Just as there are several reasons to outsource your passive income, there are also a few reasons to not outsource that you want to consider before doing so. Outsourcing can give you a clear advantage over your competition and can accelerate your earnings potential. It also has the ability, if managed correctly, to free up an enormous amount of your time that can be used to focus on creating additional streams of income.

Outsourcing your work is not something that you should take lightly. You need to identify which tasks and jobs make sense to outsource and which ones should still be handled internally. Hiring contractors and outside help for your business must be planned and managed properly in order to be considered a success. It is not like you can just flip a switch and everything is automatically handled for you.

While outsourcing your work can help transform your business into more of a passive income stream – there is still some required work on your part. Here are 3 reasons to not outsource your passive income that you should think about.

1. Losing Control – As soon as you outsource some of your work, you lose some of the control you once had. While this isn’t necessarily a bad thing, entrepreneurs are use to being completely in charge. Now you must rely on others to complete work for your business. You will also be required to manage the work of your outsourced help to ensure the contractors are completing their work on time and accurately.
2. Lack of Business Skills – In my professional career, I have worked with many IT contractors who develop various software programs. Some of the hardest working and most dedicated employees I know are temporary or contract workers. While most of these IT contractors are some of the best computer programmers you would ever meet, they typically have one drawback in common – lack of business skills. Hiring outside your company to fill various temporary jobs brings in professionals with little understanding of how your business is run. Depending on the job, it could take some time to get them up to speed on understanding the business to allow them to complete their jobs.
3. Cultural & Language Barrier – There are times when a contractor’s language or cultural background that is different than yours may cause a problem. For example, you probably wouldn’t want to hire a ghost writer to create articles for you who wasn’t fluent in English for use on an English speaking website. The internet has opened up the channels to hire contractors and freelancers from all around the world, which has helped to reduce costs for you the business owner. At the same time, it has also introduced potential barriers you must consider.

While the 3 reasons not to outsource your passive income listed above should always be factored into your decisions – there are ways to avoid them. Taking the time to interview each qualified candidate and checking their references is a must. If you do your due diligence on the resources you plan to hire, you should drastically reduce any negative impacts.

Another preventative measure that can be taken to avoid any conflicts with contract workers is to be an effective manager of your resources. Be sure to define your requirements and expectations with these resources before they begin work and set time lines they need to follow. Communication is the key and as long as you hired qualified and trustworthy candidates, it should make your job a lot easier!

What other reasons to not outsource your passive income can you think of?

Related posts:

1. 5 Reasons to Outsource Your Passive Income
2. Why I May NEVER Outsource Again
3. 10 Simple Reasons Why I am Building Passive Income

Related posts brought to you by Yet Another Related Posts Plugin.

What does financial freedom mean to you? Does it mean that you have enough money each month to cover your bills? Maybe it means that you have so much money saved up that you are free to spend it on whatever you want. Other people may claim that financial freedom is to become completely free of debt.

Those are all okay answers, but the real definition of financial freedom is much more. It is more a way of life than a definition and varies from person to person. Becoming financially independent is having the freedom to live your life as you wish without any worry about money. No more being tied down in that 9 to 5 job or working those extra overtime hours just to make ends meet. Financial freedom allows you to do what you want, when you want.

Here are a few key elements that are critical to becoming financially independent.

Diversified Income Streams

Do you own stocks? If you invest in the stock market, then you have heard the term diversification. Financial experts love to stress the importance of spreading your money across multiple assets. Since you listen to your financial adviser about keeping your savings and assets diversified, why wouldn’t you diversify your income as well?

An important step of becoming financially independent is to build multiple income streams from several sources. If one source dries up for whatever reason, your risks are then minimized. Without proper diversification of income streams, financial freedom will never be possible.

Automation & Outsourcing

Automating your income streams is another important part of becoming financially independent. Nobody wants to work their whole lives, so building passive income streams is critical. One way to create these sources of income that require very little of your time is through automation and outsourcing.

If you can successfully leverage technology to automate your income streams and let outsourcing handle the remaining tasks, you have created a passive model. Provided there is enough money leftover after paying for automation and outsourcing (also known as positive cash flow), then you are well on your way to finding financial freedom.

Lower Your Expenses

It doesn’t take a financial expert to tell you that to be fiscally sound, you need to have fewer expenses than your income. Financial freedom relies on this basic economic concept. If you are able to keep your expenses lower than your income, you will have a surplus of money leftover instead of debt. One of the most important building blocks to financial independence is by living debt free.

Defining Financial Freedom

When it comes down to it, financial freedom is really very simple. Build a set of diversified income streams that can be automated which bring in more income than your expenses. At the end of the day, if your portfolio of automated income streams can support your lifestyle of choice, then you have become financially independent!

How do you define financial freedom?

Related posts:

1. Plan, Do, Check, Adjust Your Way to Financial Freedom
2. 10 Financial Descions I would Like to Have Back
3. Profit in tough financial times

Related posts brought to you by Yet Another Related Posts Plugin.

Over the past several months I have outsourced several projects and tasks associated with building passive income streams. In an effort to save more time and maximize my earnings potential, I decided to take some of my eHow earnings that I had accumulated and reinvest them. On paper (at least to me) this seemed like a great idea.

Unfortunately things didn’t work out so great for me. I had three main projects or tasks that I had decided to outsource which would help me focus more time and attention on other tasks. The details of my experience are highlighted below and are reasons why I may NEVER outsource again!

Keyword Research

One of the first jobs that I outsourced was conducting keyword research for a niche site I wanted to build. I outsourced this job with a set of guidelines (unfortunately not too specific) to conduct some extensive research on keywords and domain names. My plan was to eventually take this research and build a website that would earn a steady monthly income.

