The rise of the internet and social media means that new doors of income generation have opened to us. How do we take advantage of this in motherhood? What’s the BIGGEST threat to your multiple income stream online business (and how to nullify it from DAY ONE).
Deborah Murtagh's The Ketogenic Switch programme
SMYD Chartered Accountants (NZ based accountants)
Internet and social media stats from https://ourworldindata.org/internet
We’re back with episode 6 and today I’m going to be talking about why multiple income streams are realistic these days, in order to grow healthy wealth in motherhood in 2020. I’ll talk about what things used to look like for multiple income streams versus what they can look like now; what the biggest game changer is that we need to be taking advantage of. But there’s also a big threat that you can nullify when you have multiple income streams, you can nullify this threat from day one. What is that? Well you’re going to find out.
So, when you think of multiple income streams, does it bring up any negative associations for you? Like, multiple income streams of work, multiple work streams, heaps of work, working all the time, being overwhelmed, chaotic, really hard to stay on top of. Well, that’s kind of how I used to think about it too, and it’s no surprise because really, this is how it used to be when you wanted to earn more money, and your full time job, or your main job didn’t bring in enough for what you needed.
In my childhood, my mum was divorced and working two jobs. One during the daytime – full time, and then, one in the evening. And she was also selling Amway on the side, so that’s kind of like the MLM of yesteryear.
I remember spending heaps of time at her Telecom office, that’s where she used to work in the town centre. I’d be playing around on the big cable wheels! I’ve got really clear memories of this actually, messing with the Spot dog decorations. Do you remember the Spot dog that represented Telecom (which is now Spark).
It was a long time ago, but these are very clear memories. In fact I had loads of memories made while Mum was at work, in fact, the job that she had in the evening was in direct line of sight from our house. So she could see out her office window and she could see our house. I think that’s one of the reasons she felt comfortable working that evening job with kids because she was never too far away and she could literally see the house. In fact, she told me years later that she used to watch my sister and I driving her Holden Sunbird up and down the driveway, thinking that we were getting away with it! We were teaching ourselves to drive! And she would watch us, and obviously she could see what was going on, and wasn’t too concerned, but Mum was at work.
There was also a key memory I have when Mum was at work and something big happened at home. It was an earthquake, a really big earthquake. During this earthquake I remember the driveway splitting. It wasn’t like one of those big cracks that opens up and you disappear into it, it was like a hairline crack. This was pretty terrifying, but my Mum wasn’t too far away. I guess we were quite lucky in that respect, we had a Mum that was working away from home, but she was close enough for us to shout I guess.
Mum worked really, really hard and mostly this was away from home. This is what it looked like for her. This was in the eighties and nineties trying to support her young family, and having to spend a lot of time away from home at work.
For me, by the time I started working – it would have been late eighties, early nineties I guess – I had a paper run and I sold Avon (which I didn’t really sell much of). Avon is a make-up brand and you can only buy it from people that sell it, like an MLM as well. And I didn’t really sell much, I just bought heaps at the cheap rate for wholesale sellers!
But as I grew up I got multiple hospitality jobs. So I’d work in the mornings doing breakfast at one place, then in the evenings doing dinner in the restaurant, but I always had multiple jobs. Always away from home obviously.
As I got a little bit older, just before I went travelling overseas, I remember I had a full time day job at the Westpac Training Centre as a training administrator, and at nights I worked in their TPC which is the Transaction Processing Centre, which was lots of fun (thankfully). Because you work a long day and then you go to your night job… This was all so I could earn extra money so I could get overseas and do my OE.
By the time I got overseas, having more than one job was just the thing you do. I was a snowboard instructor by day when I lived in Colorado, and I worked in an internet café in the evenings, which I enjoyed because I got to email my family. This is before mobile phones, and before you could get around and access the internet anywhere, before everyone had the internet in their homes. This was in the United States in the early 2000’s. They were quite progressive I guess. I remember looking at their internet plans and thinking ‘gosh that’s cheap, compared to New Zealand’ which was exorbitant at the time.
There was always more than one job, if you wanted to earn more you had more than one job.
When you take that into motherhood, oh my gosh, that just does not work. Because you are already, as you know, extremely busy. That’s just not a great option, to work double the time, more jobs away from home. It’s just not going to work, and that’s the whole reason Leveraged Mama came about. But I think you know that now!
Looking back at these times when I had more than one job, things were really, really different. I want to point out just how different it was back then because it’s easy to forget how far we’ve progressed with technology and social change in such a short amount of time.
When my mum worked at Telecom, she started in the toll room, and they had to take a cable out and stick it in another one to connect the calls. This was a very long time ago, it would have been when I was under 10 years old, gosh, under 5 years old maybe. That progressed into landlines, where you could just phone people up. And phone boxes! The point I want to make here is that the internet did not exist. The internet didn’t exist for the public until 1989, 1990. It was a completely different landscape back then.
