Growth & Jobs | ‘One source of income is very risky’

“RELYING ON a single source of income is very risky,” stressed Rose Miller, financial education consultant at the JN Foundation. She emphasised that diversifying income streams is critical for financial stability.

“Unexpected circumstances and expenses can arise at any time. Having other sources of income provides a safety net, ensuring that you are better prepared to handle financial setbacks,” she advised.

Miller is encouraging persons to consider pursuing side ventures that align with their expertise and interest.

“It’s always wise to explore opportunities for earning additional income, such as tutoring, farming, baking or monetising a hobby. The possibilities are endless. Whether it is utilising a newly acquired skill or transforming a hobby into a business, what may start as a small venture can, with proper management, provide significant financial benefits over time.”

In addition to achieving financial security, Miller pointed out that having multiple sources of income allows one to accomplish one’s goals faster and take care of unforeseen expenses with greater ease.

“When you have other earnings, you give yourself more control over your financial future. It’s about creating options and reducing the stress of living from one pay cheque to another. Every little bit extra makes a difference,” she maintained.

Miller further underscored that with proper planning, the extra income earned from a side business can be used to prepare for a comfortable retirement, pay off debt, invest in personal and professional development, and being able to assist others in need.

She also pointed out the importance of balancing side business ventures with one’s primary job and personal commitments.

“Effective time management is essential when pursuing additional income opportunities. It’s important to strike a balance between earning extra and maintaining your well-being. Overextending yourself can lead to burnout, reduced productivity, and even impact your primary job. The key is to set realistic goals, manage your workload efficiently, and ensure that your side ventures complement rather than compromise your overall quality of life,” she advised.

Miller recommends that persons whose time and existing commitments make it difficult to pursue a second job may consider passive incomes that require little or no effort.

“Renting out a section of your home, for example, can be an excellent way to generate passive income,” suggested Miller. “It’s a smart investment that allows you to maximise unused space, providing a steady stream of income.”

Carmen Smith*, a Kingston-based trained teacher at both the early-childhood and secondary levels, related that private tutoring has been a valuable means of supplementing her salary.

“My reason for doing so many different courses is to be marketable and multiskilled because for me, it’s important to have options for income. One source of income is just too stressful for me.”

A teacher of information technology at the Caribbean Secondary Education Certificate level, the educator provides private tutoring to students preparing for the Primary Exit Profile exam and younger children in numeracy, literacy and critical-thinking skills, as well as coaching children with special needs.

Smith noted that the COVID-19 pandemic strengthened her position against one income source.

“Five years ago, when many people had loss of income, loss of job and hours cut, a second income allowed you peace of mind to carry on with your affairs if one entity didn’t pay on time,” she said. “I like the idea of being able to pay my bills from one source, which is not my main source, and my main source goes into savings,” she reasoned.

Likewise, Charles ‘Richie’ Curtis, a resident of Salt River in southern Clarendon, who operates a vegetable farm while also working as an electrician, shared that having a second income helps to meet his financial obligations.

“It’s really good to have two incomes, because sometimes you can fall short on one,” he said, explaining that adverse weather conditions sometimes affect his crops, resulting in less yield and reduced income.

“You don’t know what the future holds. With global warming anything can happen, so every farmer should have a second skill. Choose something you can depend on, something you love,” he implored.

*Name changed to protect identity