I bet you’ve often heard that the
average millionaire has an average of seven streams of income constantly
flowing into their pocket but if you didn’t you’re welcome
however the average person has only one stream of income which almost don’t
waste happens to be their job while your grandparents maybe have been able to
survive on only one income source in the past years it’s nearly impossible in the
times we’re living in now in today’s video we’ll be sharing with you the
seven types of income the average millionaires have and give you tips on
how you too can have them but right before we begin if you’re not subscribed
to our channel you’re missing out big-time
tap the subscribe button and the bell notification icon so you don’t miss any
of our videos now let’s begin number one earned income earned income is money
earn from working or by spending time on a project this could be earnings from
your job salary from working for someone or contract payments it also happens to
be the most common source of income all in all earned income happens to be the
base of all self-made millionaires these earnings give them the boost they need
to pursue other income streams which we discussed later while sustaining their
lives you’ll find that most millionaires are CEOs in multiple companies which
doesn’t necessarily mean they own the company but instead are employed to work
in that role as for the regular person’s earned income could be from your job or
even from freelancing always keep in mind that job refers to just over broke
meaning what you can earn from them is only enough for your bills and to keep
you afloat there’s also a maximum on what you can make from jobs as they
depend on individual capacity for example we only have 24 hours a day if
you get a job with a maximum wage rate of $30 an hour working ten hours a day
you can only earn 300 dollars there’s no possible way of getting more than 24
hours a day to work and increase your income get what I mean
this sort of income is limiting in time and capacity you won’t be able to
increase your output as one person because you can only do so much in a day
also this income source tends to be the highest tax with an average tax rate of
40% in the u.s. meaning almost half of your income will go to the government
yikes most people settle with their jobs and their wages create a comfort zone
which holds them back from their full
potential once the comfort zone is created they settle for their paycheck
and anything that surpasses that will be paid by their credit cards thus creating
more problems it’s almost impossible to become a millionaire from just your job
paycheck unless you invest wisely and acquire the other income streams we will
share with you in a minute number two profit income this refers to
earnings acquired from selling a good or service for more money than it costs to
make it this can either be at wholesale retail distribution or manufacturer
level for goods today it’s so easy to create this channel of income with the
tools available online you could start off with a small investment or large
amounts of capital depending on the available funds this income stream
requires one to adopt the entrepreneurial mindset at first it may
be time consuming before you get the grasp of it all but with time it’s well
rewarding whether you choose to do it online or physically profits as an
income stream can really boost your earnings and make you a millionaire
within a short time however this happens to be risky and making the wrong move
can create many losses to avoid this ensure you do a lot of research on the
products or services you want to sell hire expert consultants to guide you
through the product development marketing and finally ensure funds are
managed accordingly especially within the first year they
say most businesses closed down within the first year of operations one of the
main reasons behind this is due to poor financial management use apps or even
hire a proper accountant or financial manager if the capital is available to
ensure this doesn’t happen to you for many people profit income and earned
income happens to be the only sources of earnings that they know they tend to
forget that there are other five viable streams that can earn them some serious
money I hope you’re taking notes let’s proceed shall we
number three interest income now this isn’t a common income stream but again
millionaires aren’t so common this earning comes from lending money in
exchange of some interest this could be by saving money in the bank through
Treasury bills given to the government or by lending someone money which we do
not really recommend it happens to be one of the most secure income streams
but it comes with a catch because the return rate is also the lowest the
interest rate could be between one and five percent making it the least
attractive however don’t dismiss just yet this income source doesn’t need
you to be actively involved in the investment which makes it a great
passive income source it also happens to be the least risky most people doubt
this income stream but when you do consider the power of compounding and
the fact that it really doesn’t need you to do anything it can easily beat the
first two income streams discussed above it’s also the least involving channel of
making money and one of the most secure number four dividend incomes now it’s
about to get really interesting this is one of the best income streams one
because it’s passive and it also makes the participant aka you a shareholder of
the company so how does it work when you buy some shares the company assigns them
to you and gives you the shareholder tag a shareholder is a co-owner of a company
depending on the company’s policies you’ll be paid in dividends either
quarterly or yearly dividends can be defined as the percentage of returns
