Multiple Income Stream and Property Investment

When talk about wealth creation, people talk about multiple income streams. It means the more ways to generate income, the more wealth you can accumulate. For a layman, the more works you do, the more money you can have. For a middle and below workers, this can easily be done by working overtime. Some companies may offer more allowance if you are willing to do more work at a time. For example, as a lecturer beside my main responsibility to teach the students, I can also opt to teach part time students on each semester. In some multi-national companies, engineers are rewarded by doing more work per week.

Young labour force should focus on their permanent work. To get more income, they should spend more hours to learn the trick of trade in the field rather than doing other things in parallel such as Multi-Level-Marketing or MLM. Some people beside having the permanent job, they do another part time job such as being a part time tutor or part time business. We only have two hands, two legs and one brain to do our work. Thus, it is much easier to focus on one job especially if it is a new job. You should learn from more experience workers so that you can increase efficiency and productivity. Sometime, you should also learn something beyond your official job scope so that these knowledge can be used in the future.

However, we must always ask ourselves does the work we do really give us more income or is it a diminishing income? In economy term, it is call diminishing return. It means over time, although the amount of the work being done is the same, the amount you get paid is less than what you expected. But, most people are trapped with the amount they see. They forget to factor in the inflation rate! I was paid for RM4,500 per semester in 2000 for teaching part time students. Guess what?! The rate is still the same until now!

Thus, it is not productive to continuously teaching part time students. But, this does not mean it should not be done at all. Some additional works should only be done for a specific target. For example, to buy a new home in 2000, I have to work part time for the next 5 years. But, once my salary has increased over the years, I have no problem to pay the bank loan even though I did not teach part time students. In fact, I stopped teaching part time students after 2004. Stopping part time students also give me more time and energy to focus on my R&D activities.

We must always look for jobs which give higher return in present and future. We should ask ourselves can our job easily be done by someone else? If yes, it means competitors can easily appear and thus our worth is easily diminish! If the work is specialized and very hard to learn, we can survive as long as we love the work. Another example, when I graduated, I sold PCs which can give me a profit about RM800 per PC. However, after five years, a PC can give me a profit less than RM100. Thus, I shifted my focus from selling a PC to do machinery maintenance and design work. Since both are also my hobbies, I have no problem to put extra effort to learn (see Turn Your Hobby to Income). I don't mean selling a PC is bad. It is just a diminishing return activity for me and thus not profitable for me anymore.

It is unsustainable to do multi-works at the same time forever or until you retire. However, each additional work either part time or small business should come with a medium term target such as accumulating capital for investment. Once the target is achieved, stop do the work for one or two years. You should take a break in order to avoid burn out. Besides, doing the same thing for more than 5 years is counter productive. However, not many people are willing to change permanent job every 5 years. Instead, the part-time job or business should be changed.