In Episode 002 of Pathways To Wealth, we're talking about the two best pathways for building income streams…
Did you know the average millionaire has 7+ income streams?
It might sound complicated, but the good news is every profitable income stream can fit into one of two categories… And in this episode I'm going to take a deep dive into each one, then look at 20+ ideas you could use to earn more money.
Also, don't forget to subscribe to the new iTunes podcast and YouTube channel so you don't miss future episodes!
In This Episode, You'll Learn:
- Why the middle class is evaporating, and why it's vital that you create more income streams
- The best two pathways for creating more income streams
- Why companies are hiring more freelancers and contractors and less full-time employees
- 20+ examples of income streams that you can create today
- Why everybody is going to be an entrepreneur in the near future
- The single most valuable skill that should be mandatory in schools
Links & Resources From This Episode:
- 51% of Americans earn less than $30,000 a year
- Freelancing websites – Elance, Upwork
- My latest angel investment – Aceable
- Subscribe to ChrisDunnTV YouTube Channel so you don't miss any video episodes
- Subscribe to the Pathways To Wealth Podcast on Itunes, Stitcher, and Soundcloud
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Chris Dunn: Hi and welcome to Pathways to Wealth. I’m your host Chris Dunn and in this episode, we’re going to be talking about the two best pathways for creating more income along with about 20 examples that fall under these categories to hopefully get your brainstorming working.
Now, before we dive into the Two Pathways for Creating More Income, I want to talk about why create more income?
It’s very rare that I meet somebody who says “Chris, I have all the money I need. I have all the income I need, my family is set. I have all the wealth I need, we’re good to go”.
I think less than a tenth of 1% of Americans are even close to being in that category. I’m speaking to the 99.9% of you that want more income.
The Truth About The Economy
Let’s just talk about the realities of the economy and the markets and without getting too geeked out here on stats. I’ll just give you the statistics that I think are the most important. Despite lower unemployment since the 2008 financial crisis, wages are not increasing at any kind of significant rate compared to inflation. Meaning that over the years, wages are barely, if at all, rising.
Why that’s important and just to put things into perspective, there was an article that recently came out that showed that 51% of Americans earn less than $30,000 a year. Now, I'm not going to run the stats in this episode but if you look at the cost of living in the major metropolitan areas across the nation, I don’t care where you are, any of the major metropolitan areas, you cannot survive and live a comfortable life at $30,000 a year. It’s impossible when you look at the cost of housing, when you look at the cost of health care, of education, and of food, it just doesn’t make sense.
I also recently saw another stat that said that about 40% of Americans can't afford a $2,000 emergency expense. So, if you have to go to the ER, if you have car trouble, if something happens with your house or a kid or a spouse, that’s about a half of Americans that can't afford a $2,000 expense.
To me, that just says there’s something really, really wrong in our economy. The cost of healthcare, housing, and education has been skyrocketing compared to inflation. Again, I'm not going to go too deep into the stats in this episode. I just want to set the stage for why I think it’s important that we have an open discussion about making more money.
With a lot of people, they have self-limiting beliefs that whenever somebody likes to talk about money, more income, entrepreneurship, or wealth, it almost becomes like this awkward topic. But as you probably know by now, that’s not the case with me at all. I love talking about this. I love entertaining the idea of building more wealth, creating more value, bringing amazing products and services to the world and just making the world a better place and enriching our lives because of that.
Looking at some other realities here, the reality of the economy that we’re in right now is that old school corporate jobs are evaporating. Sure, if you look at the government stats on unemployment, you can see the unemployment numbers have been going down pretty steadily over the past few years but a lot of people are underemployed.
This is the age of the college-educated barista, people with master’s degrees that are serving coffee at Starbucks. It’s just insane, the amount of people that have taken jobs just to survive and I think that’s why average wages haven’t risen.
