Has your money been impacted by the pandemic? Would you like to improve your finances? Want to know the big money lesson you should learn in 2020?
2020 has been a CRAZY year. The coronavirus crisis has totally upended life for many people.
But you never want to let a crisis go to waste.
There are lessons to learn from this. Every challenge we face in life is an opportunity to grow. I think there’s one big money lesson to take away from the pandemic. Knowing this information will help you and allow you to emerge from all of this much wiser and stronger.
This is actually the same lesson I learned during the financial crisis and Great Recession. I lost my job back in 2009, during the depths of the last crisis. It felt terrible at the time. But it was exactly the wake-up call I needed to build a better life for myself. And now I’m financially free in my 30s. Being unemployed and totally broke forced me to take a long look in the mirror. I had to think hard about a valuable lesson that was staring at me in the face.
This lesson is the SAME lesson people are learning in 2020. And I want to share it with you today, in hopes that it will help and inspire you.
I think there are a lot of things to take away from the pandemic. There are certainly some important health concepts, particularly relating around personal hygiene, that are being brought to the forefront of people’s minds. But we’re here to talk about money. And there’s one big money lesson this pandemic has taught us.
That lesson is this: We should not rely on a single source of income. We have to diversify our income sources.
You simply cannot count on an employer, job, or single paycheck to be there for you when you’re in need. How many people have lost their jobs this year? That’s probably their only source of income. This is a terrible situation to be in, to be beholden to unemployment and have so much income uncertainty in your life.
If the answer isn’t one source of income or a job, then what is the answer? The answer is DOZENS of different income sources. And these income sources should be diversified in a way that isolates them to a reasonable degree, so that losing one income source doesn’t cause you to lose the rest.
Better yet if those diversified income sources can be PASSIVE. This frees you up to work and make active income if you so wish. Then you can make even more money, and do it in a way that’s more enjoyable.
Working because you WANT to is much different than working because you HAVE to.
I have almost 150 different income sources, including my investments and various forms of business income and royalties. Plus, the vast majority of these income sources are passive, which allows me to spend time on cool projects I want to take on – like YouTube videos.
Approximately 130 of these income sources are from various company dividends. That’s because I own stock in more than 130 different companies, spread out across various industries in all parts of the world. Now, even dividends aren’t guaranteed. Some of these businesses are struggling right now. And I’ve even had a few dividend cuts.
But here’s the truth. If I have a dividend cut, or two, or three, it doesn’t really affect my overall lifestyle because my income is so diversified. Losing 1% or 2% of my income isn’t going to change my life. That’s a completely different situation to someone who’s reliant on a paycheck from their job. If that job goes away, and the paycheck disappears, they’re in a world of hurt. This income diversification lesson is great because it’s actionable.
You can start taking action today to set yourself up for a much better life 3, 5, or 10 years down the road. It’s precisely because I lost my job in 2009 and felt so powerless that I took the steps necessary to empower myself and become financially independent.
I never again wanted to rely on the kindness of an employer to make sure I could put a roof over my head or food in my belly. You should be setting up DOZENS of different income sources. And the more passive these income sources, the better. There are many types of passive income.
Rental income, affiliate marketing, book royalties, product building. Of course, DIVIDENDS are my favorite source of passive income. It doesn’t get much more passive than waking up to money you didn’t go to sleep with. Yet that’s exactly the experience of a shareholder. You can buy stock in a high-quality company paying reliable and rising dividends, and potentially get paid growing passive dividend income for the rest of your life. It’s a pretty sweet deal!
As for WHICH stocks to look at and possibly buy, make sure to follow us in the future. We’re posting great investment ideas on high-quality dividend growth stocks here every single week. If you’re fortunate enough to have not lost your job throughout this crisis, start cutting expenses immediately and create as much excess cash flow as possible. Then start intelligently putting that capital to work for the long term in great businesses and build MULTIPLE sources of passive income.
If you have lost your job, use this time wisely. Make sure you put a plan in place now so that when things start returning to normal and you’re able to work again, you don’t end up in the same spot all over again. You never, ever want to rely on a single income source. Let this pandemic lesson sink in and improve the rest of your life. Then you can find yourself five or ten years down the road with dozens of different sources of income, all of which are totally passive.
As for which stocks to possibly buy, make sure to follow our channel.
We’re regularly putting out videos on high-quality dividend growth stocks to consider. Of course, there’s also my own personal portfolio, which you can also take a look at.
— Jason Fieber
P.S. This six-figure portfolio, which I call the FIRE Fund, generates enough passive dividend income for me to live off of. It allowed me to retire in my early 30s. I’ve made my portfolio entirely accessible over at Patreon – and I post alerts there whenever I buy or sell a stock.
I put my money where my mouth is and am often invested in the same high-quality dividend growth stocks that I make videos on. Over the years, I’ve heard from thousands of investors who have been profiting from many of the same exact stocks I own. So if this sounds like something you think you could benefit from as well, check out this link to see my portfolio and start getting my buy and sell alerts.