Increasingly, American workers are concerned about career stability. They want to be sure they’re getting into a career that affords them a steady, reliable salary, and that their job is going to last for many years, if not decades.
Certainly, some careers are inherently more stable than others; there’s a long list of jobs that have become completely obsolete over the years. But rather than hunting down the most stable career possible, you might be better off making any career more stable with the help of supplementary passive income.
But what is this strategy, exactly, and how does it work?
Career Stability Concerns
First, let’s examine why so many people are concerned about career stability these days.
These tend to be some of the biggest reasons:
- The gig economy. The gig economy arose in the 2010s, accelerated by the prevalence of apps designed to connect companies and individuals with independent contractors. In an effort to cut costs and achieve more agility, businesses are more interested in contractors and short-term gigs than long-term full-time workers.
- Automation and AI. Some people are worried about the future of artificial intelligence (AI), automation, and other technologies. If sufficiently developed, they could hypothetically grow to replace almost any human job.
- COVID-19 and economic instability. The COVID-19 pandemic introduced economic fears to billions of people. Unemployment remains high, and it’s not certain how the economy at large will recover. Along with the different types of student loans still outstanding, it’s been a rough year for nearly everyone.
The Perks of Passive Income
Passive income is a strategy designed to help you make money without requiring much time or effort on your part. It’s never “truly” passive, since you’ll always need to invest some initial time or money to get the strategy going.
However, it may be one of the best ways to increase your financial stability, and for several reasons:
- Minimal time investments. You won’t need to invest much time or effort into your passive income sources, especially once they establish some independent momentum. This means you can continue managing them and benefitting from them even as you pursue a full-time career as your anchor.
- Income diversification. Any investor can tell you the importance of diversifying your portfolio; if you’re exposed to many different sources, no single source can bankrupt you. Similarly, if you’re collecting income from many different sources, no single source can devastate your finances. Even if you lose your job, you can collect enough income to keep moving to your next opportunity.
- Cash flow improvement. Passive income doesn’t only generate income when you lose your job; it will add to the money you make from your full-time career consistently. In other words, you’ll be able to multiply your income. This allows you to save more money, giving you greater financial stability—and one day, full financial independence.
- Skill diversification. Most passive income sources require you to learn new skills, gain new knowledge, and become exposed to different industries. The experience you gain from passive income sources could be used to launch entirely new careers (if you ever need to tap into one).
- New opportunities. You may also use your passive income sources as a way to find new opportunities. Generating passive income is often a great way to expand your professional network and meet like-minded peers; you can tap into these resources if ever need to change jobs or careers.
Examples of Passive Income
Passive income is difficult to achieve, but there are several strategies that can help you do it:
- Real estate. If you buy a property, you can make money by charging rent to your tenants. Ideally, you’ll collect more in rent and other forms of income than you’ll spend in ongoing expenses. And if you hire a property management company, you can remain almost completely hands-off.
- Dividend stocks. You could also buy stocks that are known for paying dividends. Depending on the company, you could make up to 2 to 4 percent of your principal on an annual basis. You’ll need a lot of stock to see a big payoff, but you can build to this over time.
- Blogs. If you can create a blog that attracts a sufficient stream of traffic, you can make money from it in a variety of ways. For example, you can use advertising or affiliate links to generate revenue, or sell a copy of your eBook.
- Online businesses. Other online businesses can also be tapped for passive income, as long as they don’t require much ongoing upkeep from you.
It’s hard to predict which careers will remain stable indefinitely and which ones are on the chopping block. But you won’t have to worry as much if you’re leveraging passive income to supplement your revenue. Try to rely on a variety of sources if you want to succeed long-term.