When it comes to building an online business, it is all well and good for us to talk about our financial goals. Although setting goals is one of the first steps everyone must do on this path, the more important topic to discuss is what we're actually doing to make those goals happen.
It always makes us angry when bloggers jump into the scene, seemingly out of nowhere, and say that they're making $125,000/year online without giving any details on how that actually happened (or accurate details, at the very least). In chronicling our own journey, we knew that we did not want to skip ahead five years and say " we did it!" without taking you on the adventure with us, good or bad.
So while we are still at the beginning of our journey, and only 10% of the way to our goal at the time of publishing this post, we thought it would be worthwhile to highlight all of the potential revenue streams we're chasing to make our dream a reality.
You've got to start somewhere, right?Generating Passive and Active Income Streams
There are two kinds of income streams that we're aggressively pursuing in our business: passive and active.
In a perfect world we would achieve all of our earnings through passive income. These streams include things like direct advertising, book sales, affiliate programs, and image sales where a period of up-front work is required but income comes in on its own once the main work is completed for months or years on end.
Unfortunately for passive income, it is unpredictable at best. One week you could have fantastic revenue and then have a month (or more) of dry spells, which is exactly what we're seeing right now on Living the Dream.
To make this income stream work, I'd have to be making a significant excess in the good months to be comfortable with the variability.
The second kind of income stream, one where there is much more potential, is in active work. This includes things like consulting, freelance writing, paid travel assignments, and other business ventures we have lined up but haven't launched yet (I know, I know, always the mystery with us).
Like passive income, the active income stream does have its downside. While it can make significant money, it also consumes your time. To build a lifestyle that allows for having more time while also making the amount of money we need to live our dreams, we need to balance both.
So, what are we working on right now? I'll give you a hint: most of it has nothing to do with Living the Dream.
Living the Dream's Income Streams
To achieve our dream income through our businesses, we have decided to diversify our options. This allows us to make income from all of our skills and also compensate for the fact that, by themselves, no single item is good enough to reach our goal at this time- if at all.
Before getting into it, it is worth pointing out that we are planning in-depth features for each of these income streams with information on what we do, how you can make money on it, and just about everything you'd need to know in the future. (So be sure to check out our Lifestyle Design series to stay up-to-date with our progress.) But for now, lets look at the main ways we're working at reaching our financial goal of $125,000/year.
Passive Income
As I mentioned previously, I would be more than ecstatic if all of our income came from passive income- the orange items in the above chart. How do we intend to get there? The following is our current list of ways we are monetizing our sites and expanding into the future:
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Advertising: The bulk of our income at this time comes from direct advertising on Living the Dream. While the income can be decent, it is also unreliable and, to be honest, not the kind of money we want to be making as it directly alters the content we produce. Although I suspect our ability to bring in more advertising income will rise past the $500-$1,000/month we're making now, especially as traffic increases, the potential on our sister site Discover the Burgh is far greater thanks to the niche we are targeting (we project that site to bring in about 4x as much as we do here at similar traffic levels).
- Current revenue: $500-$1,000/month
- Estimated revenue: $5,000+/month
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Book Sales: We self-published our first book, The Long-Term Traveler's Guide, in 2012 (and are currently giving it away if you subscribe to our newsletter) and will be publishing 3-5 more in the next few years. I do not suspect these to be big earners unless we begin getting book deals; however, as a means to grasp our hold on the marketplace as being an expert on a given topic, a self-published book does wonders.
- Current revenue: $0-$10/month
- Estimated revenue: $0-$100/month
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Amazon Affiliates: Linking to products that we use and recommend via Amazon is one of our preferred outlets as we can recommend products we actually use, receive a commission, and not result in a price increase to those who make a purchase. A win for everyone! After our recent traffic surge, our monthly income from Amazon is around $100, and with more dedicated posts coming out across both Living the Dream and Discover the Burgh we'd like to push this to around $1,000 per month.
