Savings
2024-05-14 3 Min read
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If there is something that the last few years have taught us, it is to be well-prepared for all the uncertainties that come with your way in life. The climate of economic precariousness has further enhanced the importance of having a second source of income. A supplementary income is no longer a privilege but a necessity that you need to work towards fulfilling.
Importance of second income
In life, you may feel that your needs and wants are unlimited. The sources to fulfil these needs, however, are quite limited. This further underscores the importance of supplementing your income. Before we delve into how you can generate a second income, let us take a look at the reasons that make it so vital:
1. Your income should be able to beat inflation
With the unabated increase in inflation, your annual purchasing power will decrease. This can be a predicament if your income does not see a corresponding increase. To help you bridge this gap between your income and your expenses, an alternate source of income can make a significant difference, helping you to navigate the rising costs with greater ease.
2. Life is uncertain, you need an emergency fund
A second income can be very helpful in mitigating risks such as loss of income or a tragic event like the death of the primary earner. In an emergency, income from alternate sources acts as a financial shield. Furthermore, if you are facing a financial crisis, your additional revenue stream will help you sustain your living expenses in times of uncertainty.
3. Saving for the future is essential
Funding short-, medium-, or long-term financial goals can be easier to achieve when you have a second source of income. Purchasing a vehicle, planning your child’s higher education, taking a trip, or just pursuing hobbies are examples that can be financed by a second source of income. A second income ensures you don’t drain your existing funds to fulfil your long-term goals, thereby saving you enough for the future. When you are retired, having a second income helps you stay independent, thereby taking care of your financial needs.
4. More than one income can help achieve financial freedom
In life, having financial freedom is crucial. Freedom indicates you have sufficient funds to live a lavish life even after retirement. Establishing a second source of income is a smart move toward financial independence. Creating possibilities for minor investments will significantly boost your cash flow and help you build wealth.
1. Your income should be able to beat inflation
With the unabated increase in inflation, your annual purchasing power will decrease. This can be a predicament if your income does not see a corresponding increase. To help you bridge this gap between your income and your expenses, an alternate source of income can make a significant difference, helping you to navigate the rising costs with greater ease.
2. Life is uncertain, you need an emergency fund
A second income can be very helpful in mitigating risks such as loss of income or a tragic event like the death of the primary earner. In an emergency, income from alternate sources acts as a financial shield. Furthermore, if you are facing a financial crisis, your additional revenue stream will help you sustain your living expenses in times of uncertainty.
3. Saving for the future is essential
Funding short-, medium-, or long-term financial goals can be easier to achieve when you have a second source of income. Purchasing a vehicle, planning your child’s higher education, taking a trip, or just pursuing hobbies are examples that can be financed by a second source of income. A second income ensures you don’t drain your existing funds to fulfil your long-term goals, thereby saving you enough for the future. When you are retired, having a second income helps you stay independent, thereby taking care of your financial needs.
4. More than one income can help achieve financial freedom
In life, having financial freedom is crucial. Freedom indicates you have sufficient funds to live a lavish life even after retirement. Establishing a second source of income is a smart move toward financial independence. Creating possibilities for minor investments will significantly boost your cash flow and help you build wealth.
How to generate your second source of income?
Given below are 5 easy ways to generate a second source of income. Take a look.
1. Start a home business
Consider starting a home business. You can try in one of the following industries: freelance writing, catering, handmade goods, or organic farming. Pick a hobby or skill that you can manage or deliver from home. It can be challenging, but with perseverance and commitment, a home business can yield a massive passive income.
2. Rent your extra space
If you have an additional room that you aren’t using, you can rent it out. Bring out the word by referrals, advertisements in local newspapers, posters, or banners. You can also place an advertisement in online portals. However, bear in mind that you can only do this if you own the property.
3. Sell your creations online
Making money online by selling your work is another incredible second income trick. This can include anything from handmade products to clothes to jewellery and edibles. If you have access to inventory, this gets even easier. You may market your products and handle everything from payments to shipment with ease by using platforms like Amazon, Flipkart, or Meesho. You can also try social media platforms like Instagram or Meta (Facebook) to market your creations.
4. Put your money to work, invest it
The country’s investment market is booming. There are various financial products you can invest in. A lot of people find investing in mutual funds to be a great option. Over the years, the real estate market has changed dramatically, opening up new avenues for making money. While these products offer high returns, they come with their own set of risks and challenges. Make sure you invest in one only when you are fully aware of its pros and cons.
5. Invest in an endowment plan
This is yet another low-risk savings tool that can turn out to be your best investment and second income option. Investing in an endowment plan helps you get insurance as well as investment in a single policy. Endowment plans are generally goal-based savings plans that accumulate a huge amount of corpus at the time of maturity. These plans are an excellent option for people who have an impulsive way of spending money. You can use it to fulfil your different financial requirements, reinvest it, or use the money to enjoy post-retirement.
