Because of the financial risks involved with relying on a job for all of your incoming cash, it is critical to consider having at least one additional source of income. ... Here are five simple reasons why building multiple streams of income is so important.
Rising Health Care Costs
Whether you are in favor of the health care reform or not, chances are you are feeling the pinch of higher health care costs. Adding an extra income source can go a long way in paying for things like higher prescription costs and unexpected medical costs.
Unemployment How safe is your job?
Let's face it, no job is really ever safe, especially in a tough recession. Having other sources of income can help you deal with a job loss much easier than being caught off guard. Even if your other sources of cash can't cover all of your monthly expenses, it can still give you time to figure things out.
Paying for College
How much are you saving for your kids college? Instead of putting your retirement at risk by saving up for your child's secondary education, why not create an alternative income stream to help out. Having multiple streams of income bringing in cash every month can help ease the burden of paying for college.
Living Within Your Means
In order to build true wealth, you must be able to live within your means. If it is impossible to cut your spending any further, or you just don't want to sacrifice anymore—create a new source of money. There are only two ways to live within your means -- either spend less or make more money.
Pay Down Debt Paying
off your mortgage, vehicle, or credit cards is a great use for an extra income stream. If you can avoid paying tons of interest on a loan by making extra payments on existing debt, then you could be on your way to financial freedom.