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Finance 101: How To Manage Multiple Income Streams Like a Pro

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May 6, 2022


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Having more income doesn’t really amount to a problem for anyone.

Having multiple sources of income, building passive wealth, and growing financially is a current hot favourite.  From teenagers learning about NFTs to millennials thinking of increasing passive revenue, it’s all everyone seems to be talking about.  

Having more money is great. But not knowing what to do with more income is just as bad as not making it at all. Maybe, it’s even worse because of the time and energy you spend generating the income. If you’ve jumped on the multiple streams wagon and added to your income with it, congratulations!...but the journey doesn’t end there.  

You’ve got to deal with surplus income effectively for it to truly be profitable for you. How can you do it? Well for starters you can - 

1. Clear your debt 

No one likes going through their months with debt and interest getting piled on. If you weren’t side hustling to reduce debt to begin with already, strategise your new income around your debt before you add on to your lifestyle or goals.

If you have multiple types of debt on you, section out a bigger sum for high-interest debts. The longer that stays, the more money you have to give up. You could also look into tackling such debt with high yield investments or savings accounts to maximise your income. 

2. Backtrack to see your goals  

Sure, the primary reason behind having multiple streams of income is to have more money. But why did you decide you needed more money? Were you unhappy with your quality of life? Do you have loans to tackle or are planning a major life decision?  

It’s easy to get swayed by surplus income. It doesn’t take much to go on a shopping spree or book your next travel ticket. To ensure you don’t sway from your original goals, regularly backtrack to see how well you’re actually doing on those goals. Look into how far those goals are now and how much extra income is needed. In short, prioritise. 

3. Add to your emergency fund

Try to think of an emergency fund like insurance you’re keeping aside for yourself. With more streams of income, the scope of a crisis across streams increases. If you’re aiming at growth and longevity from your side incomes, then you’d be willing to take hits from them. This is all the more reason to increase your emergency fund.

The obvious reason being that it’s good to have an emergency fund with wider coverage. Be it health, accidents, or lack of job security, your fund should be strong enough to have your back through it all.

4. Bump up retirement plans  

Similarly to the emergency fund, a good way to use your surplus income is to add it to your retirement plan. Retirement isn’t a plus 60 concept anymore, and the wishful age for retirement is reduced by the day.  

To actually achieve this, explore ways you can save and invest for your retirement. A good way to calculate how much you’d need to retire is to multiply your annual expenditure by 25. This is a rather popular way to ensure that if you live on just 4% of this calculation, you’ll be able to live comfortably. There’s a bunch of calculators out there, give them a spin and set a skeletal retirement goal for you to build towards.  

5. Sort out your taxes  

 This has to be your priority regardless of any goals. Multiple streams of income mean multiple tabs of taxes you fall under, which you now have to calculate and pay. 

Learn about the ways you can save on taxes and increase your income tax returns. Depending on your streams of income, see what tax plans the government has laid out, and what kinds of investments, insurance, or even donations might help you save on taxes.  

Don’t forget to treat yourself 

Building multiple streams of income is a long drawn process with exhausting ups and downs. So when you do reach a milestone, don’t forget to treat yourself. There isn’t anything wrong with spending on fun, leisure, or even on your laziness now and then. 

Just have plans to manoeuvre your additional income around for its best use. It doesn’t have to be a serious goal, just know what you want to do with this money and keep a track of how much you’ve achieved. 


Fi Money is not a bank; it offers banking services through licensed partners and investment services through epiFi Wealth Pvt. Ltd. and its partners. This post is for information only and is not professional financial advice.
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