How to Increase Your Income
We talked with four local professionals who are using different strategies to increase their personal and professional income and build wealth. Here is what they had to say...
One of the best and least talked about ways to build wealth is through the creation of multiple income streams. More income however, does not translate directly to wealth. As your income increases, it is important to continue to be mindful of spending practices and retain frugality to ensure you don’t spend the new money you’re working hard to pocket.
The key is to not only create and build wealth, but to maintain it. You maintain your wealth by being financially defensive, frugal, and displaying social indifference in being discriminate in what you choose and do not choose to spend your money on.
Jeff Woody
Co-Owner of North Ankeny CrossFit & Goldfinch Athletics
Jeff Woody, co-owner of Goldfinch Athletics, and his business partner started their careers working for Acceleration Iowa, a sports performance program for youth athletes. It took time, but they no longer work for this company, they own it and significantly have expanded its reach to two locations offering CrossFit and youth programming.
They weren’t about to stop there though, these owners are also currently in contract to operate their sports performance offerings at two additional sites in the area.
In addition to successful business acquisition and expansion, they have also acquired the commercial real estate facility in Ankeny that their business resides in, creating additional income and equity building on top of that which they receive as business owners. The addition of their commercial real estate property increases diversification in their financial strategy, both personally and professionally.
Here are Jeff’s best tips:·
1) Quick money is trash money – Money, income, and wealth take time to build. Money that is quick is generally not sustainable or safe. You may gain $50 by forcibly up-charging a client a service they don't want/need, but people hate being milked for money, so if that person hates it and leaves, you've lost thousands in the long-term value of that client for the sake of $50. It takes time to build your wealth and nothing ever comes as easily as "gurus" say it will. Be patient, consistent, and diligent in working towards your long-term goals.
2) The world does not revolve around you – As humans, we have the tendency to think everything revolves around us. Not true. Remember that you’re part of a bigger picture and don’t be scared to take risks or say or do the wrong thing because at the end of the day, people have more to worry about than the things you did or said. People think that other people are thinking all kinds of negative things about them. That's not true. People aren't usually thinking about you at all! This can make some people scared, but when you turn that on its head, it frees you to try something that may or may not work because you know people won't even remember those mistakes.
3) Don’t be a dick - You’d be amazed at the relationships you will build and the opportunities that will unfold simply by being someone who is both reliable and kind. Treat people with respect, show them kindness, and offer others help and support. Simple manners and gratitude will present opportunities you couldn’t otherwise imagine.
When asked, what would you tell someone who is scared to invest or scale their business Jeff notes two things:
1) Get your own personal financial house in order. When you make bad personal decisions, you then need the business to fund those stupid decisions, which means you aren't doing what the business needs, you're only doing what you need.
2) No one cares! Scary as that may seem, there is a huge freedom in knowing that you can take chances and fail, just to take more chances and fail. But to flip that around, people start to care when you make their lives better (or worse, so don't do that). So try and make someone's life a little better. If it doesn't work, try again! And if that doesn't work, try again! Eventually, you're going to find something you love doing that also makes people's lives better. And if you're making a living by improving the world, how much better can life ever get?
Penny Schmidt
Financial Advisor at Iron Horse Wealth Management
Penny Schmidt is a Financial Advisor at Iron Horse Wealth Management. She serves as a fiduciary which means she is required to manage her client's assets and give advice that is in the client's best interest. Penny shares that market investing is a great opportunity to build wealth, and extra income can be created by the acquisition of stocks which pay dividends.
A dividend is a payout an individual receives for owning a share of a company. A dividend can be reinvested through what’s known as a DRIP (Dividend Reinvestment Plan). It can also be a cash payout to the stockholder. Stock or mutual fund investments tend to increase in value over time. There is the downside that the stockholder will pay taxes on the dividend income, regardless if they are cashed out or reinvested.
When asked what she would tell someone who is scared to invest, Penny jokes, "What’s your other alternative?"
Penny notes that it’s always nice to save and hold money in savings or money market accounts. However, that money is not keeping up with inflation and it will lose purchasing power overtime. 10k under your mattress will be 10k in 20 years but in 20 years, 10k will not buy the same amount of goods/services as it will today due to inflation.
Jenn Lee
Small Business Owner, Photographer
Jenn is the queen of side gigs and earning extra income. When Jenn wanted to get into her first home as a single parent, she knew that she wanted her cake and to eat it too - meaning she wanted her ideal home and to be financially comfortable. In order to do that, she looked at opportunities to increase her income.
An advertisement at her son’s school offered to pay crossing guards $350-$500 per month. She was already helping her son make the trek to school each day, so why not get paid in the process? She also continued her side hustle photography business, taking on new clients, plus spent more time creating and designing notepads for a second side business she co-owns with her mom, The Writing Pad Co. Throw in a few Amazon Flex delivery blocks as well, and she was creatively earning extra income from a variety of places.
When asked – What would you tell someone who is scared to start a side gig? Jenn said – Just do it. You’re not out anything except maybe some time and effort. You can truly make money in so many different ways, you just have to be brave enough to try. And if you fail? So what. You didn’t actually fail at all, you will have earned new experiences, met new people, and learned for next time.
Jake Escher & Jayce Pedro
Realtors; Quartz Team
Jake Escher and Jayce Pedro independently and collectively own 13 investment properties at the young ages of 24 and 25. They boast that real estate is one of the best ways that they have seen people safely increase their income and build their wealth. They argue that real estate makes money in multiple ways which is why it is such a powerful tool to grow wealth:
1) Real estate appreciates, meaning it grows in value overtime.
2) Real estate provides cash flow providing a direct payout from simply owning and renting a property to others. Once the expenses of a property are accounted for, the rental income is enough to generate passive income to the property owner which can either be paid out directly or saved and reinvested.
3) Real estate, from a tax perspective, depreciates. The government cannot reasonably provide everyone with housing and so there are incentives to real estate owners who rent their properties and provide housing to others. From a tax perspective their properties depreciate on paper, however, appreciate in market value.
Even in the face of what would appear to be catastrophe, real estate can still be a sound investment. Jake and Jayce recently had a property damaged by fire and other properties damaged from hail. Due to strong insurance policies they will be able to leverage insurance claims to replace the properties and/or their attributes making their investments more valuable.
When asked – What would you tell someone who is scared to start investing in real estate Jayce and Jake note "It might seem like a lot to begin with and more you can take on, only to find out you should have started sooner.
Initiate conversations with professional investors, talk with realtors who specialize in real estate investing, and begin educating yourself. You'll likely find that the more educated you become in real estate investing the less fearful and more confident you'll become in its ability to grow wealth".
Ready to Increase YOUR Income?
If you’re ready to increase your income, know that there are an infinite number of ways that you can begin to do so whether you have money to invest or are newly starting. Developing financial intelligence means polishing your ability to look for new and innovative ideas and opportunities to improve your financial outcomes and grow your wealth.
If you’re interested in learning how to increase your income, Breakthrough Innovation offers coaching opportunities to help you do just that! Consultations are free, so what are you waiting for?
We have just three spots open for coaching in June. Hurry and grab your spot!