7 Income Streams to Become a Millionaire

Disclaimer: I’m not a financial adviser or lawyer and don’t provide financial or law related advice. This information is based on my opinions and experiences. The article title itself sounds so click-baity, but my goal is to help educate, archive, and share my experiences in the hopes that it will help others.

Photo by Micheile Henderson on Unsplash

Good news is that you only need 3 income streams to become a self-made millionaire! Sounds easy, right? Or maybe not? I’ll do my best to break it down for you based on my experience as a newly self-made millionaire. But first you’ll need to learn what active income and passive income is.

Here’s the definitions from Investopedia.com:

Active Income: Income for which services have been performed. This includes wages, tips, salaries, commissions and income from businesses in which there is material participation.

Passive Income: Earnings an individual derives from a rental property, limited partnership or other enterprise in which he or she is not actively involved.

The goal is to have as many passive incomes as possible because you’re earning money with little to no effort! If you’re like most people, most of your time is working a 9–5 job, so by nature there’s only so much time you have to actively make money.

Below I’ll explain the different types of possible incomes.

1. Earned income from a job: This is the easiest type of income that most people start with, but unless you’re a unicorn, it’s hard to become a millionaire with just this income stream. This is the day-to-day job where you receive a steady paycheck from. My first job was a part-time summer job when I was a freshman/sophomore in high school, I was probably 13–14 years old, and I was earning $3.75 an hour! I’ve been working steadily since then.
2. Capital gains from stocks: Think of this as profit from stocks. You bought the stock low at say $5 per share and the value of the stock grows to $10 per share 3 years later. The difference between the price you paid and the price you sell is the capital gain. A bulk of my net worth is from holding stocks. My main holdings are in PayPal (PYPL), Apple (APPL), and Visa (VISA).
3. Dividend income from stocks: Some companies will pay you money (dividends) for holding on to their stocks. This is usually paid quarterly. I do not withdraw my dividends and re-invest it back into the same stock — this is called a DRIP (dividend reinvestment plan). This is my third highest income. Some popular companies that offer dividends are Apple, AT&T, Citibank, and Visa.
4. Profit income from a business or a side hustle: This income comes from selling products or services for a profit. It doesn’t even have to be a traditional business, but can be an Etsy or eBay shop that you run on the side. I own a few shops on eBay and Amazon to resell items I don’t use anymore. I’ve also dabbled in Etsy by selling products I’ve made.
5. Interest income from bonds: I don’t have any bonds, but I do earn very little interest in some my bank accounts. There’s also CDs (certificates of deposit) that give you a set interest rate if you leave the money in the account for a set time.
6. Rental income of properties and assets: This is pretty straight-forward and may seem like “easy money” because it sounds passive, but it does require some work to acquire the property and to maintain the property. First, you’ll need a nice down payment, then qualify for a loan, but the nice thing about this option is that you’re leveraging someone else’s money (the bank’s) to make more money!
7. Royalties income is a legally-binding payment made to an individual, for the ongoing use of his or her originally-created assets, including copyrighted works, franchises, and natural resources. This is usually associated with musicians and the music they create.

Now that you know the possible income types, the next steps to becoming a millionaire should be centered around analyzing your current situation.

• Money: Are you living outside your means? What’s your current financial situation?
• Minimalism: Everyone likes things, but do you have a lot of things that only temporarily sparked joy? Maybe it’s time to KonMari your life and distance yourself from consumerism.
• Productivity: Do you see yourself mindlessly scrolling through social media? Can you repurpose some of that wasted time to build a skill or educate yourself?
• Self-care: Without a healthy body and mind, none of this matters.

Hi! My name is Duong, a student of life and an aspiring author. Follow my journey of writing my first novel on my recently launched blog, GachaBot.com. I created this site to spread positivity, promote self-care, and share my thoughts.

Topics will range from language learning, Asian American diaspora, books, minimalism (KonMari), productivity hacks, financial freedom, self-care, and goal-setting.