MoneyMinding Monitor

A question from a freelancer looking for comments from money experts generated this response from Tracy: 

One of the main reasons people struggle with money is that they have lost sight of the fact that they are responsible for earning their own income.  When you limit the way you earn income to a job where an employer determines your income you could have recession issues with your income if your employer has you on a fixed wage, while expenses around you are increasing. Many people who teach about money talk about the advantages of “multiple streams of income”; and many people who buy into this teaching will think that to protect their income they need to add a second job, or start a ‘small part-time business’, or start to invest in real estate or the stock market.  While these things are all good ideas for additional sources of money, especially if you depend on wages from employment where job security is beyond your control – it’s critical to first have a plan for how much income you need to live the life you want to live. Having “multiple streams of income” can turn into “multiple streams of lack of focus”, if you don’t first know what you want and how much it’s going to cost on a monthly basis.   For example, if you know that your ideal monthly budget is $4000 a month, then you strategically implement income plans to meet that goal.  You might have a job that pays $3000, and rent a room in your home for $500 and teach piano lessons on the weekend for $500.   The way you recession proof your income is to learn how to earn income from your own efforts.  And the reason this is an issue is because learning how to earn income has become a lost art, that is now predominately all focused on how to get more from your job.  As an employer myself, I prefer to know that my employees have goals and incentives that allow them to reach their goals as opposed to struggling with money and the added stress that negatively affects their performance.  You do not have to become an investment expert or business person – you need to figure out what you enjoy, what assets you have besides just the dollars and cents on your net worth statement and you start asking HOW you can earn income from all that.   Hey, Colonel Sanders was in his late 60’s when he took his chicken recipe to restaurants which eventually become Kentucky Fried Chicken.  Anyone can do that – sadly, very few will.  However, it all starts with a personal goal that has a dollar figure attached to it.