This isn’t big corporations’ fault, this isn’t because of capitalism that is the problem, the problem is just the changing landscape. You have companies that are moving away from full-time employees into hiring more contractors and freelancers quite frankly because it costs about a third less than regular employees with benefits and overtime pay, and all the stuff that comes along with a full-time employee the additional expense.
We also have robots and outsources overseas that are replacing domestic full-time employees and I chuckle whenever I see the debate about minimum wage. You have everybody right now up in arms about $15 minimum wage, and I'm like, guys see the forest through the trees. The minimum wage is not the problem. It’s what people are actually doing with their time.
These people that are fighting for $15 minimum wage, they don’t understand that the higher cost for that entry level employee, the more incentivized those companies are to just automate that position and we’re already seeing that with the self-checkout counters and there’s a coffee shop that’s going nationwide with just automated coffee makers and checkout system, so soon the college-educated barista will be a thing of the past.
That’s the reality of the economy and where we are today and why it’s so important for you to focus on earning more income.
The Solution To Poverty
Now, let’s talk about the solution. What’s the fix to this? Well I think in the very near future and we’re actually already seeing this but virtually everybody is going to be an entrepreneur at some level. Now, when you think of the word entrepreneur, you might think of Mark Zuckerberg in Facebook or tech start-up founders or people that have created really large companies, and while that is one category of an entrepreneur, that’s just one category.
There’s a whole spectrum of what entrepreneur means. It could mean everything from a freelancer to a contractor to a start-up founder or to somebody who just owns a lifestyle business, a service business that serves them and their family and maybe they only have a few key employees.
What I think most people are going to move towards, and again, we’re already seeing the shift, is most people are going to have multiple employers. Think more along the lines of contractors. This goes for office workers, I think it’s going to go for everybody – nurses, construction workers and a lot of these people on a legal basis are already considered contractors, but I think it’s going to become more of a reputation-based employment.
If you look at websites like Elance and Upwork, people are already doing these online jobs like writing, administrative stuff, SEO, website development design, those are all contracted and freelance type work but I think that’s going to spill over into more traditional jobs.
What’s going to happen is you're going to have more freedom but that also comes with more responsibility and it’s going to require that our education system teaches kids from a very early age about entrepreneurship.
Unfortunately, when I was in school, we didn’t have any of that. But today, thanks to just the spread of the entrepreneur spirit and shows like Shark Tank, that message is getting out there and there are now K-12 programs actually here in Austin that I'm involved with that’s the first K-12 entrepreneurship track for kids and I think that’s great. What’s going to happen is if you're already in the workforce, you're going to need to educate yourself and become an entrepreneur in your mind first, develop the skills, and then that’s going to translate into your job.
The First Pathway To Creating Income – Solving Problems
Let’s talk about the two pathways for creating more income. There are really only two things that you can do. The first is develop a skill and the second is to solve a problem, that’s it. Every single way of creating more income falls under either developing a skill or creating more income. Let’s dive into some examples. Let’s talk about solving problems.
We’ll start here. Every major company that has gone on to do big things has solved a major problem.
If you think of Microsoft, Facebook, Whole Foods, Wal-Mart, all of these companies solved a problem and sometimes the problem was very obvious. Other times, the problem was less obvious.
Like Ford when he created the first car, he said, “If I would’ve listened to my customers, I would’ve built a better horse,” but instead, he built a better vehicle, a better auto, a better transportation device.
Let’s take Wal-Mart for example, with Wal-Mart, they were able to pull a ton of products into one location at a very, very low price. They solved the problem of sourcing goods from many, many different areas.
Now, as an entrepreneur or a solopreneur or whatever you want to consider yourself, you don’t have to solve a problem like that.
In fact, there are many different ways to solve problems.
My first business was a service business. I didn’t have a lot of capital. All I had was muscle, hustle, and grit. So what I did is I went out and detailed cars after school and on the weekend and through my effort, through my sweat equity, and my effort in building a reputation,
I was able to make more money than my teachers at my high school. That was just a way that shows you that if you have very little money, experience, whatever, there really is no excuse in today’s economy for struggling if you're willing to put in the work.
