How to Diversify Your Income: 31 Profitable Ideas

Want to create multiple income streams but don’t know where to start?

Then you’ve come to the right place. Today, we’ll cover how to diversify your income the right way.

By the end of this article, you’ll know which ideas are the most profitable and the steps you need to take.

Curious to learn more?

Read on!

Biggest takeaways: 

• Diversifying your income helps you create savings and build more safety in your life 
• You can diversify your income in various ways, including a side hustle, a part-time job, or investing 
• One of the best side hustles is a coaching, consulting, or freelancing business because you can use your existing skills 

Why should you diversify your income?

Do you know how rich people thrive? Well, for one, they never stick to just one income source.

And guess what?

Diversifying is a smart move for you, too.

Here’s why:

• Safety: You have a financial cushion if you lose your job or a business fails
• Savings: Extra income can fund big purchases, dream vacations, or your bucket list adventures
• Financial freedom: Instead of stressing about bills, you build a life of freedom
• Experience: Each new income stream teaches you valuable skills
• Autonomy: Not relying on a single paycheck gives you more control over your life and career choices
• Future options: With more income, you could eventually decide when (or if) you want to leave your day job

Sounds good? Then, let’s take a look at the top ways to diversify your income.

Top ways to diversify your income

First up, I know passive income is all the rage right now.

But my advice? Balance both active AND passive income streams.

What’s the difference?

Active income comes from activities you actively manage. You put in the work directly and get paid for that.

Passive income is about setting up systems that create revenue with minimal daily effort. 

Passive is often misunderstood as effortless.

But here’s the thing:

Passive income does require initial effort and ongoing management. But once you’ve laid the groundwork, your returns keep growing despite less active input.

Now, what are your options when it comes to diversifying your income? Here are some useful strategies:

• Primary job or business: Your main source of steady income
• Side hustles: This can be anything from freelance gigs to selling handmade goods online
• Digital products or services: Ebooks, courses, or subscriptions you create once but sell repeatedly
• Investments: Stocks or bonds that earn interest and dividends over time
• Rental income: If you have property, renting it out is a good source of ongoing revenue

Having several income streams is clearly a great idea. But what are the best options?

Let’s cover that next.

The 31 best ideas for diversifying your income

There are many ways to diversify your income. All can help you achieve your dreams of financial freedom, but these are the best.

Let’s take a look!

Online courses

Online courses are first on the list.

What makes them so awesome? They’re:

• Easy to set up
• Very profitable
• A good source of passive income
• Highly scalable

The best part, though?

You can literally make a course about anything you have expertise in!

For instance, countless students of mine have launched successful courses across different sectors.

I myself packaged my coaching into an online course, Employee to Entrepreneur, which helps people start a business and quit their corporate jobs. While I still coach to some extent, online courses have helped me scale my business profitably. 

To get started, check out my fail-proof plan you can use to create a high-quality online course:

Coaching

Coaching is another great way to sell your expertise.

Through coaching, you help clients improve in areas you’ve already mastered.

Like with courses, you offer a valuable transformation. This makes this business idea highly profitable.

In fact, many of my students pull in six to seven figures just from coaching!

The key?

Carve out your niche.

Decide who you want to help with what. Niching down makes your approach super targeted. 

This specialization adds more value for your clients, and it makes you the expert they need.

For more advice on finding your coaching niche, check out this video:

Consulting

Consulting is like coaching, but the difference is you tackle specific client problems head-on.

You’re still making money from your expertise. But instead of guiding clients, you’re directly solving their challenges.

You:

• Analyze data
• Identify issues
• Develop strategies
• Implement solutions
• Check your impact
• Show clients the results

Consulting is all about offering high-value solutions. This makes it a very profitable business.

You can get started with skills you already have. That’s how I started my first online business, a digital advertising consulting business. 

If you want to dive deeper, I lay out the eight steps to start a consulting business in this article.

Freelancing

Freelancing lets you use your current skills to make money on your own schedule.

You work with various clients and projects, which is already a way to diversify your income in and of itself.

Starting is straightforward with platforms like Upwork.

You can also specialize in skills that are in high demand and command higher rates, like:

• IT support
• Programming
• Digital marketing
• Web development
• Copywriting

However, remember that freelancing is not a source of “passive” income. Instead, you’re trading your hours for money.

Side hustle

With a “side hustle,” I mean smaller activities like:

• Pet-sitting
• Handyman tasks
• Driving for rideshare apps
• And so on

These are generally not very lucrative. But they can still bring in some nice extra cash.
Platforms like Fiverr and Taskrabbit are perfect for kicking off most side hustles.

To earn more, you can:

• Offer premium services
• Scale by hiring contractors

In this video, I share my four favorite side hustles you can start right now:

Investing in the stock market

Since its start, the S&P 500 has averaged an annual return of about 10%.

Today, it’s super easy to invest with apps like Robinhood and E*TRADE.

