Are you approaching retirement? How is your retirement plan unfolding? I talk a lot about retirement planning for the average person so we can break the fixed income mindset.
Your retirement plan most likely consists of a 401K and social security. Your 401K is at the mercy of the stock market, and social security is in the hands of politicians (scary).
How can you take a little more control of your retirement? In the last article of Retirement Plus, we talked about dividends to supplement your retirement. Today, we will build an income stream from creativity.
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What are royalties? Royalties are payments as people consume your creative works. Royalties are inconsistent at best; thus, we cannot make hard commitments to use them—don’t pay expenses with royalties.
Making royalties steady. But, we can make royalties into steady income by first investing them. In “From Dirt to Dividends (part one, part two),” I discuss using gardening and livestock to build a portfolio of preferred shares and closed-end funds.
It would be the same thing here. When I receive royalties for my books, I would immediately invest them into the stock market or Fundrise. Therefore, I will always receive a return on my investment.
How Much Do I Need for Retirement?
Royalties for fun! If you already have enough dividend income (congratulations), you can use royalties for fun adventures. You can go to restaurants, trips, and shopping on royalty income because it will be “extra.”
I have been earning royalties for a little over a year, and they are awesome. I get royalties from my Amazon books, website, and other book stores. So far, it hasn’t been anything massive, but I can feel the tides turning in my favor.
Getting started with royalties. Whether you use royalties to build dividend income or fun, you’ll need first to build your body of work.
Building a body of work is a polite way to say, “grinding your ass off” until you have a massive back catalog. There is no easy way to say this, “You’re going to have to work many hours.”
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If hard work scares you, then being creative is not for you. Today’s world moves at the speed of light; thus, you’ll need fresh content every day. If you follow a musician on YouTube, watch how many videos they put out every month.
In the past, artists would put out 4-5 music videos per album, start touring, take a break, and return to the studio after a year. Today, artists are constantly putting out music and music videos.
Artists have to stay “top of mind” to gain and maintain traction. The good part is that when someone new finds them, they have a massive back catalog of music for the person to become familiar with them.
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It’s all about the back catalog. Once you have a massive back catalog of music, art, photos, videos, books, etc., you’ll be heading in the right direction.
Roughly 5-10% of your back catalog will be evergreen, which sells consistently. You’ll build a foundation of income. Then you’ll have random items to sell at sporadic times.
The second book I released took over a year to sell a copy—it’s funny how that works. You will still need to create work to remain relevant, but you can slow down a little at some point.
If you are serious about building lifelong royalties, prepare yourself for 10-15 years of grinding. The good part is that royalties will keep you busy into your retirement years. Essentially, you are building yourself a job with royalties.
Retire Early as a Well-Rounded Millionaire
Branching pathways. One of the best aspects of royalties is adding additional streams of income to your creative works. I first read about multiple income streams in royalties in a few books.
“How to Blog for Profit” showed me how to create multiple streams of income on my blog. “How to Make a Living with Your Writing,” told me how to expand my income via writing. Finally, “Creating Income Streams” gave me multiple paths to create income via various tasks and duties.
You can find some examples of multiple income streams via music videos. You get the royalties from people watching your videos; however, you can advertise clothes, alcohol, and cars inside your video.
If you are a YouTuber, you can become an affiliate marketer for Amazon or Audible. Once you create your video, these income streams become passive. People watch your video, and 1-2% of viewers will buy something you offer. The income starts to trickle into your account.
I Live Paycheck to Paycheck 2
Get started now. How much longer do you have before retirement? The best time to build your income stream was ten years ago. The second best time is today.
Yes, your initial work will suck—that is part of the process. You can’t wait to become good at something before starting. Just work hard and get your bad work into the world. People may laugh, but I guarantee it’s more than they do in life.
Anyone who has created something in life will not laugh because they know how the process works. So get started today by reading, recording, or talking into the mic. Make sure you create every day and improve significantly.
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Conclusion. Royalties are a great way to create an income stream and job throughout retirement. I plan on spending 4-5 hours a day on my book business during retirement. I can even do all my business during the middle of the night.
I have 3-7 years before I retire from the Marine Corps, and my business is moving at a nice pace. I love being in control of my own business and income.
Eventually, I will build enough search engine optimization for people to find my blog and books from Google search. This will bring organic traffic to my brand.
So things can slow down over time, but that initial grind prevents many people from getting started. If you want to build an income stream, a brand, or a family business, you’ll have to put in the effort now. Good Luck!
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Disclosure: I am not a financial advisor or money manager, and any knowledge is given as guidance and not direct actionable investment advice. I am an Amazon Affiliate. Please research any investment vehicles that are being considered. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article. All Right Reserved Military Family Investing
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