Millionaires Make There Money From 7 Different Income Streams

Ever wondered how millionaires make their money? It’s not just about having one high-paying job or winning the lottery. Most millionaires have several income streams that keep their wealth growing, even when they’re asleep. This article will dive into how many income streams millionaires typically have, what those streams are, and how you can start building multiple sources of income. You don’t need to be rich to get started—you just need the right approach.

Key Points Discussed:

• Millionaires typically have 7 streams of income.
• The 7 streams include earned income, dividend income, interest income, rental income, business income, capital gains, and royalties.
• Diversifying income streams reduces financial risk.
• You can start building your own streams by investing, starting side businesses, or earning passive income.
• Having multiple income streams creates financial security and flexibility.

How Many Income Streams Do Millionaires Have?

A common belief is that millionaires typically have 7 different income streams. This isn’t just a random number thrown around in personal finance circles—it’s a well-documented observation. The reasoning is simple: the more income sources you have, the more secure your financial position becomes. If one stream dries up, the others help keep you afloat.

Imagine you’re a table. With only one leg, you’re pretty wobbly, right? But with seven solid legs, you’re practically unshakeable. Millionaires apply the same logic to their income.

For most people, getting started with multiple income streams can feel like a monumental task, especially if they’re already working full-time or struggling with day-to-day expenses. But the good news? You don’t have to build them all at once! Starting small and slowly adding new streams over time is the key.

1. Earned Income

This is the income you earn from a job or business. It’s the most common type of income for most people—basically, the paycheck you receive for the work you do. But here’s the catch: it’s also the most limited. You’re trading your time for money, and there are only so many hours in a day.

Most millionaires start with earned income, but they don’t stop there. While you’re working your 9-to-5 or building your business, think about how you can start adding additional streams.

Action Item: If you haven’t already, look for opportunities to grow your earned income. This could be through asking for a raise, finding a higher-paying job, or offering freelance services.

2. Dividend Income

Dividend income is money paid to you from investments in stocks. If you own shares of a company, some companies pay out part of their profits to shareholders in the form of dividends. The more shares you own, the more money you can potentially earn.

For example, if you invest in a company like Apple or Coca-Cola, you can receive dividend payments regularly—kind of like getting paid for doing absolutely nothing. Sounds pretty good, right?

To put it in numbers, if you invest $50,000 in dividend-paying stocks with a 5% dividend yield, you could earn $2,500 per year without lifting a finger. The key is to keep reinvesting those dividends to compound your wealth.

Note: It’s like getting a thank-you card from your investments every quarter—only this card has cash in it.

3. Interest Income

This stream comes from lending your money out and charging interest. When you have money sitting in a savings account, bonds, or even peer-to-peer lending platforms, you’re earning interest on that money. While savings accounts may not offer much these days (hello, 0.01% interest!), other interest-earning avenues can be more lucrative.

For example, investing in high-yield bonds or using lending platforms like LendingClub can offer better interest rates. Although it’s not as exciting as dividends or big real estate deals, interest income can be a steady source of extra money.

4. Rental Income

Many millionaires have invested in real estate to create a consistent flow of rental income. Whether it’s owning residential properties or commercial buildings, real estate can offer both monthly cash flow and long-term appreciation.

For instance, if you own a property and rent it out for $2,000 per month, that’s $24,000 annually. Once you’ve paid off expenses, the remaining profit is yours to keep. If you own multiple properties, your rental income can start adding up quickly.

Insight: Buying a rental property might sound out of reach, especially if you’re dealing with everyday financial pressures like bills and debt. But even starting small, perhaps with a duplex or a vacation rental, can lead to bigger opportunities later.

Action: Not ready to buy a whole property? Consider platforms like Fundrise, where you can start investing in real estate with as little as $500.

5. Business Income

Business income is the money you make from owning or running a business. This could be anything from a local store to an online side hustle. Many millionaires own businesses that bring in steady profits and are scalable. Unlike earned income, business income can grow exponentially without requiring you to put in more time.

Even a small side business can start to create meaningful income over time. For instance, let’s say you start an online store selling digital products. Once you’ve created your products, there’s no limit to how many you can sell. You’re making money while you sleep!

Note: It’s like having a mini version of yourself working 24/7 while you binge Netflix. Who doesn’t want that?

6. Capital Gains

Capital gains income comes from selling investments, such as stocks, bonds, or real estate, for a profit. This means you bought something at one price and sold it later for a higher price. The difference between the buying and selling price is your capital gain.

For example, if you bought shares of Tesla for $200 each and sold them two years later for $800 each, you’ve just pocketed a nice profit. The trick with capital gains is knowing when to buy and sell, but with patience and good investment strategy, it can be a major income stream.

7. Royalties and Licensing

Royalties are the payments you receive for using your intellectual property. If you’ve written a book, recorded music, or even developed a patent, you can earn royalties every time someone purchases or uses your work. This is one of the most passive income streams available—create something once, and keep earning from it for years to come.

Authors, musicians, and inventors often earn substantial royalties from their creations. Even if you’re not in those fields, you could earn royalties through licensing deals for products or software.

Why Do Millionaires Have Multiple Streams of Income?

Having multiple income streams creates financial security. Think about it—if one income stream dries up (like losing a job or having a bad investment year), you still have six others to fall back on. It’s all about reducing risk and maximizing opportunity.

On top of that, having more streams of income can accelerate your wealth-building process. Millionaires don’t just get rich by working harder—they work smarter by spreading their money and efforts across different opportunities.

Note: It’s like playing Monopoly with extra dice—you’re not just rolling once, you’re rolling several times and collecting cash every time you pass “Go.”

Final Thoughts: Start Building Your Income Streams Today

If the idea of building seven income streams sounds overwhelming, remember that it’s all about taking small, consistent steps. Millionaires don’t build wealth overnight, and you don’t need to either. Start with one stream, whether it’s investing in stocks or starting a side hustle, and build from there.

Today’s Task: Today, take one step toward building a new income stream. Whether it’s researching dividend stocks, signing up for a peer-to-peer lending platform, or launching a small business, start now, and watch your wealth grow.

With patience and persistence, you can create multiple income streams that lead to long-term financial success—just like the millionaires do.

Creating multiple income streams may seem like a lot, but once you start adding them one by one, you’ll feel more secure and empowered on your journey to financial independence. Keep it simple, take small steps, and before you know it, you’ll be well on your way to millionaire status.