Understanding Income Streams

Welcome to Lesson 3 of 4 in Financial Intelligence Foundations. It takes about 15 minutes.

An income stream is any regular way money comes to you. Many people depend on just one, and when it stops, everything stops. Others chase so many side incomes that they do none of them well. In this lesson you will look at the three main kinds of income and work out which are realistic for you, from where you are now.

Scripture comes from the King James Version. This is general education, not financial, legal or tax advice; rules on work and tax differ from place to place. It cannot promise particular results.

Since last time

Last time you chose a small action: naming a saving goal and making a first deposit, explaining saving and investing to someone, or sharing the warning signs of a scam.

Look back at the week. What did you try, and what did you notice? If you did not manage it, say so honestly and carry it into this week.

In this lesson you will

• Name the three main kinds of income: paid work, selling a skill or product, and something you own that earns.
• Explain how Scripture honours skilled, honest work done with a purpose beyond ourselves.
• Say which income streams are realistic for you now, and how to test a second one honestly.

Before you start

How true is each of these for you today, from 1 (not true) to 5 (very true)?

• I understand the different ways a person can earn an income.
• I have a skill that someone would pay for.
• If my main income stopped, I would have some other way to earn.

1. Three kinds of income

Almost every income comes in one of three ways:

• Paid work. Wages or a salary from an employer, or regular paid hours. For most people this is the main stream, and the most important one to protect.
• Selling a skill or something you make. Being paid for what you can do (tutoring, repairs, hairdressing, cooking, design) or for goods you make or buy and sell.
• Something you own that earns. A room you rent out, a tool, machine or vehicle you hire out, or an investment. This usually needs money first, so for most people it comes later, if at all.

Two cautions. A loan is not income: it has to be paid back. And be wary of offers of “passive income” that needs no work. Income that truly needs no work is rare, and most such offers are scams or ask for money you would be wiser to keep.

Imagine a delivery driver tempted by an online scheme that promises money while he sleeps. Instead he learns to repair bikes in the evenings. It is slower, but it is real, and it is his.

Think about it: Which of the three kinds of income do you have now? Which have you never thought about?

Try this week: Write down every skill someone has ever paid you for, or asked you to do for them. Aim for five.

2. Paul the tentmaker

Some believers feel that earning money is less spiritual than ministry. Paul did not see it that way. Arriving in Corinth, he found a couple who shared his trade.

Acts 18:2–3 (KJV) 2 And found a certain Jew named Aquila, born in Pontus, lately come from Italy, with his wife Priscilla; (because that Claudius had commanded all Jews to depart from Rome:) and came unto them. 3 And because he was of the same craft, he abode with them, and wrought: for by their occupation they were tentmakers.

Because he was of the same craft, he abode with them, and wrought. The great missionary made tents to support himself. A skill was a source of income he carried wherever he went, and earning sat comfortably beside his calling.

Paul also wrote about what our work is for.

Ephesians 4:28 (KJV) 28 Let him that stole steal no more: but rather let him labour, working with his hands the thing which is good, that he may have to give to him that needeth.

The former thief does not only stop taking. He labours, working with his hands the thing which is good: honest work, no income from deceit or harm. And the purpose includes others: that he may have to give to him that needeth. Paul makes no promise here that giving brings money back. He gives a picture of what our earning is for.

Think about it: What skill do you have that someone might pay for, as Paul's tentmaking was?

Try this week: Choose one way to do your main work better this week: learn one skill, arrive earlier, or finish a task you have put off.

3. What is realistic from where you are

The right next stream depends on where you start.

• Still at school or between jobs? Your skills are your first stream: a little paid help to neighbours, family or church members, done reliably.
• In paid work? Protect it first: do it well and keep growing your skill. A second stream is a small addition, never a reason to neglect the first.
• Running a small trade already? Strengthen what works before adding something new.

When you test a second stream, do it honestly:

• Start from a skill you already have, not a scheme you do not understand.
• Test small. Ask a few people whether they would pay, and what they would expect, before spending money.
• Count the time. The hours come from somewhere.
• Check your employment terms; some contracts limit outside work.
• Keep records and pay the tax that is due.

When you are ready to turn a skill into a venture, KMA's Enterprise Building Foundations course takes you there.

Think about it: Which of your skills could become a small second stream without harming your main work?

Try this week: Ask two people who might need your skill whether they would pay for it, and what they would expect. Write down what they say.

Activities

Reflection

• Where have you been tempted to chase easy money instead of growing a real skill? What would growing the skill look like?

Key takeaways

• Income comes from paid work, selling a skill or product, or something you own that earns.
• Earning is honourable: Paul made tents alongside his calling, and we work so that we can also give.
• Protect your main income first; a loan is not income, and “passive income” offers are usually scams.
• Test a second stream small, from a skill you have; check your contract, count the time, keep records and pay the tax due.

Your next step

You have finished Lesson 3. You are on the path of growth: you know your income picture and which next stream is realistic for you.

These lessons give you the everyday basics. To keep growing, KMA offers two next steps:

Mentorship. Grow with a KMA mentor who helps you apply these habits to your own situation and follows up with you on what you tried. See KMA's mentorship packages. See the mentorship packages

Or: the Financial Intelligence Track (monthly Learning membership). Prefer to learn on your own first? The Financial Intelligence Track goes further: the money mindset behind our habits, and debt management with a full tracking spreadsheet you keep. See the Financial Intelligence Track