1. Start a home business
Consider starting a home business. You can try in one of the following industries: freelance writing, catering, handmade goods, or organic farming. Pick a hobby or skill that you can manage or deliver from home. It can be challenging, but with perseverance and commitment, a home business can yield a massive passive income.
2. Rent your extra space
If you have an additional room that you aren’t using, you can rent it out. Bring out the word by referrals, advertisements in local newspapers, posters, or banners. You can also place an advertisement in online portals. However, bear in mind that you can only do this if you own the property.
3. Sell your creations online
Making money online by selling your work is another incredible second income trick. This can include anything from handmade products to clothes to jewellery and edibles. If you have access to inventory, this gets even easier. You may market your products and handle everything from payments to shipment with ease by using platforms like Amazon, Flipkart, or Meesho. You can also try social media platforms like Instagram or Meta (Facebook) to market your creations.
4. Put your money to work, invest it
The country’s investment market is booming. There are various financial products you can invest in. A lot of people find investing in mutual funds to be a great option. Over the years, the real estate market has changed dramatically, opening up new avenues for making money. While these products offer high returns, they come with their own set of risks and challenges. Make sure you invest in one only when you are fully aware of its pros and cons.
5. Invest in an endowment plan
This is yet another low-risk savings tool that can turn out to be your best investment and second income option. Investing in an endowment plan helps you get insurance as well as investment in a single policy. Endowment plans are generally goal-based savings plans that accumulate a huge amount of corpus at the time of maturity. These plans are an excellent option for people who have an impulsive way of spending money. You can use it to fulfil your different financial requirements, reinvest it, or use the money to enjoy post-retirement.
Why POS-SUD Life Sanchay?
POS-SUD Life Sanchay is a safe and assured way to supplement your income and ensure your family’s financial stability. It is a regular premium, non-linked, non-participating POS (point-of-sales) savings life insurance plan. Investing in the POS-SUD Life Sanchay plan is highly beneficial if you wish to keep some savings aside to build supplementary income in the future. This plan offers a guaranteed source of income for 10 years with a hassle-free issuance.
The plan ideally promotes the idea of a second source of income and helps you achieve the goal of financial independence for yourself and your family. If you are the primary earner and are looking for an investment plan that helps you fuel your additional expenses, POS-SUD Life Sanchay is the right plan for you.
The plan ideally promotes the idea of a second source of income and helps you achieve the goal of financial independence for yourself and your family. If you are the primary earner and are looking for an investment plan that helps you fuel your additional expenses, POS-SUD Life Sanchay is the right plan for you.
Conclusion
While rent from property, double work shifts, etc., are appealing alternatives, they come with their own set of challenges. Nevertheless, every side hustle requires a lot of effort, time, and patience to stand out successfully. However, a second income aims to supplement your primary source of income. All things considered, having a passive/ second income will only help you move forward in life by building a strong financial base. With disciplined savings, you can have enough funds to support yourself later in life.
Reference: POS-SUD Life Sanchay: UIN: 142N058V01
Reference: POS-SUD Life Sanchay: UIN: 142N058V01
Disclaimer
POS – SUD Life Sanchay | UIN: 142N058V04 | Individual Non-Linked Non-Participating Savings Life Insurance Plan
Star Union Dai-ichi Life Insurance Company Limited | IRDAI Regn. No: 142 | CIN: U66010MH2007PLC174472
Registered Office: 11th Floor, Vishwaroop I.T. Park, Plot No. 34, 35 & 38, Sector 30A of IIP, Vashi, Navi Mumbai – 400 703 | Contact No: +91 22 7196 6200 | 1800 266 8833 (Toll Free) | Timing: 9:00 am – 7:00 pm (Mon – Sat)| Email ID: customercare@sudlife.in | Visit: www.sudlife.in | For more details on risk factors, terms and conditions, please refer to the sales brochure carefully, before concluding the sale. |Trade-logo displayed belongs to M/s Bank of India, M/s Union Bank of India and M/s Dai-ichi Life International Holdings LLC and are being used by Star Union Dai-ichi Life Insurance Co. Ltd. under license.
Star Union Dai-ichi Life Insurance Company Limited | IRDAI Regn. No: 142 | CIN: U66010MH2007PLC174472
Registered Office: 11th Floor, Vishwaroop I.T. Park, Plot No. 34, 35 & 38, Sector 30A of IIP, Vashi, Navi Mumbai – 400 703 | Contact No: +91 22 7196 6200 | 1800 266 8833 (Toll Free) | Timing: 9:00 am – 7:00 pm (Mon – Sat)| Email ID: customercare@sudlife.in | Visit: www.sudlife.in | For more details on risk factors, terms and conditions, please refer to the sales brochure carefully, before concluding the sale. |Trade-logo displayed belongs to M/s Bank of India, M/s Union Bank of India and M/s Dai-ichi Life International Holdings LLC and are being used by Star Union Dai-ichi Life Insurance Co. Ltd. under license.
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