These days, it’s unheard of for people to wholly rely on a single source of income. This is especially true for younger people. Sometimes it’s a matter of supplementing the income they earn from their day jobs to just making sure that they earn from other talents that they possess.
Between having multiple income streams, it’s easy to get lost in the quagmire of lifestyle inflation and wanting to rapidly ensure their future. One thing that should be the priority is ensuring that they have basic income.
What is basic income?
Basic income is money anyone receives that is sufficient to meet the basic needs of an individual. This means money needed for food, water, shelter and clothing. It’s an amount to keep one’s head above water and above the poverty line without actually spending lavishly.
One other way to define basic income is that it is an income stream that’s wholly independent of any other income that can be used as a baseline. It’s never meant to prevent, but to enable someone to earn additional income.
It’s a concept that has existed since the 16th century, and one that exists in various forms thanks to the proliferation of technology. It shares some similarities with the system of saving for an emergency fund, but the difference is that emergency funds are used as an income buffer in case of the loss of one’s main income stream, or should an emergency event occur.
What it does
Creating an income stream to function as one’s basic income means having an “income floor,” meaning that no matter what, an individual will never be without their basic necessities. In his piece Basic Income for Medium, Scott Santens discusses that basic income would allow people to have an easier time meeting some needs, but not all of one’s needs.
Being able to meet basic needs regularly would – in theory – allow people to be more motivated to work to meet other goals, possibly even other things that they want in life.
In one way, it can transform the way one looks at their jobs. For people who have established basic income for themselves, it provides a view of never settling for less than what their basic income streams can earn them – and according to many surveys, such as the 2016 Deloitte Millennial Global Survey – this and self-worth are why many younger people struggle with staying in jobs for the longer term.
The survey reported that more than 66 percent will choose to leave current positions by 2020 in order to pursue other “adventures.”
How to get started
Building income that will eventually function as one’s basic income isn’t easy, and involves plenty of legwork all on its own. For some, it will involve cultivating their talents even further – such as converting a small freelance business into something larger and more permanent.
The Philippines is a society where the Art of the Raket is something that even the generation before this one already had a handle on, and these days, more and more people are taking that art and bringing it to new heights.
Basic income is about having financial security in as much as covering the rent, being able to buy food, and pay the bills. It allows people an even larger sense of agency where their finances are concerned, defined as making the “right” or “wrong” financial decisions and learning from them.
Others may already have basic income, some don’t, and for those that don’t yet – consider for a moment what your life might be like if you didn’t have to worry about taking care of the basics.
Miggy Castañeda writes about personal finance for MoneyMax.ph. He has also contributed pieces to Yahoo! Philippines, ABS-CBN News, and Rappler.com. MoneyMax.ph is a financial comparison website aiming to help Filipinos save money through diligent comparisons of financial products.