenue. But if you’re patient and committed, your hard work will pay off. The financial benefits can be huge – especially if you’re able to replace your day job with your side hustle.
Automate Your Savings
If you want to reach financial success, it’s important to set aside money for savings and other future expenses. However, it’s easy to let this task fall off your to-do list or to be swept up in the day-to-day activities of life and end up missing out on the rewards of being proactive about saving. Automating your savings can help you keep a regular habit of setting aside money for the long term without having to think about it or make the effort.
There are a few different ways to automate your savings, but the easiest is through direct deposit with your employer. You can request to have a specific amount of each paycheck automatically transferred into your savings or investment account, while the rest goes into your checking. Many banks also offer automated bill payments, which allows you to set up automatic withdrawals from your checking or savings account to pay a bill.
Another way to automate your savings is by creating a savings goal and setting up a recurring transfer. This helps to ensure that you’re consistently meeting your savings goals, even if you have to adjust your budget as your circumstances change. It’s a good idea to set up automated transfers into a dedicated savings account that’s separate from your checking or investment accounts. This will help you avoid the temptation to withdraw funds from these accounts for other purposes and potentially incur fees.
A final way to automate your savings is by linking your bank accounts and establishing an automatic money flow. This gives you the ability to route money where it needs to go — investing, paying bills, savings, and guilt-free spending. It’s a great way to keep your spending in check and build wealth over time.
As you consider these options, remember that it’s a journey that requires thoughtfulness and commitment. It’s important to identify your goals and personal motivators, so you can develop a wealth strategy that’s aligned with your audacious financial objectives. Keeping up with these smart money habits can give you the freedom to pursue your passions in life and achieve financial security.
Start Investing
One of the best ways to reach your financial goals is by investing. Investing is the process of buying and holding assets for the long term to help grow your wealth and meet your financial goals. It’s also one of the most effective ways to save for important long-term goals like retirement and paying for college. Unlike savings accounts, which only pay minimal interest, investments can earn you gains that will outpace inflation over time.
Investing is a great option for people of all ages, but it’s important to start early so your money has plenty of time to grow. You can choose to do it yourself, hire a financial advisor or even use a robo-advisor to help you with your investments. It’s also important to understand your personal risk tolerance and capacity to handle losses before you invest, especially if you’re new to investing.
The best way to get started is by opening a brokerage account. This is a taxable account that allows you to buy and sell stocks, ETFs (exchange-traded funds), bonds, mutual funds and more. There are many brokerage accounts that offer low minimum deposits, making it easy to get started.
Next, you’ll need to figure out how much to invest each month. It’s important to find an amount that works with your budget. It’s also a good idea to invest in multiple asset classes, which is called diversification. This can help reduce your overall investment risk.
Once you’ve figured out how much to invest, it’s time to put your plan into action! You can choose to invest all at once or spread it out over time, which is known as dollar cost averaging. Either way, just be sure to stick to your plan!
The financial decisions you make during your 20s can have a huge impact on your future. Discover is dedicated to bringing financial education into the classroom, helping young people gain a solid foundation for success. Explore our self-paced online modules, interactive capture sheets and other resources to empower you to take control of your financial future and set yourself up for a lifetime of prosperity.
Manage Your Credit
Managing your money and working toward financial success requires more than just making more income. You also need to ensure your money works for you by cultivating smart money habits that allow your hard-earned dollars to achieve their full potential. The key to this is budgeting, and Discover has an easy-to-use, free budgeting tool that will help you get started.
We’ve all heard the saying “Put your money to work” — but many people don’t know how to make their hard-earned dollars really earn them more. That’s why we created this free budgeting module. It helps you understand the costs and benefits of using cash, debit, credit cards, and other methods of payment. Plus, it teaches you how to analyze your spending habits so that you can think before you spend.
You’ll never reach your wealth goals if you don’t have any money left over after paying your bills. To start, calculate how much you bring in each month by adding up all of your income sources and subtracting all of your expenses. This will give you a baseline from which to grow your income and savings.
Once you’ve established a budget, focus on eliminating your debt as quickly as possible. It can feel like a daunting task, but it’s easier than you might think. We’ve compiled some tips for how to pay off your debt quickly and effectively here. Then, once you’re debt-free, you can start saving more and investing more — the ultimate goal on your path to financial freedom.