earned from the shares of a company now here’s the best part you can end up
paying zero tax on this income how do you do that well if your ordinary income
is less than thirty eight thousand six hundred dollars a year you qualify for
zero taxes on your dividend earnings if you earn however more than four hundred
and twenty five thousand eight hundred dollars a year your tax rate is about
twenty percent which is still much lower than tax from earned income which also
happens to be among the lowest tax rates as good as it sounds it’s really
underrated and often ignored by investing smartly on blue chip companies
you could easily earn so much money considering you’ll also earn from the
capital gains of the share price this right here has to be one of the best
ways to generate a healthy cash inflow and becoming a millionaire but let’s
first go through all the streams so you can see what best suits you number five
rental income this is the income acquired by renting out an asset owned
this could be office space parking space a home or even a whole building the
property rented could be commercial or residential a few years ago venturing
into this sort of investment required massive investments in capital back then
you would need to buy a house or an apartment for you to lease it out for
income however today people are making millions of dollars by leasing homes
then releasing them on platforms like Airbnb or booking.com
all you need is an agreement with the owner of the home
while this can only be duplicated on residential properties I believe that
very soon with increased innovations in this space it will be possible to earn
rental income from other property types this is one great way to add some zeros
to your bank account number six capital gains this income is also quite popular
compared to the rest on this list it is the income generated as a result of
increment of value of the owned assets for example if you buy shares at $100
each and after a couple of months you sell the same shares for one hundred and
twenty dollars the capital gains is twenty dollars or you buy a house for
let’s say forty thousand dollars and sell it five years later for nine
hundred and fifty thousand dollars the capital gains there would be four
hundred and fifty thousand dollars the most common types of capital gains are
stocks and real estate property but there are several other assets that can
earn you this income the best part about this income stream is that the tax rates
are relatively low you could pay as low as 10 to 20 percent in taxes from income
generated this way depending on the amount earned in some cases this tax
could go as low as 0 with this stream of income you increase your net worth while
at the same time paying the least legal amount in taxes if this isn’t a great
way to become rich I don’t know what is number 7 royalty income this is the
income source that clearly defines what passive income is all about the earnings
are made even after one’s work is done to generate this sort of income you’ll
have to create a unique product a concept or a process which will later be
used by other people at a fee by letting other people use your creations they do
the hard work and pay back a small percentage of their earnings to you for
example an artist whose music is streaming on Spotify will earn some
royalties at the end of a given period based on how much his music is played
today venture capitalists earning through this channel a lot if you want
Shark Tank and other business pitching series you’ll notice most deals end with
a royalty price on each commodity sold another example applies to franchises
for example if you open a Subway franchise you will pay in some royalties
yearly we’re using their marketing strategies processes and logo writers
get paid for every book sold by publishers another great example is JK
Rowling’s earnings on the Harry Potter series she gets paid for the use of her
book characters in movies or any other and ice however this sort of income is
one of the hardest to make the reason being you have to create something
that’s really unique and isn’t easily replicable it requires a set of special
skills to create such assets but once done the earnings are unlimited those
are the seven types of income the average millionaire might have not all
of these income streams might be in their portfolio in fact some people have
become very rich millionaires or even billionaires by mastering one or two of
the methods above one of them is Warren Buffett who became a billionaire through
capital gains and dividends he chose to focus on capital gains on companies
within the stock market one more billionaire who has a few
streams of income is Bill Gates he made his empire through profit earnings and
royalty income through his asset windows there are so many other examples of
millionaires who chose a few of the income streams listed above but one
thing’s for sure none of them have become wealthy through earned income
we’re not telling you to leave your job but to start thinking out of the box of
the seven streams listed select those that suit your lifestyle those that you
are good in then becoming the best you can be in that niche don’t be afraid to
try something different today you never know it could be life-changing for your
family and your generations to come well that’s it for today we hope you enjoyed
the video in summary the seven types of income the average millionaire might
have are one earned income to profit income three interest income for
dividend income five rental income six capital gains seven royalty income if
you want to see more of these please let us know in the comments section also
subscribe so you don’t miss out on any of our videos
tap the bell icon so you don’t miss any upload with that said I’ll see you in
the next one