7 Powerful Income Streams that Millionaires Build – Family and FI (2024)

Did you know that the average millionaire has 7 streams of income? This fact comes straight from the IRS themselves.

Most people only have 1 stream of income, which is the earned income they get from their job. If that includes you, don’t sweat it. There is good news!

YOU DON’T HAVE TO BE A MILLIONAIRE TO HAVE MULTIPLE INCOME STREAMS!

All you have to do is start learning and working towards your goal. Don’t let the idea of building wealth overwhelm you.

“Wheneating an elephant, take one bite at a time.”

Creighton Abrams

The first thing you need to do is educate yourself. Discover exactly what these millionaire’s most common income streams are and then focus on building one at a time.

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Once you master one source of income, you can then funnel that money into another one. With time, growing your wealth will become faster and easier.

You just have to get started.

The 7 powerful streams of income millionaires have:

1. Earned income:

Everyone knows what earned income is. Earned income is the money you get from working your job. This is also the most common income stream and oftentimes people believe this is the only source of income that exists.

Millionaires hate earned income because it involves trading time for money and is often taxed higher than other sources of income.

2. Business Profit income

Millionaires own companies! When their business sells products at a higher price than it costs to produce, that extra money turns into profit.

You will actually pay fewer taxes on your business profits than you will on your salary. That’s why it is important to build a profitable business.

Remember, it’s not how much money you MAKE, it’s how much money you KEEP.

3. Capital Gains income

Capital gains income is the money you make from your investments growing. For example, let’s say you bought a stock 10 years ago for $10.00. If that stock grew to $50.00 and you sold it, that $40.00 difference would be capital gains.

Additionally, if you bought a property for $150,000 but then sold it later for $200,000, the $50,000 difference is considered capital gains. You only make capital gains when you sell your investment.

4. Rental income

This income comes from people renting something from you. This could be a residence, a building that someone else can run a business out of, or even something like renting out your backyard.

Do you know that more people have become millionaires from real estate than any other industry? If you want to become a millionaire, you need to study hard on the topic of real estate.

5. Dividend income

A dividend is like a thank you gift from a company. They give you this “gift” just for owning their stock.

You see when a company makes a profit, they can choose to give part of it to their shareholders. That money is called a dividend.

A single share’s dividend may only be a few cents, but if you own a lot of shares, dividends can eventually replace your income.

6. Interest income

Interest is money that someone makes from lending money to someone else. You may have earned interest from a CD or keeping money in a savings account.

This type of interest won’t be a lot. Bank will usually pay you less than 1%

However, you can earn more money in interest by becoming a lender yourself. For example, you could lend money to real estate investors or business entrepreneurs who will pay you way more than 1% to use your money.

7. Royalty/Licensing income

If you write a book that a publisher wants to sell, the publisher will give you a portion of the money they make from every book sold. That payment is called a royalty.

People can collect this income from more than just writing books though. For example, royalty payments can also come from tech, franchising and even videos.

Now that you know about these powerful income streams, what are you going to do with your new knowledge? Perhaps you’d like to join other like-minded people in the Financial Independence Community and work towards your goals. Or, fill out the form below and take the Money Making Challenge!

Remember… focus on one stream at a time. Building wealth is difficult at first, but it WILL get easier with time.