What is your backup plan for income?
No job is safe these days, no matter how important you are or how secure you feel. Even the Prime Minister wasn't safe. Business, can be very risky, things can happen and it could all be taken away tomorrow. What is your backup plan for income?
Jef Lippiatt ,
Owner at Startup Chucktown
Risk can not be completely eliminated. It can only be mitigated. As entrepreneurs we should be hyper-aware that risk is a constant as well as a variable. Consider that without risk there is no need to be an entrepreneur, but being an entrepreneur carries its own risks.
This is truly a loaded question. Steven diversification above and he is correct, but that needs to be seen in more detail (I'll circle back on this below).
Richard you have made some interesting suggestions, but they have risk as well. Take Intellectual Property, sure there is a reasonable expectation on return, but consider the cost to achieve the IP, just because you've secured IP doesn't mean it creates a product people want or need. Even if it leads to a product people want, it won't last indefinitely. The same is true of writing and selling a book. What if you spend all that time and money creating the book and no one buys it? What if the book sells well for a while, is that rate of sales sustainable? There is still risk involved.
Diversification is the only way to truly minimize risk. I speak of true diversification, not in the sense of a Monetary Portfolio. This is what successful diversification looks like to me:
The primary job is consulting. This leads to an offshoot of paid speaking engagements. The added visibility leads to writing and selling a book (while still consulting and doing speaking engagements). The book surfaces the opportunity to do training workshops (helping others gain your skills not applying your skills to clients, but still doing all of the above). The added projects have brought additional revenue. You decide to invest your extra revenue. You split your investments across Stocks, Bonds and Cash. You continue doing all of the above and decide you want to buy part or all of a related business but leave them to operate on your own. Now that you have all that going you realize you don't have as much time to do all of the above, so you cut back on training and open up an e-commerce store to sell whitepapers, training guides (CDs/DVDs) and other related material.
This could continue on and on. The idea is that you are truly diversified. Sell services, digital products, physical products and be in different industries and verticals so that lows in one market are offset by another.
I will say it again, risk can not be eliminated. It can only be minimized. The biggest risk is not taking any. Life is always changing so you must plan to adapt constantly.
Richard Schembri ,
Entrepreneur - Team Coach and Mentor in Network Marketing at Team Berrygood
Some good ideas here so far guys, but I feel that all the answers so far have an element of risk as well that could potentially leave you without an income. I feel that when one has a secure job, position or business. One need to create multiple income streams (as you have stated) however these income streams need to be in a part time opportunity where you can create residual income without huge risk. This way, you will keep getting paid regardless of how much you work on it or if at all. That way if you did lose your main income source, you would be ok until you replaced it.
Such ideas would be Intellectual Property (an invention perhaps), write and sell a book, create a APP, network marketing and more.
Upskill, side skill, and diversify is the nutshell of survival.
The dole? Bar work?
I think my backup plan for income is living very frugally. The amount my family and I live on at the moment means I could do just about any job in the world and we'd still be able to manage!
Ling Lee ,
at Digital Marketing and Personal Branding
eBay business! Cheap, fast, and easy!