Another type of problem that you can solve is information products. I’ve made several million dollars over the years through information products at about 4 or 5 different niches.
The nice thing is if you have specialized knowledge or if you have a process and a framework for how to do something, knowledge is very valuable. Good knowledge is valuable. With the internet, knowledge is everywhere now and it’s become almost commoditized but if you have specialized knowledge that you can put into a framework, that can create a lot of value and solve problems for people.
The next is, real estate investing. I've done many many real estate deals over the past decade or 15 years and what I always tell people is if you want to get in real estate, you have to think about it as problem-solving, that’s where you create the margin. That’s where you create the profit. It’s not what these late night infomercial guys make it out to be where you just go out and you find cheap houses and you fix them up and flip them, that’s part of the process.
But the reality and to make that happen is you have to solve problems for people. You have to solve problems for motivated sellers, people that want to get out of their current situation or take over a property from an investor that failed at doing what they wanted to do and maybe create a creative solution for a home buyer to purchase your property without going through conventional financing and getting a mortgage.
The more creative you can get with real estate, the more money you can make. We’ll talk a lot about real estate and show you some examples and interview some extremely successful investors in the coming episodes.
The next option here is a SAAS product – software as a service. This has been huge the past decade. There was recently a company that I invested in here in Austin, Texas called Aceable and what they do is they’ve created an app for driver’s ed. Where kids used to have to go to a class and read this really, really boring book. Now they’ve put the whole course into a fun app for kids to go through and literally get their driver’s education on their iPhone and they are absolutely crushing the market because they’ve solved a big problem.
Another big problem and this is a market that I'm really, really interested in over the next couple of decades is healthcare. We have an again population. I can't remember how many thousands of baby boomers are retiring every single day, but with that, there’s going to be a wide range of opportunity for senior living facilities, not necessarily retirement homes but there could be even luxury senior living facilities and retirement places and just a whole market that comes along with that.
Biotech has been hot the past couple of years with new drugs coming onto the market. Those are obviously trying to solve major, major problems like cancer and heart disease and all of the major health issues that we have with a very unhealthy population and an aging population.
The Second Pathway To Creating Income – Developing A Skill
Alright. Step number two, in creating more income is developing a skill.
Let’s say you're sitting there and you say, “Chris, I don’t really know of a big problem that I can solve right away.” It’s not every day that everybody wakes up and says, “Hey, I have a cure for this” or “I have a solution for this.”
What is your other option? Well, anybody can develop a skill at any time that they want. Let’s just talk about some examples here.
Writing and administration, let’s say you are a good writer or you can learn how you can learn how to become a great article writer or blog writer or a reporter, what you can do is freelance and go on websites like
Elance and Upwork and all of the others that you basically post your work and you say this is what I'm willing to work for an hour or here’s my general cost for an article and if you become skilled at that, you can generate extra income just by developing that skill.
And the second thing here, and this is what I’ve actually told my own family, my close cousins that are in high school right now say, “Chris, if we’re going to do one thing to make a lot of money, what would you say?” And I would say, well, since you're in high school, the one skill that I think should be mandatory— and I think this is now starting to get the momentum going in the school system is programming —is computer science and learning HTML, CSS, PHP, Java, and all these languages that are, in my opinion, if not already are going to be just as important as mathematics, the English language, and just as important as learning another language like Spanish or Chinese.
If there was one skill, especially for young people, it would be programming and this is such a high demand job right now that if you're a hustler and you're willing to put in the work, you can earn a 6-figure income just by learning this. You don’t have to go to a 4-year college and get a degree that costs over a hundred thousand dollars. There are many websites online like Team Treehouse and there are just so many of that teach you everything from the very basics of coding all the way to the advanced stuff, so there’s so much information now that there’s really no excuse not to know this.
The third thing here is marketing.
