Automate Your Income to Simplify Your Life

Every Tuesday is Finance & Family Day at Zen Habits.

The title of this post almost looks like the subject of a spam email when I look at it, and yet I’m completely serious — one of the best ways to simplify your life is to put your income on autopilot. It’s not an easy task at first, but once you’ve got it set up, it’s well worth the effort.

Instead of working hard to earn money every day and every month, work hard to set up your income stream, and then do minimal work from then on out to maintain that stream.

I’ve talked before about how to put your bills and savings on autopilot — now let’s look at how to do the same thing with your income. This isn’t an original idea, of course — author and blogger Tim Ferriss talks about how to do it in The 4-Hour Work Week (read an interview with Timothy Ferriss at Write To Done), and my fellow blogger Brian Tracy calls it Passive Income (also see his excellent Five Ways to Create Passive Income). Author Robert Kiyosaki, among many others, has been talking about doing it with real estate for awhile now.

But in this article, we’ll talk a little about how automating your income can simplify your life, and then look at ways you can go about doing it.

Simplify, simplify, simplify
On this site we’ve talked a lot about simplification, from simplifying your to-do list to simplifying your closets and everything in between. The idea is that by eliminating the unnecessary and the clutter in your life, you can have more time to focus on what is truly important, and enjoy more calm and less stress in the meantime.

These same concepts apply to income, although we rarely give that much thought. Most of us work a salaried job, putting in the hours every day to get a paycheck, and that’s what supports our lifestyles. Sometimes we work a second job, to help pay the bills, or pay off the debts, or save. That’s the normal way of generating income, and there’s nothing wrong with it.

But if you give it a little thought, our means of generating income can really complicate our lives. We have a lot of daily stress from our jobs, and the daily grind can be tedious and exhausting. We have long to-do lists and endless meetings and phone calls and emails and interacting with co-workers all day long. A job is the ultimate complication.

Now imagine that you create a small business for yourself, perhaps on the side, or maybe you create a property such as a book or a CD that can be sold over and over again once it’s created. Sure, this will take a huge investment in time and energy, and perhaps money (though not always), but once it’s done, your investment of time and energy is minimal, and the return is well worth that initial investment.

Put in some hard work, and soon a steady stream of money could be coming in, and you only have to put in a small amount of time each day or week to make sure that things are running smoothly. Now your automated income supports your lifestyle with very little work required, and you’re free to pursue your dreams and passions. No more long to-do lists, no more meetings and days full of calls and emails and co-workers. No more commutes. That’s the ultimate simplification.

It’ll take a lot of work at first, but isn’t the simplicity that results worth the effort?

How to Automate Your Income
There is no one way to create an automated stream of income — there are many different approaches. And the details required to implement them would take a book to cover. The following are just some ideas to get you thinking, and to open your mind to the possibilities. I should also note that there is always a risk of failure to any of these types of ventures — nothing’s guaranteed, but with some smarts and hard work, it can be a success.

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