No matter your financial situation, people almost always end up with just enough money to get by. Why is it that middle class people with good careers end up worrying about money? And is their belief that financial security is equal to job security well placed? Let’s check it out…
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The Middle-Class Mindset
We have worked alongside so many professionals in our time who honestly believe that they have made it.
They have embedded themselves successfully in a well-paid career at a young age and now all they must do is show up to work 5 days a week for the next 50 years until they retire, at which point their company pension will pay for several years of pottering, and then finally, their nursing home.
We do joke, but honestly, we don’t understand why people think this is a successful life strategy.
Unless you’re one of the lucky few who have a truly fulfilling job, you’re going to realise by the time you’re in your thirties that you’ve wasted your best years and are looking likely to waste the rest.
Surely a better life plan is to escape the fear of job dependency early on, by changing your life goals to those of pursuing multiple passive income streams.
Unable to Save
We believe that almost anyone can save enough money aside each week to invest and build up a portfolio of assets and side hustles to allow them to retire early, and the middle classes are especially well placed to do this.
A middle-class household earning £60,000+ a year shouldn’t struggle to set aside many thousands into an investment pot, and yet they find themselves unable to save anything.
Money flies out of their bank accounts as fast as it goes in. Credit card payments, car financing of Audis, huge mortgages on huge houses inhabited by 1 couple, multiple exotic holidays, the latest iPhone at £60 a month, £10 monthly subscriptions to everything going, and of course avocados on toast!
Their issues are twofold – they cannot save what they earn, and everything they do earn comes from one source – their job, where they trade vast swatches of their time for money.
Changing the One-Source Mindset
We remember what it felt like to have one income stream. Powerless, dependant on an employer, unable to challenge.
How secure is a job when it can be taken away on the whim of one boss?
Starting in our twenties, we both ploughed our spare cash not into car finance schemes nor the back pocket of a bank manager, but into cash flow generating investments – stocks and funds, property, P2P lending and business ventures. No matter how small, we started, and you should too.
As a result, we are no longer totally dependent on an employer’s handouts to survive financially. And each passing day that dependency gets smaller.
Job Security?
Income from assets can’t be taken away from you by a boss – it’s why we believe that household finances based on passive income is more secure than just having a job.
Now that we’re in our thirties, we have income from multiple sources. We each have healthy investment portfolios, we make a bit from Money Unshackled, and yes, we still have employment income. But this is always becoming a smaller piece of the pie as we focus on the things that matter.
We are not reliant on that employment income – we use it to build our portfolios faster, or to buy the things that others would take out crippling financing deals to acquire.
We tell you this not to brag but to demonstrate what a little proactivity around your finances can do to your life.
Multiple Sources of Income
Don’t mistake multiple income sources with working multiple jobs. That isn’t what we mean. Really, people only have the time to work one job – anything else is asking for mental overload.
No; your non-job income streams must be either passive (requiring little or no effort on your part), or a side hustle business.
This will hopefully be something you enjoy and can do in your spare time, which hopefully frees up time in the future.
There’s no reason that the middle classes couldn’t divert huge amounts of money and effort into setting up investment portfolios and side hustles – but they choose not to. They are choosing short term pleasure over long term success.
Killer of Ideas
We hear it all the time from career employees – “if I only had an idea, I’d love to start a business” or “if only I had the time to look into it, I’d love to learn how to invest”.
The fact is, when you give the best hours of your day to working on someone else’s dreams, all your creativity goes to the benefit of your employer and their shareholders. You are too tired in the evenings to let ideas bloom.
How many years have you dreamed about having that one idea that would set you free financially?
Shifting the Balance – Time vs Job Income
If you want to set up multiple income streams, at some point you’re going to need more time on your hands to work on what you love.
If you can get to the point where you can afford to work part time, maybe a 4-day week, you will free up precious time to invest into yourself. But for now, you will have to sacrifice evenings and weekends to set yourself free.
Remember – you don’t work for someone else – you work for you!
Have you managed to avoid being Middle Class and Broke? Tell us about your multiple income stream ambitions in the comments section below.
