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Financial Strategies and Multiple Streams of Income

Social Media Sept Wk 2 1 300x300When creating multiple streams of income, most people focus on revenue only. In other words, "How much can I earn?" And many of them miss the mark and create distractions and money drains instead.

Having multiple streams of income is important. Wisdom directs us to prepare for uncertainties of life or do not put all of our eggs in one basket (Ecclesiastes 11:1-2 NIV).

Just as important, we need to know the cost of multiple streams of income (Luke 14:28-34 NIV). Creating multiple streams of income doesn't mean any stream of income will do.

What's better revenue or profit?

There is a difference between profit and revenue, although you can't have profit without revenue. Revenue is what we earn before costs, spending, taxes, saving, investments, retained earnings and other. Profit is what is left over after costs, spending, taxes, saving, investments, retained earnings and other.

Many people delay or fail at business growth because they focus only on what is coming in instead of what is going out. Profit is what's left over. You have the power to adjust profit by more than just increasing prices.

Millionaire Mistakes

Most millionaires are estimated to go bankrupt 3.5 times before they are successful. The world says this is normal because failure comes with success. I believe success comes with Holy guidance, strategy, patience, motivation, ups and downs, testing, improvement, wise stewardship, and determination. But the real reason for the bankruptcy is too much debt and not enough income. Most millionaires tried to create too many businesses at once and by using debt.

Return on Investment Takes Time- Ecclesiastes 11:1 NIV

The average business takes 2-5 years to earn a profit. That does not mean just earning money but to earn a profit. The best way to control profit is to have money management skills. How you manage your money will determine the amount of money you have to reinvest back into the business. In accounting terms, this is retained earnings.

Because most people strive to have $0 profit so they can have $0 taxes they end up without the money to expand and their response is to use debt. Debt is like driving a boat with a hole in the side. You will not get very far as the mounting debt begins to weigh your business down.

Take Action

So this week visualize how can you earn additional revenue streams AND what costs are associated with those revenue streams? Include the amount of time it will take to develop the new product or deliver the service.

Example #1: A daycare owner operating at 1st shift may add a second shift. 2 streams of income (only the same cost are associated)

Example #2: A website designer may create additional design ideas such as designing logos and marketing materials. 3 streams of income. (No or low additional cost.)

Example #3: Most coaches also speak, sell products, write and sell books, write blogs for money. 5 streams of income. (speaking, printing, product costs can vary.)

Review and count the cost of income streams within your primary business. Once your first business makes a stable profit without debt you are ready to invest in a different venture.

Financial Strategies and Multiple Streams of Income {Video}. No transcript includes

additional tips to assist the everyday Christian business owners and entrepreneur.

Y. Michelle Coard, B.A.S, A.A.S, Accountant and Profit Strategist.
Y. Michelle Coard, B.A.S, A.A.S, Accountant, and Profit Strategist.

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