When I worked in this internet café in Colorado in the early 2000’s, this was before WIFI really took hold, and 3G and 4G weren’t a thing. Mobile phones weren’t a thing. Social media did not exist. Social media didn’t come around until the year 2000, so a lot has changed.
“The percentage of US adults who use social media, increased from 5% in 2005 to 79% in 2019. Even on a global stage, the speed of diffusion is striking. Facebook surged from covering around 1.5% of the world population in 2008 to around 30% in 2018.”ourworldindata.org/internet
I’m just going to let that sink in. This rate of change, absolutely incredible. What this means, is that you can reach these people, who are using the internet and social media, you can reach them from you phone or from your computer, to their phone or their computer and you both can be anywhere. WIFI, mobile phones, fast internet, this is a huge, huge change since my Mums day and my day where we were working double jobs.
Of course, businesses are really onto this, and jobs can look quite different now. Think of the virtual assistant, that job didn’t even exist before online businesses were a thing. Why would it? There was no need!
How we actually create our income has really, really changed. It’s this anywhere, anyone, anytime aspect, that’s the game changer for us and the way we earn income in 2020.
We can use social media to access our customers now, just by being authentic. Being yourself online, and showing the value of what you can offer to the people who can benefit from it. That’s a simple sales tactic. Be yourself, provide something of value, find the people who it would be valuable to, and show them the product you’re offering. This is a really easy thing to do on social media, I think that you already know this.
How much time do you spend on social media? And how often do you discover someone who makes a great change to your life, and you go ‘where did I find that person?’
My most recent example would probably be Deborah Murtagh. She runs The Ketogenic Switch programme. I pay quite a lot of attention to how I discover people these days, and I discovered her via a Facebook ad. It just popped up into my feed one day and what she was saying really made me stop and go ‘oh!’ She said something like “when you’re losing weight you shouldn’t be exercising”. I said ‘yes I like the sound of that!’ because I wasn’t exercising at the time and I was feeling guilty all the time and I thought ‘what, I don’t have to exercise and I can still lose weight? I want to hear what this woman has to say!’ So, she was attracting me, women like me who were struggling with exercise, but also really wanted to lose weight. She said the right thing and drew me in and voila, I lost 8kg in the following months. And I’ve kept it off!
So it’s really interesting to me how we come across these people. She reached out through social media – where I was hanging out – and she bought me into her sphere, which is really cool. So, Deborah Murtagh is a great example of someone who is earning all of their income online, but multiple income streams in 2020 can be a mix of on and offline.
You might have your main job, plus, you’ve got a blog on the side that is generating passive and leveraged income from maybe ads and affiliate marketing and online courses.
Maybe you are studying to become a designer, and selling digital products on Etsy, and teaching others how to do the same thing: How to set up an Etsy store when you’re a design student.
Maybe you’ve got some e-books on there or some stock photography sales on there.
Maybe you are selling an app. Like a Google Play Store app or an Apple app, and you have a remote job where you work for a company that is based in a different country, you work online for them.
These are all very different ways of working now, that have been enabled by social media and the internet. These sorts of things were not possible before, they just were not. They weren’t even thinkable. Maybe the Jetsons did, the Jetsons probably thought of it because they’re pretty onto it!
But my point is, there is going to be more growth, in the area of the internet and social media. The history of the internet and social media has only just begun. We don’t know what’s next. But what we do know, is that more and more people are coming online, every day. That means there’s more and more people that can relate to us and our situation, and want to hear what we have to say, like our style, love our Kiwi accent, or whatever about you that makes you unique.
I think it’s something like 27,000 people every hour use the internet for the first time. I think you can imagine that my mind has just blown right now! I’m a stats girl, I like stats. That’s heaps right? These people, you know where they’re going, they’re coming to social media, so you need to be there to be able to offer them value, and exchange that value, rather than having to go out and get a second job and pay secondary tax and all that sort of stuff.
On that note – tax – we’re going to talk about that soon.
There will be more growth, there will be more change, we don’t know exactly what that looks like, but the best time is right now, to create an online business. I have to drive that home for you.
I know that I’m pretty convincing about this, but the truth is I am attracting more and more women who are creating online income streams, and here’s me encouraging that. It’s not a good thing for me to encourage you with this without giving you a heads up on the worries that I’ve had and the threats that have come up in my business that I’m addressing, because of the way my business is structured.
With global reach, with multiple products for sale, multiple ways of earning income. I got paid for using my face in an ad the other day. The income comes from multiple currencies, and multiple entry points. I get paid in US dollars, I get paid in NZ dollars, Australian dollars. I get paid via an invoice to my bank account, I get paid via PayPal, via Stripe. I got paid to my Sharesies account the other day. So I’ve got multiple currencies and entry points. And these are all sources of passive and leveraged income.
It’s so important, regardless of how you earn your income, to keep track, so that you can file an accurate tax return.
I have always kept really good records. Partly because I like to know where my money is going, and where it’s coming from, so I can make better decisions. But also I’ve always been very cautious about that sort of thing.