Marketing is such a valuable, valuable skill that again, just like making more money is a taboo subject for people, sales and marketing, for whatever reason, it’s probably limiting beliefs, is such a taboo thing for a lot of people to think about.
Nobody likes to be sold. Nobody likes the door to door salesman that’s trying to sell them a vacuum cleaner. But marketing and sales is just a part of our everyday life. I don’t care if you're a corporate executive, if you're a PR person, HR person, if you run a grocery store, whatever, sales and marketing is a part of our daily lives and that is a skill that I think is the most valuable. If you can develop the skill of sales and really refine that craft, you can go to any state in the country or any country in the Western modern world and create a nice income for yourself.
The next one is day trading. Day trading in financial markets is something that I've been involved with for close to 15 years now and this is a market or a skill that has dramatically changed. The first time that I started trading was back in high school. I believe I was a junior in high school and whenever I had my detailing business, I went into a mortgage company one time and was basically pitching all of the loan officers to have me clean their cars and one of the guys was watching some interesting stock charts and movement on it and I said, “What are you doing?” He goes, “Well, I'm day trading.”
So I'm watched him for about 20 minutes and the guy made about, I think, $2300 in less than half an hour. I'm like, “Dude, I don’t know what you did, but I'm going to that.” So I spent the next few years learning and refining my craft and since then, the landscape for day traders has changed dramatically.
Now we have high-frequency trading algorithms and half of the financial market is run by computers but there are still great opportunities for skilled day traders. My wife is a full-time stock trader. That’s what she does for her income and she actually trades stocks all day.
So the next skill that you can develop is your celebrity asset. What does that mean? A lot of people look at celebrities on TV and on the internet and in movies and they think that people will just get lucky and they're thrown into those positions. But the reality is that developing your skill and your asset as a celebrity is something that you can create. If you want to start a blog and make a name for yourself, you want to start a YouTube channel and make a name for yourself, if you want to start your own show like I've done and if you have some value to provide to a market, that’s a very, very valuable skill that you can develop.
And the final is a deal maker. This is something that I like to pride myself that I've actually worked pretty hard at, is making and creating deals both in real estate and in business, and the power of negotiation – the power of being able to sit across the table from somebody and come up with a solution that’s a win-win.
Because I’ll tell you, if you think of yourself as a deal maker where you're just going to crush everybody, you're going to end up ruining your reputation and getting run over in the long term. But if you can learn how to craft deals that everybody profits and benefits from, it’s going to propel you exponentially further than just trying to do it on your own.
Alright, guys, now it’s time for a quick recap.
So far, we’ve talked about why it’s so important to think like an entrepreneur because your income and your livelihood literally depend on it.
In the changing landscape right now, with the middle class evaporating, with corporations and companies and not wanting to hire full-time employees but wanting to contract out and hire part-time employees and freelancers and with entrepreneurs becoming more and more wealthy while the people that are chasing a higher minimum wage wonder why they just keep getting pushed out.
The second thing is to focus on solving problems and developing skills. Those are two of the pathways to creating more income and in my opinion, the two major categories for creating wealth. In future episodes, we’re going to have deep dives and interviews with some incredibly successful entrepreneurs, investors, traders, innovators, authors, and coaches and we’ll really dive into the different ways that you can create income.
We touched on some high-level 30,000-foot overview stuff in this episode but in the coming episodes, we’re going to really talk about new and time-tested pathways for creating wealth and the first step in wealth is income. If you're struggling to survive, if you're struggling to eat, if you're struggling to pay your mortgage or rent, capital grown doesn’t matter. Time freedom doesn’t matter.
So step 1 is you have to get your own income right and then from there you can worry about growing wealth. So I hope you’ve enjoyed this episode of pathways to wealth.
Don’t forget to subscribe to the podcast, and also, you can watch the video versions of this show and subscribe to our YouTube channel at Chris Dunn TV, and also, you can get the show notes and many, many resources at ChrisDunn.com.
Thanks again guys, have a great one, and I will see you on the next episode.