And guess what? The sooner you start, the more you stand to gain.

That’s because the magic of compound interest works best over time.

Simply put: With compound interest, your money grows as it earns interest on the interest. So, getting started sooner is better than later.

Investing in real estate 

Do you own a property? Then you can make money through:

• Rental income
• Selling for a higher price

While it can be lucrative, real estate investing does come with its challenges…

Unless you hire a real estate pro, you’ll need a deep understanding of the local market and rental demand.

Regular property upkeep is also time-consuming.

But one of my students, Ryan Chaw, specializes in this field AND he helps new people get started, too! 

Write an ebook

If you love to write, publishing your own book can create some nice passive income.

This is what the process would look like:

• Write about a topic you know well
• Format the book
• Design a cover
• Publish on platforms like Amazon Kindle or Apple Books
• Market the book

Don’t enjoy writing? You can still share your story or knowledge by hiring a ghostwriter to write your book. Upwork is a great site to find freelancers offering this type of service.

Speak professionally 

Do you feel comfortable sharing your expertise on stage?

Great, because it can be a good source of income as well.

(And even if you’re not comfortable YET, it might still be an option. Take it from me — I’ve been there…)

Here’s how you can boost your earnings as a public speaker:

• Target high-paying niches like corporate events
• Create workshops or personalized coaching sessions

Keep practicing, keep reaching out, and eventually, you’ll have more confidence and clients. 

Affiliate marketing

Ever thought about making money by sharing your favorite products?

That’s the core of affiliate marketing.

This is how it works:

• You promote products or services through your blog, social media, or email newsletter
• Each time someone buys via your shared link, you earn a commission

My advice is to grow your audience in other ways first. Then, use affiliate deals as an extra income boost.

For example, I sometimes do affiliate promotions – but only if I really believe in the product and know the founders.  

Brand partnerships

If you already have a following, collaborating with brands is a good way to add in an extra income stream.

The challenge is building and maintaining relationships with your audience AND the brands.

That’s also why it’s so important to pick out businesses that really match your audience’s interests. You’ll make money and honor your audience’s trust in you as well.

Flip products

Flipping products means buying items at a low price and selling them for more money.

You can start small and scale as you understand market trends. Plus, the better you know your market, the higher your profit margins.

That said, hunting down deals and managing sales can take up a lot of time. So, keep this in mind before starting.

Sell photography online

Got a good eye for photos? Turn that skill into cash by selling your photography online.

It’s a great way to make money from anywhere in the world.

However, the field is crowded, and getting started often involves buying expensive equipment. But this is an upfront cost, and you can specialize or diversify your services for more money-making options.

Create an app

The mobile app industry is worth more than $200 billion. So, why not tap into this lucrative market?

Start by identifying a market need, then develop your app with user feedback.

Later, you can increase profits by adding premium features or in-app purchases.

The challenges? High development costs and stiff competition.

Rent out parking space

Renting out parking space is an easy side hustle that can offer steady income. 

Platforms like JustPark and Spacer make it simple to get started. But unless you expand to multiple locations, how much you earn mostly depends on the demand in your area.

Host live events

Hosting live events means organizing gatherings like conferences, workshops, or seminars.

Live events can generate revenue from:

• Ticket sales
• Sponsorships
• Merchandise
• VIP experiences
• Food and beverage sales

They’re also fantastic for networking and establishing your authority in your niche.

The downsides? Higher upfront investment means more financial risk, and handling logistics can be tough.

Podcast or blog

Running a successful podcast or blog could be your ticket to ongoing income. Keep in mind that it takes time to grow an audience.

But you can earn money in several ways, including:

• Ads
• Sponsorships
• Sales
• Subscriptions
• Affiliate marketing

You can also sell your own products or services. My own blog (the one you’re currently reading) quickly grew to a multiple six-figure income source.

Not sure where to begin?

Here’s a simple three-step plan to get started:

1. Identify your niche
2. Consistently create valuable content

Grow your audience through social media and SEO

Develop new products or enter new markets

Do you already have a business but want to expand? Then developing new products or exploring new markets might be a good option for you.

As with any successful business, the trick is to find unmet needs and create something that addresses them. Use market research to identify those needs, which I talk about more here. 

Create digital products

Creating digital products means developing online materials your audience wants.

Online courses, ebooks, and apps are all digital products, but so are:

• Templates
• Printables
• Planners
• Digital art

What makes this business idea so lucrative?

Well, since the product is digital, you can sell it endlessly, making it a good source of passive income.

Create software

Developing software involves building apps or systems that solve specific problems.

To get started, you need skills in:

• Coding
• Technical design
• Problem-solving

Once launched, you can generate income through:

• Sales
• Subscriptions
• Licenses

Want to stand out in the hyper-competitive tech world? Then keep improving your software based on user feedback.

