For most people, life starts in their 20s. Young, healthy, and full of energy, 20-somethings are often seen as unpredictable and irresponsible. Not anymore. Today, people in their 20s are taking responsibility for their financial well-being and are more in tune with how the system works than ever before. 

That first million

In 2021 alone, the world added 5.2 million new dollar millionaires to the global rich list, with around half of them coming from the US. And while the average age by which the world’s richest 100 people earned their first $1 million is around 37, that number is coming down, fast. 

While most millionaires are over 60, they’ve had decades to commit to building long-term wealth wealth, leaving around 8% of American millionaires under 30. But with new tools, and monetized channels available to the younger generations, it’s no longer a question of how long you’ll need to wait before hitting that magical seven-figure mark but how hard you’ll have to work to get there. 

Why your 20s?

The sooner you start building your financial legacy, the better. Time is currency, and a year’s investment in your 20s can be worth a decade of putting money aside by the time you hit 50. Most people in their 20s don’t yet have expensive mortgages to pay off, aren’t already paying for their kids to go to college, and haven’t had the chance to rack up expensive debt. 

However, limited work experience means your primary income is still in the lower bracket, which means less cash to sink into retirement and pension funds. So finding a balance between earning a living that keeps a roof over your head and food on the table, and adding additional sources of income to start pushing towards millionaire status is the best place to start. 

The trick is to reinvest the proceeds of that one income stream into building the others. 

How many income streams are enough?

More than 3. That’s according to a study conducted by Tom Corley, who discovered that almost two-thirds of self-made millionaires had at least three sources of income. Aside from your primary source of income, having two or three additional streams means you’re on your way to making your first million. 

Diversification is important for knowing how to build multiple streams of income and maintain them. Rather than putting all of your eggs into one basket, any good financial advisor will tell you to hedge your bets on a varied portfolio. If one channel stops generating money, you can count on the others to keep the cash flowing. 

Aside from the money you earn from your day job, additional income streams belong to different categories, each offering varied benefits, and risks.

Investments

Investments are among the most common extra revenue streams and are the best starting point for people looking to kick off their additional revenue ambitions.

Investments consist of liquid capital inputs into funds, stocks, bonds, commodities, or assets. Time is the big variable here. The more time your investment has to mature, the more you stand to make from it. Investments are great adaptable options and can be taken out for short, medium, or long terms.

• Pros – Flexible, easy to access, and high earnings potential.
• Cons – Risky and often requires advanced knowledge and experience from an advisor who charges for their expertise.

Starting an Online Business

Starting an online business – is easier and more affordable than it has ever been. Starting a small business requires time and effort and carries a higher risk than investments, but the rewards are huge.

While external factors can affect your business, if you get it right, a small or medium business can be your golden ticket to building long-term wealth for decades to come. And, once you’re ready to retire, you can sell it, leave it to the kids or keep it going as an additional income stream long into your golden years.

• Pros – Exciting, massive revenue potential, and a significant asset for the future.
• Cons – Big initial investment, returns can fluctuate and requires a lot of attention, even costing you money in the long run.

The Side Hustle

The Side Hustle – is a relatively new concept (Okay, an old concept that has made a big comeback recently) that involves generating an income while still committed to your regular job. The side hustle can involve freelancing, writing monetizing blogs, selling products on eCommerce platforms, or generating revenue as a social media influencer.

Digital platforms have made it simple for pretty much anyone to have a side hustle, and you can count on it netting you a decent income if done right.

• Pros – Incredibly easy and quick to get started, requires little to no initial investment, and allows you to monetize your passions.
• Cons – Income can be volatile, margins are often low, and competition makes earning big money tough.

Knowing how to create multiple streams of income in your 20s and which streams you’re going to pursue is the first step in building long-term wealth.

Before gearing up to launch your multiple new income streams, you’ll need to figure out your income goals and what you’re prepared to do to reach them. Planning and getting started is easy, but once you’re up and running, ensuring that you don’t let these additional sources of income affect your life is vital.

There are literally hundreds of different income stream opportunities for someone in their 20s. However, the trick is picking the streams that lay the foundation for multiple revenue options that are both lucrative and sustainable over the long term. There is no point in creating a revenue stream that will stop giving after a couple of months or one that runs the risk of costing you more than it is paying out. 

We’ve curated a list of some of those income streams geared towards benefitting 20-somethings the most, won’t give out after a short period, and are most likely to guarantee success.

Offer rentals – for anything you’re not using.

Buying property is a must, especially if you can afford it in your 20s. Property is a sound investment and almost guaranteed to appreciate, so looking at an investment property (in addition to your primary residence) is a lucrative income stream. But rentals can also include household items, your own equipment, and even your car.

Create digital assets – that keep selling.

Platforms like Teachable and Skillshare have made it easy to create compelling online courses that people are willing to pay for. Once published, they can keep on earning for a long time. Pick a topic, create a course, eBook, or paid newsletter subscription, and sell. Simple!

Freelance – your talent and scale your side hustle

Heard of the Gig Economy? It’s booming right now and offers people in their 20s the perfect opportunity to make the most of their time by allowing them to take jobs on the side that pay well and are over in a flash. Freelancing is a great way to take your passion and monetize it for additional revenue.

Run a website – and build a monetized community.

Blogging is holding its own in the digital landscape, and bloggers earn rich passive incomes from monetized websites through affiliate marketing and ad networks. You can create websites for anything, from selling subscriptions to offering tips and advice or curating collections to sell.

Trade online – and start building an eCommerce empire.

This can include starting an eCommerce channel or getting into the finance game. Trading online can range from drop shipping to reselling vintage items; trading in forex to trying your hand at crypto; or buying bulk, packaging items, and then selling them to retailers. So long as you’re exchanging goods and services for income, you’re trading online.