Have you heard the statistic that millionaires have at least seven income streams? That’s seven different ways that they’re making money each month. Now take a look at your business; how many streams of income do you currently have? If it’s only one, then it’s time to open up that creative part of your brain and create more income streams.
Passive income is something of a misnomer. Work is still involved in creating products or setting up different forms of income but the difference is these streams of income can work for you almost on autopilot for years to come, long after the initial work is complete. So think of the creative process as work-heavy in the beginning while you can still earn money from them well into the future.
Benefits of Creating Passive Income in Your Business
- Increase your bottom line profits. This is the most obvious benefit but certainly worth mentioning because who doesn’t want to earn more profits? If you created a for-profit business, extra ways to earn income are always welcomed. As you well know, limiting your practice to 1:1 coaching can limit your income potential, making passive income streams even more important when your coaching calendar is filled to capacity.
- Regain time in your day. Hold up…I know I just said that creating products and other streams of income takes time but jump ahead and think about the back end of the process, when your product or income stream is completely set up and the upfront work is done. With a consistent, strong marketing plan, you can easily earn money on these passive income streams without much effort, even while you sleep, which means you can take off a little earlier or take an entire day off for fun because your passive income is still earning money.
- Increase your credibility by helping more people. Think of passive income as a way to share your expertise with an ever-expanding audience. A snowball at the top of a mountain is very small, which represents you with your inner circle of coaching clients. But as the snowball travels down the hill, it gathers more and more snow until it reaches mammoth size. The same is true of you as you reach out to more and more people, networking online and off, and providing guidance through your books, webinars, or courses. You’re leveraging your knowledge and showcasing your expertise to infinitely more people, which will lead to increased sales and an army of people who rave about your work. In this case, the snowball effect is a very good thing!
Planning Your Passive Income
Now that I’ve sold you on the benefits of having passive income streams, it’s time to plan out what those streams should be for your business. Traditionally, passive income often means affiliate marketing, writing a book, or creating courses based on your coaching specialty. Of course, you don’t have to follow these common sources of passive income – use your creativity to think of an idea that’s different from what other coaches are doing and will also appeal to your ideal target market.
Create a brainstorming list of ideas and then go back and review which ideas you’d be most passionate about. Is this a product that you can stand behind and passionately talk about with confidence? Is this an idea/topic that you can talk about for 30 minutes without preparation? The reason for requiring passion behind your idea is because having passion helps you stick with your idea and see it through.