How I Built an Extra Income Stream online
Who wants to make more money???
Extra income allows you to pay for extra expenses, treat your family to memorable holidays, save up for the purchase of your first house or apartment, buy toys for the big boys, help others in need, etc.
People work extra long and hard to earn more money and save a portion to afford these things. Some sacrifice their day off to work, some spend 12–16 hours in the office, and there are those who don’t use their vacation leaves because they don’t get paid when they take time off.
This is fine if you’re young, hungry, and single, but as you grow older and family commitments start to catch up to you, spending most of your days at work will burn you out and might cause your physical and mental health to suffer.
But how else can you make money?
We’ve all heard how investing is better than saving your money, right? So how does this work, especially if you’re not into business and know nothing about making money?
Before you think about investing, there’s one thing you need to know: one thing in common among rich and successful people in business is they are all excellent money managers.
And if you want to make more money, you have to take ownership of your earnings and learn how to manage your money first.
The good news is, anyone can be a good money manager, including you. You don’t have to have a business or finance degree. As a matter of fact, most business owners that I know (chiropractors, school owners, commercial space owners, restaurant owners) didn’t study any of these subjects in school.
But you need a framework that will help you build good money management habits that will help you make more money.
Here’s one simple method that my wife and I have been following:
The 6-Jars Method to Budget Your Money
I used to suck at budgeting so I decided to educate myself.
I attended The Secrets of the Millionaire Mind seminar, a three-day event with head trainer Robert Riopel, which teaches the principles from author and businessman T. Harv Eker’s book of the same name.
The main takeaway from the three-day event is this: if you can’t control your money, your money will take control of you. And in order to make more money, you first have to learn how to take control, which is why a budgeting system has to be in place. This does a couple of things…
- It allows you to track how much money you have left to spend and protects you from unnecessary overspending.
- More importantly, it shifts your mindset from spending money to investing and making money
How does it work?
When you get your salary (minus tax), divide your money into six jars (or envelopes, like what I did). This is how it should look:
1st jar: Financial Freedom Account (FFA) — 10%
2nd jar: Long term savings for Spending account (LTSS)- 10%
3rd jar: Education account — 10% (this will be key later)
4th jar: Fun account — 10%
5th jar: Necessities account — 55%
6th jar: Give account — 5% (or ten percent if you follow tithing; take the other 5% from your necessities account)
(note: if you’re married, combine your salaries, take a small amount that should be distributed evenly to both husband and wife, and divide the rest into the jars)
Here’s how it would look:
Husband: $4000 Wife: $5000 Total Income: $9000
Give $500 each to the husband and wife (this is their own money to spend for the month) and they are left with $8000 to place in jars.
FFA — $800
LTSS — $800
Education or EDUC — $800
Fun — $800
Necessities — $4400
Give — $400
FFA — This is your golden goose. This is the first jar you put money into when you divide your salary because you want to “pay yourself first.” You never spend the money on this account. You only use it if you will spend it on something that will make you money (investment). Never leave this jar empty because you don’t want to kill your golden goose.
LTSS — This is where you get money if you’re saving for something like a house, a new TV, a new car, a new phone, etc. You can also take money from here if there are unexpected expenses like car repairs, birthday presents, etc.
EDUC — This is where you get the money to pay for seminars, books, or courses that will teach you how to make money. If you want to go back to school, use the money in this account to pay for your tuition.
Fun — This jar is for treating yourself because you don’t want to skimp on yourself too much and you want to reward your efforts for managing your money.
You want to use this money to eat in a nice restaurant, enjoy a bottle of fine wine, or check into a nice hotel, etc.
When you just save, save, save, you neglect to feed your inner free spirit (the one who wants to have fun) and this could grow into a monster that might eventually come out and sabotage what you’ve been working on (like overspending your savings on unnecessary stuff).
On the other hand, when you just spend, spend, spend, there’s a part of you that feels guilty and wants to save instead.
The purpose of the Fun jar is to bring balance to your spending habits.
Necessities — This is your rent, gas, house and car loans, electricity, school bills, etc.
Give — Why do you need to give money in order to make more money?
Because it’s good karma.
It’s your declaration to the universe that you have enough money and that you can give to others who are in need.
It’s your mindset shifting from a lacking mindset to a mindset of abundance and knowing that you can make more money.
The universe, in return, will send more money your way (there’s no scientific explanation to this, but it does happen).
Rules of the Jars
- Don’t transfer money from one jar to the other if a jar is already empty.
Example: Your Fun account is empty but you want to eat in a fancy restaurant again. Don’t get money from your other accounts just to satisfy this craving. This means that you can’t afford to blow your money in a restaurant, and you’ll have to wait until your fun account is topped up first (either wait for your pay or make more money by selling something or by providing a freelance service).
NOTE: Seeing an empty fun jar is a concrete way to explain to someone that they can’t afford something.