Rent out your home short-term

Airbnb has revolutionized the short-term rental market. Nowadays, you can rent out anything from a single room to an entire unit.

It’s a flexible way to earn money — especially if you’re in a popular location.

But unless you outsource some tasks, be prepared to spend a lot of energy on:

• Managing guests
• Maintaining the property

Rent out your car 

Not using your car every day? Then, you could make some extra money by renting it out on platforms like Turo and Getaround.

Boost your income by:

• Maintaining your car well
• Choosing high-demand times to rent it out

Just be sure the cost of wear and tear doesn’t outpace what you’re earning.

Create a YouTube channel

Every month, YouTube has over two billion logged-in users. That’s a massive audience waiting for your content.

As you grow your following, you can monetize through YouTube’s Partner Program. This lets you earn money from:

• Ads
• Channel memberships
• YouTube Premium revenue

Want more income? Then add in additional income streams like:

• Sponsorships
• Brand deals
• Merchandise sales

Rent out products

Peer-to-peer lending means you rent out products to others.

This could be anything from home appliances and toys to surfboards and camping gear.

You can get started by posting your stuff on platforms like Fat Llama or Rentah.

The main challenge? Managing logistics and the risk of damage to your products.

Invest in REITs

REIT stands for “Real Estate Investment Trust.”

You get to invest in real estate portfolios and receive dividends from the profits. Starting is as simple as buying shares through a brokerage, just like stocks.

Of course, market fluctuations still affect your investment, so it’s not 100% risk-free.

Sell art or designs 

If you’re an artist or designer, using platforms like Etsy can turn your creations into cash.

Start by setting up a shop and listing your artwork or designs.

Want to earn more? Here’s how:

• Offer custom commissions for which you charge a premium
• Turn your art into digital products that you sell over and over
• Use social media marketing to increase your visibility

Get a part-time job

Getting a part-time job is often overlooked, but it’s a great safety net.

The type of job that’s best for you depends on your needs.

Are you looking for a simple backup with flexible hours? Or do you want it to be a stepping stone to bigger opportunities?

Start from there.

Create music 

As a musician, diversifying your income can look like this:

• Selling your music on platforms like Bandcamp, Spotify, or Apple Music
• Licensing your music for commercials or films
• Doing live performances
• Teaching others
• Selling merch

The biggest downside is that your income is unpredictable without a solid fan base.

Luckily, social media helps you extend your reach more easily.

Start an ecommerce store 

Launching an ecommerce store lets you sell products directly to your customers.

This direct link gives you full control, but it also means you have to:

• Manage inventory and shipping yourself
• Invest heavily in marketing to attract customers

That’s why I don’t recommend starting with an ecommerce store. It can be lucrative, but the high startup costs and complex logistics tend to overwhelm new entrepreneurs.

Wait until you’re successful in other ways. Then, if you’re still interested, start looking into one.

Buy a small business

By buying a business, you skip the startup phase and dive right in.

This approach can work if you already have experience running a business. But I don’t recommend it as a shortcut to becoming your own boss.

Let me explain…

Without experience, handling daily tasks and long-term plans can be tough. And this expertise is exactly what you need to keep a business thriving.

On top of this, you also need business know-how to check the business’s potential before you invest.

As with starting an ecommerce store, become successful in other ways first, and then look into this option.

Create a newsletter 

Having a newsletter gives you direct access to your audience.

Think that sounds powerful? It is.

Growing a loyal readership takes time, but the potential rewards are big.

For instance, my newsletter played a huge role in growing my business to seven figures.

Besides publishing on your own website, you can also use platforms like Substack.

Now that we’ve gone over the most profitable business ideas to diversify your income, we can talk about how.

How to diversify your income

Knowing how to diversify your income is key to building financial security. But where should you start?

Here’s a step-by-step guide:

• Choose an idea: Align your income streams with your skills, interests, and the time you can commit.
• Research: Get a deep understanding of your market. Who are your customers? What do they want? And how can you help them?
• Start small: Don’t try to do everything at once. Focus on mastering one income stream before adding more.
• Educate yourself: Use resources like books, online courses, and YouTube to set yourself up for success.
• Build an audience: Create an email list. It’s a valuable asset that lets you reach out directly to your followers about new offerings.
• Automate and outsource: Once your income stream is stable, automate routine tasks and outsource as much as possible.

Ultimately, being financially secure goes hand in hand with building a life of freedom.

And to me, that’s the real beauty of having multiple income sources.

What’s next? 

There you go! You’ve just learned how to diversify your income.

Diversifying isn’t just for the ultra-rich — it’s also your pathway to more security and freedom.

Of course, running several successful businesses requires a great strategy.

Curious to dig deeper?

Then, grab my free guide on building a six-figure business from scratch.

It gives you the proven steps to set your business up the right way.

Read more:

How to Start a Freedom Business

The Ultimate List of Side Hustle Statistics

How to Overcome Your Fear of Starting a Business