- Current revenue: $100/month
- Estimated revenue: $1,000/month
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Hotel Affiliates: We're fairly confident that hotel affiliates will be the primary income stream for our destination specific site, Discover the Burgh. As Pittsburgh brings in about 8,000,000 visitors per year, and the average hotel stay is about $100 per night, inserting ourselves into the affiliate marketplace only makes sense. How big of chunk of the $10,000,000+ affiliate pie can we get into? That is one thing we want to find out, but even a fraction of a percent would be fantastic in terms of income.
- Current revenue: $75/month
- Estimated revenue: $500-$5,000/month
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Other Affiliates: We feature numerous websites, products, and services which offer affiliate commissions (all of which we actually use), and are currently starting our promotion to bring in sales. As our Lifestyle Design and Blog Your Trip series focuses on how we're running our business in this quest for digital independence, you can be certain a few affiliate links will pop up time and time again.
- Current revenue: $50/month
- Estimated revenue: $500-$1,000/month
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Image Sales: In having about 70,000 photos from around the world, and another 5,000 locally (growing by about 1,000 per month), you can imagine that we have quite a bit that are very good (about 3,000 by our count). We have these available for personal image purchase, commercial use, and also on print-on-demand products on several sites and plan on increasing our collection more in the future.
- Current revenue: $0/month
- Estimated revenue: $500/month
Active Income
As I mentioned earlier on, it is unlikely that we'll ever reach a point where passive income will sustain us income-wise 100% of the time. As a result, we're also looking at some active income streams to help get us there on a more consistent basis while the passive streams are improved upon. They include:
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Consulting: In late-2014 we launched a travel consulting services to assist long-term travelers in planning their trips which brought in a few purchases throughout 2015. We are also planning on launching one or two more consulting services in 2016 across our sites.Much like the book sales above, these may not be in high demand, but do a lot to strengthen our credibility as we're putting our knowledge on the line to help our clients out.
- Current revenue: $0-$200/month
- Estimated revenue: $500-$1,000/month
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Freelance Writing: Much like how we pay our staff writers here at Living the Dream, we periodically contribute to websites in exchange for payment. The income ranges from just a little ($50) to a decent payment ($150 or more), and the assignments can be a one-time thing all the way to a long-term deal for multiple articles per month. Although this is not my preferred method for generating an income, it is always an option that seems to come up a few times per year.
- Current revenue: $0-$300/month
- Estimated revenue: $0-$750/month
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Paid Travel: One of the more interesting developments in the travel blogging world has been the evolution of paid assignments where we not only travel on an itinerary, but receive a daily stipend as well for our time and work (often with increased deliverables to warrant the charge). We do not pursue this model aggressively now, but it is on the radar for the future as our site's grow- both locally and internationally.
- Current revenue: $0/month
- Estimated revenue: $0-$2,000/month
- Other Business Ventures: We have a lot that we're working on behind the scenes right now, and when they launch you'll hear more!
Investment Income
Ah yes, this is the one that should come up more with people who have instant success with their websites, because what is often missing is that they already had a crazy monetary backing to begin with to make their success happen.
It is pretty obvious, but we do not have that.
In fact, we drained our entire savings on our last long-term trip, so although we make a very good income from our day jobs now, and are making a modest income from this site, our reserves are essentially zero. That doesn't mean that investing will not be a part of our future, and our plan is simple:
- Investments: We're aggressively investing in our 401k plans (with full annual contributions on the radar within 6 months) as well as planning individual investments with money we have left over. We may not live off of any of the investment money we're putting in now, but we want to be covered in the future when it comes time to withdrawal.
Unknown Income Sources
The final income stream that we may build our business through is all of the unknown streams that we cannot anticipate right now. As our skill set grows and the industries we work in evolve, some (or more likely, many) of the income streams we have listed in this article will not be relevant and new plans will have to be made.
What will come up in the future? Will we succeed like crazy on one item? Fail on all of them? Start something new altogether? Resort to Airbnb'ing to make up the difference? Or perhaps work at our day jobs and be fine with that?
So, now we have to ask you: Do you have any experience making money or earning a living online through passive or active income streams? If so, comment below to let us know about it!We are anxious to find out, and are excited to be bringing you on this journey with us!
