In the previous article on living the 2-hour workday I introduced the concept of travel buffers, cash created either through saving or selling assets that is designed to give you a buffer of capital you can comfortably spend if you need to while you travel.
Travel buffers are mostly for piece of mind so you can relax while you travel or use in case of emergencies, but ideally speaking it’s better if you don’t dip into your capital while you travel. In order to facilitate this, you need some form of consistent income streams that are greater than your total expenses, including costs to travel.
What Is Event Independent Income?
There’s an inherent weakness with this type of income – you have to do something, often significant work, to get the result, or once you do it’s difficult to repeat, for example once you sell an asset, it’s gone.
Conducting a launch is definitely NOT two hour a day work, it takes a lot more than that. Depending on how you travel it’s quite possible to integrate periods of time where you conduct a launch, for example I did a reopening campaign for Blog Mastermind while traveling in Toronto, resulting in well over six figures in income. However to complete the work required to conduct the launch, I had to settle in Toronto for a summer, renting a house and effectively living there as a local.
You can choose to travel, stop and work, then travel some more, if you depend on event income like launches, but if you really want true flexibility and never want more than a two hour a day work commitment, then you need to develop some event independent income streams. In other words, you need money that is either completely passive, or nearly-passive, consistent as a result of working only two hours a day or thereabouts.
The challenge with this sort of money is keeping it consistent. So many systems for making money online are fantastic as one-hit-wonders, and they work again and again in different niches, but the problem is the amount of ongoing work required to keep things going or to get started in the first place.
Sure you can outsource much of your work (I’ve got a couple of great podcast interviews about outsourcing coming up soon), which is a great strategy especially when you have a system that is already making money, but it takes time to do this and still you have the challenge of always staying one step ahead of the market or finding new markets to enter once one dries up, or the competition catches up.
In my case I’ve always had a solid independent income stream that’s served me well for almost ten years now.
So what is it? Read on to find out…
The Magazine Model
My very first source of online income was selling things on eBay, a short lived experiment that I had no desire to continue once I ran out of things I wanted to sell (you can read more about my early days making money online in my four part series starting here).
The next income stream I created has served me well for years, even before I was a blogger, but it works great on blogs too. I’m talking about website sponsorship.
I’ve always been a fan of magazines. Back when I was a kid I spent a heck of a lot of time reading magazines about video games, during the Sega vs. Nintendo days (for you 80s children like me, I’m talking about the Master System, NES, Megadrive and Super Nintendo). I actually enjoyed reading about and anticipating games and new consoles more than I did playing them.
Although I didn’t realize it at the time, my love of magazines very likely translated into a love of web publishing, as owning a website is a lot like owning a magazine. This idea can carry all the way through to today, as owning a blog is a lot like owning your own little fanzine about a subject.
My first successful website, about the card game Magic: The Gathering, was my first successful case study of running a magazine, although it was a bit more interactive than paper, one of the wonderful features of the world wide web. I wrote the content myself and eventually brought on volunteer writers and integrated user-generated content tools like forums and chatrooms.
In the Blog Profits Blueprint I introduce the concept of the magazine model for making money online and dissect it further inside the Blog Mastermind coaching course. As I explain, most bloggers begin using the magazine model as it is the simplest to get started with.
The magazine model simply means you make money from advertising. Your job is to create an entity that has enough attention that you can translate that attention into an income source. This is exactly what I did with my first successful site, and later did with my blogs and other websites I have owned.
In a way, the Internet is just one massive magazine shop, or like a free newspaper funded by advertising income. Understand this and you will understand one of the oldest business models in the world – the publishing model – and it applies just the same, at least in principle, to the online world. It’s the same model, just with new tools and formats, with the same goals – getting the attention of, and influencing people.
I’m not going to break the magazine model down too much in this article as I’ve talked a lot before about the elements in previous articles on this blog. If you really want a detailed description, check out my archives (in particular read my series beginning here – Is Professional Blogging A Sustainable Business Model?), study the Blog Profits Blueprint again and if you’re really keen, join my coaching program Blog Mastermind.
Simply put, selling banners and text links and other forms of sponsorship media on a website or blog is a great independent and consistent income stream, providing you are willing to do the work to keep publishing new content so people read your “magazine”.
My Magic: The Gathering website taught me this. During the five or so years that the site was in my charge and big enough to make money, I had banner sponsors, some of whom sent me cash month after month for YEARS.
It was because of this experience that I later developed a near-passive income stream on my blog, although it took a bit of tweaking to come up with something completely hands off for me.
So how good is this income stream?
Well I can say that I’ve been writing to this blog for almost five years, and for almost four years of that time I’ve made at least $1,000 a month, every single month, thanks to sponsors.
For the last three years it’s been somewhere between $2,000 and $3,000 a month, and that’s only from banners and text links, no sponsored reviews, no affiliate marketing, just advertisers paying a monthly fee for exposure to my audience.
Consistency is impossible to judge without time passing, so I’m confident now when I say that unless some major shifts occur online, either to my business or the industry it operates in, the Internet or society itself, this money will continue to come for as long as I keep blogging. It’s stable, independent and consistent, and has been for years.