And because I’m now doing something which is quite progressive, and quite forward thinking, I’m not within the safety of the job where you get paid money after your tax is taken out – where you have one job and the IRD sorts it out at the end of the year if you haven’t paid enough or you’ve paid too much.
With me, I’ve got multiple sources of income so it’s really important to stay on track and on top of things with this sort of online business.
I save all receipts digitally, they’ll come in via my email, I will save them into a folder that’s sorted month by month for the tax year, and I use Xero, which is an accounting tool, to keep track of all the incoming and outgoing money. I also have an accountant, who advises me. And I will hire a book-keeper this or next year.
If you’re wondering, an accountant is different to a book-keeper. Some accountants do book-keeping as well but my accountant looks after things such as GST, claims etc. I can call him anytime I want with questions about tax which is really important to me because tax can be really confusing.
A book-keeper is, as I understand it, keeps track of the receipts, makes sure that returns get filed on time with the accountant. I think they’re slightly different, but we’re going to find out.
My point here is, don’t tussle with your tax department, Inland Revenue Department. Don’t tussle with them. There is no point.
I am actually going to read something that my accountant wrote in a recent email, and I found it really useful stuff just to remind you that you need to stay on top of things.
“From a tax avoidance point of view, a reminder, please don’t do cash jobs. The IRD’s new system has access to a mountain of data, that can be used to determine if you’re not declaring all of your income. They compare your tax return with all tax returns filed in your industry, against all assets in your name. Have you bought a car and insured it in your own name, do you own a boat? Been smashing through some credit card purchases and paying them off with cash? IRD knows about it and will compare your tax return to see if the information you provided allows you to own those assets. They also get daily EFTPOS takings and will compare the EFTPOS takings against what is in your bank account to determine if all of it is getting banked and more. However, even with all that technology, the most common method of getting caught is through someone dobbing you in.” (host note: If you’re not a kiwi it means telling on you, narking) So as I’ve said before, cash jobs are a big no.”Jason from SMYD Chartered Accountants
Thank you Jason for your input there.
How that relates to my situation is, take for example the payment I received via my Sharesies account, which is a really good idea, but I’m like how do I declare that income? As I said, I already keep good records, which is very lucky. I’ve just discovered how to hook up my Stripe and my PayPal account to Xero dashboard which is a little bit icky because I’m trying to figure out which are duplicate transactions and which are the original ones. It can get a bit yucky. But this is why I have my accountant and I can call him and go ‘oh my gosh, have I done the right thing?’
Because, even though I’ve got good records, sometimes all the data and all the obligations can really feel a bit mind bending. The thing is this is a part of doing business. If you want to have a business, you don’t get to have the safety of hanging out in a job and not having to deal with this. You are a business person and you have to deal with business things. There are many benefits, obviously, to having a business in terms of financial and fulfilment and all sorts of stuff. But you do have to take care of the due diligence stuff like tax and accounting.
So, if you recall, my long term business goal or longer term business goal, is to grow my business to generate multi-millions of dollars. At that point, I’m going to become very, very interesting to IRD. So I want to be sure that I’ve done my due diligence and that I know for certain that I’ve kept up with my obligations. That’s absolutely not something that I want hanging over my head.
So while my business is small and growing, I can spend the time getting my head around different things and making sure that everything is set up properly. That I’m declaring everything and staying on top of it. When a new income stream starts to come in, that I’m on top of it, that I make sure that it’s declared in my Xero account.
It feels like a bit of a downer to be talking about tax in that way, however, it’s just what we’ve got to do if we want to be wealthy business owners: we need to deal with things like tax. I’m sure you’ve heard bad stories about people who have not dealt with their tax obligations correctly, and from personal experience (knowing people that have run into a tussle with the IRD), they’ve got a lot of resources behind them. You will not win, don’t even think of going there.
Declare income, just declare it! If it feels hard, that’s just what you’ve got to deal with. Say ‘thank you universe for this money and now I’m going to do the right thing.’
A recap on what we’ve talked about.
Firstly, the world has changed, but we can take advantage of different opportunities now and that’s what we should be doing as Mums. These opportunities that allow us to create income streams that are home based. So, so important that allow us to create multiple income streams without having to be in two places at once, or three places at once.
We’ve got millions of customers that are accessible via social media now. We don’t have to have a day and a night job just to increase our income. We’ve got a mix of online and offline options. There’s going to be more growth so we’ve got to be ready and that means getting our online income streams underway now, not later.
With new ways of earning and the changing world of technology, we still require good tracking. And the final point was, do not mess with your tax department! Just don’t okay!
I would love to know what your takeaways were from this episode, and if it has helped to trigger any thoughts in your mind like ‘I need to be tracking that’ or ‘Do I need to talk to an accountant, or get some advice.’ An online business is quite different from a traditional brick and mortar business, we do need to be thinking about things in a different way and as Mums building online income streams, we’ve got to be on top of it.