Readers of a certain vintage may remember the BBC’s TV series ‘Hustle’. A team of con artists, led by affable frontman Mickey Bricks, channel their inner Robin Hood to steal from wealthy, immoral or otherwise unsavoury ‘marks’ …and keep the money for personal gain. I previously lamented my lack of income diversity. How best to address this? Merely through more hustling? I’ve jotted down some thoughts as I puzzle how best to diversify my cashflow.
Every day is hustlin’ day
People love the idea of a side hustle. A little bit more work for a little bit more money. Financial, if not also psychological, resilience against ‘the man’ and their 9-to-5 whip.
Some side hustles are the adult equivalent of a paper round. Others are fully fledged business ideas. A few are totally left field, such as GFF’s (tongue-in-cheek) buy-to-let pets. The financial forums are littered with posts about successful side hustles. Couldn’t I just pick one from the list, ‘do it’ and watch the bank balance burgeon?
For starters there’s a publication bias afoot. You less frequently hear about people’s calamitous failures at side hustling and the lost money, energy or time involved. ‘He who dares wins’ and all that jazz, but at the moment I needn’t risk being one of the losers.
Further doubt comes from the temporal aspects of a side hustle. If I think about the time I already spend keeping my professional plate spinning, it leaves little left to get a second one up and running. Perhaps these feelings will change in the future and I’ll pick up a suitable second source of income. For now, however, I think I’ll park the idea of putting significant resource into generating a consistent cashflow from a side hustle.
Something for nothing
If a well-working side hustle can be a cash cow, then passive income is more of a golden goose. I won’t debate the semantics of whether any income can ever truly be passive, but the idea of generating cashflow without any ongoing input is tantalising indeed. It definitely circumvents my concerns that a side-hustle would be too time consuming.
All I need do is come up with a suitable idea; haul the income-generating ball to the top of a hill, give it a little push and… voilà!
Perpetual motion? Perpetual income? Friction is a stickler and there’d undoubtedly be some bumps along the way that would require more time and energy. That, in addition to the initial ‘activation energy’ getting the ball rolling is enough to be off-putting at present.
I read with fair interest about others’ dividend investing strategies. Some have managed to generate enough cashflow from dividends to cover the majority, if not all, of their living expenses. This is worthy of applause, but a strategy not without risk. For example, 2020 saw the hyperbolically named ‘dividend black hole’ appear, with hundreds of companies reducing or ceasing dividend payments.
Issues putting me off dividend investing:
• Time to find dividend-generating shares
• Cost of buying individual shares
• Risk of share underperformance vs. alternatives
• Potential CGT (if not in ISA)
• Increased complexity of tracking investments
• Cost of not re-investing dividends
• Fluctuating dividends due to economic environment
I wonder about the long-term cost/benefit trade off when it comes to dividend investing. Do dividend investors end up ahead at the end of the financial rat race? Who knows.
I certainly feel that it would require energy, add complexity and potentially reduce returns in a fashion that’s unnecessary for me.
Finance through finance
Monetising MedFI would be a potential money-spinner, but would definitely clash with my blogging values. I don’t want the aesthetic cluttered by invasive, garish adverts (the content of which I mightn’t be able to control). I don’t want the choice of topics, frequency of publication or other factors to be outside my sole control or swayed by the idea of making money. It’s an easy no at present.
‘If you’re good at something, never do it for free’ – Heath Ledger’s ‘The Joker’
What about turning my personal finance hobby into an income? I’d need to do some training, sit some exams (and by god do I have enough of these already) and earn some qualifications in order to be a bona fide ‘financioso‘. This won’t work right now for the same plate-spinning reasons as earlier. I’d also worry that the transition from hobby to profession would poison the interest I have in the field.
The driving thought behind my quest for income diversity was that I risk a total cessation in cashflow if I’m unable to practice medicine. Re-examining this unlikely possibility, it seems that a drive towards income diversity necessitates using a chunk of my precious free time and energy:
“Give up free time now to do more work now to earn money via a different cashflow to protect against potential future calamity.”
It sounds imbalanced to me.
I think at present the con is on when it comes to income diversity. A deception. A distraction. Stealing time and energy away from other important facets of my life. An alternative way of increasing income diversity would be to abolish the need for an income entirely i.e. financial independence. Perhaps I should remain focussed on that, instead of being hoodwinked by engaging in cockamamie schemes to generate alternative cashflow.