What Is A True 2-Hour Workday?
When people challenge me that there is no way I can work just two hours a day, I agree, I don’t work those few hours if I counted up the time I spend on projects that have the potential to make me money.
Although defining what “work” is invariably becomes important if you want to get semantic about a true 2-hour workday, what I can say to you is that I have made enough money to live off quite comfortably just by writing my blog.
You could take away my products, the income from assets I’ve sold and even the affiliate revenue and leave just me, my blog and my sponsors, and I’d certainly only need to spend two hours per day to keep it running, and generate what most people in western culture earn in a year.
You could live like a king if you chose to do this outside of the wealthiest countries with the strongest currencies, for example if you lived in Asia, or Eastern Europe or South America.
In Australia where I live, if I earn $3,000 US dollars a month, I’m not rich, but that’s enough to get by. The challenge of course is what would you do with the rest of your time if you only need to work two hours a day, and I expect like me, you might choose to use at least some of that time for more business projects and increase your earnings, or you might just keep doing what works and increase the return you get from it.
There’s no reason why you can’t double your traffic to get a similar increase in advertising revenue, if you keep giving people what they want in terms of content (your magazine becomes more popular).
Stress Free Living
Imagine this: You’ve saved up a nice travel buffer, perhaps $20 or $30K, enough to live on for a year. You’ve got an income stream that’s consistent and keeps coming month after month as long as you spend a little time each day doing something you love (in fact, the money is a by-product of doing what you love, you don’t actually have to do anything to “create” the money, it’s passive as long as you keep creating value for other people).
You’ve got ample time, you enjoy the work you do although you don’t have to do it for long, and you have countless opportunities in front of you.
Sounds good doesn’t it? Yeah, I know it is because I’ve been living it (and then sum) for the last few years.
Making money from sponsors is not the only way to develop an independent income stream, but in today’s content-drive Internet, it’s one of the best ways, especially if you’re passionate about something.
If you really understand what I’m saying here, advertising income isn’t really the “answer”, it’s just one of the options available to you, if you choose a model that results in you becoming noteworthy in your industry.
As Ed Dale recently told his 30 Day Challenge students, you don’t need to be the best expert at something, you just need to have passion. Leveraging passion to establish authority, and build your tribe (ala Seth Godin), is the key.
This method is so much easier than any other way of making money because it rewards you for being passionate. It doesn’t focus only on the money, or the system or trends that are changing. It’s about you and how that something about you can translate into value for people who share your passion or have a need that your passion can meet.
The reason why you can make money from an income source like advertising, be confident in your future because you know it will be consistent, and work very little to keep it coming in, is because you’ve established status that can’t be easily taken away. That status results in consistent traffic, and thus revenue, because you’re willing to do a small handful of things (create content) to maintain it.
Sponsors may come and go, but if you are a leader, there’s always another company who wants to be associated with you and willing to spend money to do so. What’s important is what you’ve built and what you continue to accumulate day after day, even though it only takes a little time to do so.
This is yet another reason why, as I traveled for 8 months of 2008, I was financially secure. I have an income source that covers all of my expenses as long as I write a handful of articles to my blog each month, which I love doing of course. This income stream means that most of the other money I make becomes capital as my expenses are covered. It’s all gravy from there.
How Can You Create Independent Income Streams?
If you want to develop some kind of independent income stream, owning a website – which a blog is a great option – and then selling advertising from it, can work really well. Hopefully since you read my blog, you’re already taking steps to achieve this outcome.
If you don’t make much money from advertising right now on your websites or blogs, don’t worry too much, everyone who has ever made money from advertising grows through this period. When I first wrote this blog I didn’t make a penny from advertising for a good six months, and even after that it took a long time to get things going.
The challenge with advertising is that it’s relational to traffic. If your blog has low traffic, it’s harder to get sponsors and you can’t charge much. Once momentum kicks in you can charge more and it becomes easier to get more sponsors, in fact you may not have to do anything at all, they will come to you. Just as you do with your target audience/customer when you develop an avatar, consider your target sponsor and their motivations (a “sponsor avatar” if you will), and you will understand what it takes for your blog to be worth spending money on in their eyes.
Your job, is to focus on value creation and marketing. You must blow people away with what you give them, asking for nothing in return and then, and this is work, put in above average effort to get out there and use the marketing tools available to show people what you offer. Doing this every day, provided you are operating in a market with enough people, will work, I guarantee it.
If you’re looking for more specific advice regarding selling advertising on your website, including how much traffic you need before you start making money, have a read of one of my earlier pieces (May 2005 – this blog really is getting old!): How to make money from your website selling advertising and once again, if you are really serious about making money from a blog, taking my Blog Mastermind coaching program is definitely the fast track option.
So now you have two components that can help you lead a 2-hour workday and travel the world if you so choose. Travel buffers give you piece of mind and independent income streams keeping you going. It’s not easy, but this lifestyle is available to ANYONE who wants to go after it. The first step is to commit making it a reality by taking action every day.
Blessed To Work