SECOND NOTE: Even if you blow away the money for the other jars, you’ll still feel good about yourself because you know that you still have money left in at least one jar, your FFA.
THIRD NOTE: I had money left in two jars (or envelopes) each month because I never spent my EDUC jar either and I used it strictly to buy books or courses only.
2. If you find that your necessities account does not cover all of your expenses, do these two things: a) make more money, or b) start cutting your expenses.
Example: Think of where you can save money. If you pay a gym membership every month but don’t actually go, terminate it! The same if you have a Netflix subscription but you don’t watch.
Do you really need that boat or that RV? Maybe you can rent instead if you don’t use it all the time.
Can you negotiate a better deal from your phone and internet provider? Call them and ask! If you don’t, the answer is always no.
Is there an extra room in your house or apartment that you can rent out to make more money?
Do you have any clothes, used furniture, or used appliances that you’re not using anymore that you can sell?
Is there a service you can provide (like maybe renting out your carpet cleaner)? Or maybe drive an UBER?
Our brain is amazing. Approximately 60,000 thoughts go through our mind every single day! If you focus your mind on things that you want (making money, saving money), your mind will begin to filter the information and make the resources that you need available to you.
3. If you feel that it’s not fair for one person to put more money in the jars because they’re earning more, remember that money is only one part of your relationship.
While it’s true that they are contributing more money, the other person could be contributing more to the other aspects of their married life, like taking care of the household chores, looking after the health of all the family members, doing minor renovations in the house by themselves to save money, etc.
My First Attempt at Making Money
As I got better at managing my money, one thing was hard to deny: my EDUC and FFA Accounts grew fast.
I would always blow away the money in other accounts but not my FFA and EDUC.
They grew so much, up to the point that it was not viable to keep them in envelopes any longer. I could see the envelopes getting thicker and thicker as I put cash in them every month (there is nothing more satisfying than seeing your progress in physical manifestation as the envelopes grow).
At some point, I had to do something with the money, right? After all, I want my money to work for me and make more.
So I invested.
My first attempt at making money online was on a blog and an MLM company selling dried moringa leaves supplement (SPOILER: it didn’t go well).
I used my money in my FFA and bought a domain name, a hosting plan, website themes, and paid for the MLM products I was going to sell.
I published less than 10 blog posts and soon realized that not only was it hard to drive traffic to a new website, but my writing sucked big time!
I had a website with a product to sell but no traffic, no readers, no engagement, nothing. So I had to shelve my blogging plans after about a year.
My attempt to sell the MLM product through my blog went down the drain with it.
Needless to say, I blew most of my FFA on a flop.
But it’s alright. I learned something valuable though. I realized there was one thing that I didn’t have which could prove to be valuable: writing skills.
If you want to make more money, you’ll have to invest in educating yourself on the business you want to get into. So I did the next best thing and invested in building writing skills that would make me money eventually.
My Second Attempt to Make Money
I used the remaining money in my education account to pay for a Content Marketing Course and a Guest Blogging course to learn how to write.
The plan was to become a better writer, do freelance writing, build a network and following online, and eventually, build my own blog and venture into affiliate marketing.
After I finished my Content Marketing Course, I started applying for freelance work, which I can do in my spare time and earn extra money on top of my day job.
I started earning money when I began writing on online platforms. I write online to practice what I learned in the courses, sharpen my skills, and to expand my writing portfolio. The more I published, the better I got, the more people read my posts, and the more I got paid.
I’ve been writing on online platforms for about two months, I’m having fun talking about my personal experience with weight loss while earning money at the same time. How awesome is that?
About two months after I started earning money writing on online platforms, I got my first client! He wanted me to write a 3000-word post for him which sort of serves as a “try-out” (he wants someone to regularly write on his site so I’m keeping my fingers crossed that I get the projects).
I have another lead that was recommended to me by another content writer, we’ll see how that goes too.
The money that I earn from my writing is again placed in the jars as well, regardless of the amount. And when I’m already earning enough money to replace the income from my day job, it will be time to leave and focus on writing full time.
I still want to start my own website where I can sell affiliate products.
I probably need to enroll in one or two more courses to help me improve my writing.
And when that time comes, I’ll need money to cover the expenses, but I’m confident that I’ll have enough funds in my jars because I’ve learned how to make (and invest) money.
Final Thoughts
Apart from being able to budget my money better, the jars shifted my mindset into abundance and making money instead of scarcity.
I learned how to make money work for me.
For the first time in my life, I am getting paid outside of my job by writing on online platforms and thru content marketing.
My next business ventures are within reach.
I’m not earning five figures a month on my writing alone; I’m far from it. But I know that I’m moving in the right direction, and I’ve earned more money in two months from a side hustle than I have in the past seven years. If I stay consistent and keep improving and working, anything can happen.
And all of these are possible because I learned how to manage my money first.
You too can enjoy these benefits if you learn how to take control of money. Try the six jars system and watch as your money grows.