Types of Income & Choosing to Work

Two guys at work have just had babies. For one it is his third child, for the other his first. These guys have both complained that they only get to see their baby for 10 minutes a day. Or that when they get home the baby is already asleep.

Although they work longer than 9-5 (doesn’t everybody these days?) they still get home at a reasonable hour. But they still miss out.

And these guys have high positions in the company.

One of my reasons for investing in my financial education rather than my job is that I’d like to be able to CHOOSE to have a job, rather than HAVE to have a job.

But I need money – don’t I have to have a job?

Everyone needs money to live. But not everyone earns money in the same way.

Types of Income

There are lots of types of income.

Hard Money – Your Job – most earn by Salary (fixed payment per fortnight/month), or Wages (per hour).  If you are a salesman you might get paid by Commission. I also put Self-Employed work in this category (such as tradesmen).

Easier Money – Business profits (you might profit from people who work for you), Trading Profits (e.g. If you buy and sell shares), or Real Estate (where you might get a tradesman to do the hard work).

Easy Money – Passive Income from investments (interest, dividends from shares, Rent (positively geared), Some business profits, Royalties

What would you do if you didn’t have to work?

Now some people say that if they didn’t have to work, they would travel the world and party. But I imagine most people would get bored.

 I enjoy work – maybe I can be a bit of a workaholic. I know that if I stopped working I would miss the interaction and the challenges and the feeling that you are doing something worthwhile.

 Flexibility

But If I had just had a baby I would love a bit of flexibility. The good news is that a lot of workplaces are getting more flexible. Options like working from home and flexible or reduced hours are becoming available.  Or it might be possible to take a year off from work.

Choosing to work does not always work. Like the boss who I heard had to fire his delivery driver a year after he won the lottery. The guy still enjoyed doing the work, but now he was not reliable because he was not afraid of losing his job.

But what if? What if when you had kids you could take a bit of time off to look after them.

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