The intent for outsourcing this job was to save time. In the end, I probably spent more time working with my virtual assistant (VA) on figuring out what exactly I wanted. I paid my VA less than $4 per hour which seemed great. However, if you throw in the time that I spent plus the double work of my VA, I ran up a ton of hours on this project.

I did find an alternative that has turned out to be much more reliable and affordable. For just a little more money than what I paid for my outsourcing job, I purchased Micro Niche Finder. I have been using this tool ever since and have postponed any outsourcing of keyword research!

Ghost Writing

Another brilliant plan that I thought I had was to begin outsourcing articles using Elance. The idea was to take passive income earnings from eHow and begin paying others to start writing content for various niche websites that I planned on building.

Of the three projects that I outsourced, I found this one to be the most successful. I found that the average rate being charged is about 2.5 cents per word (give or take) for a written article. So for a 500 word article, I paid about $12.50 for someone else to write it for me.

Because of my frugal nature and unwillingness to pay for things, I probably won’t do this again for a while. I got some good articles that I used on a few niche sites (not on PFI!), but am not sure they are worth the cost at this point. Sure, I could probably find someone who would write an article for less than that rate, but the quality would be poor.

I still think this may actually work for eHow, but have decided to continue writing my own content – at least for now!

Thesis Customized Design

The most recent job that I decided to outsource was for a customized look for PFI. I have been (and will be for some time) using Thesis as my WordPress blog theme and think it is great. The only problem is that the majority of other bloggers who think Thesis is great have a site that looks similar.

I ended up outsourcing this work to a freelancer who specializes in customizing websites and blogs. As you can tell, the new look is unique from other Thesis users which I am very happy about. Overall, the designer did a good job finding out what I wanted my site to look like and built the customized look.

Unfortunately there is not a happy ending to my experience. There are still several little things that have not been finished on my site. For example, if you use Internet Explorer to view PFI, then you can see what I am talking about. I have not been able to include several other features that I had originally planned on with this site because of some coding issues.

Originally the freelancer agreed to fix everything on my site at no additional cost. Six weeks and five unanswered emails later with no response, I am now tasked with fixing these issues on my own.

Overall I think I got a good deal for what I paid for my customized look (compared with other freelancer bids). However, I now have a site that is 80% complete and will have to devote my own time to finishing the remaining 20%!

Saving Time vs. Spending Money

In the end, outsourcing for me comes down to saving time versus spending money. The three projects that I recently outsourced cost me a few hundred dollars combined. When I look back a few months later, very little of the money I spent has been able to bring in more income for me. Furthermore, the amount of time I thought I was going to save was not as big as what I had hoped for.

Overall this has been a good experience for me that I wanted to share with my readers. I still believe that outsourcing can be a great tool when building passive income. I will probably be holding off from outsourcing any new work for some time. However, if I can learn from my mistakes, then there still may be a place someday to outsource some of my work!

How successful have your outsourcing jobs been?

Related posts:

1. 5 Reasons to Outsource Your Passive Income
2. 3 Reasons not to Outsource Your Passive Income
3. The One Thing you Should NEVER Outsource

Related posts brought to you by Yet Another Related Posts Plugin.

If you are a business owner or manager in a company, then you may already know several reasons to outsource some of your work. Most of the time a contract or freelance worker comes at a much cheaper rate than a full time employee. In addition, there are times when you or your staff may not have the required expertise to complete a job, which makes outsourcing a viable option to get the work done.

So what about outsourcing your passive income? The key concept behind creating passive income is to build revenue producing activities with the least amount of effort required on your part. Spending countless hours building and maintaining these income sources does not make it passive at all. Therefore, outsourcing should always be considered as an option when you are working towards building a passive income stream.

Outsourcing can also help take a normal business you may own and turn it into an income source that is more passive in nature. For example, you may own a lawn care business where you spend 40+ hours per week working for. Hiring a manager or “outsourcing” your work will free up your time to focus on creating more income producing opportunities. While the example above is somewhat vague, the important thing to remember is to be creative when building passive income streams and think about how outsourcing can help you.

Check out what The Smart Passive Income Blog has to say about hiring a virtual assistant to help outsource your work.

Here are 5 reasons to outsource your passive income work that I believe can help grow your business.

1. Accelerate Earnings – Building and growing successful passive income streams usually takes a lot of upfront time and effort. Many of these sources of income don’t start earning a decent return for some time as they need to become rooted and established. What if you could accelerate your earnings so that you could reach your goals sooner? Outsourcing is one way to accomplish this – provided you allocate your resources to the appropriate tasks at hand. For example, if you are building affiliate marketing passive income streams, why not use some (if not all) of your income to outsource more of this work? You could take some of your profits and hire a ghost writer to create additional content that can be used to publish more affiliate marketing campaigns. This is one example of how you can accelerate your earnings potential through outsourcing.
2. Time Savings – One of the most critical reasons to outsource some of your tasks is the time savings it can provide. Your time is one of the most important resources your business has. The problem for most business owners is that they want and think they have to do every single task for their business to run smoothly. That is virtually impossible and they are setting themselves up for failure as a result. Outsourcing some of your less critical and tedious tasks is a great way to free up your time. That way you can concentrate on the important business decisions that will make or break your success.
3. Frees up Resources – Closely tied to time savings, outsourcing can free up resources in your business. For example, if you have a staff of employees, you can identify their strengths and capitalize on them while outsourcing the weaknesses of the organization thus freeing up resources. The same can be said for non-worker related items such as web hosting and database management. If your organization is large enough, outsourcing some of your IT support could free up server and technical resources.
4. Reduces Costs – Most critics to outsourcing would argue that it does not reduce your costs – especially when creating passive income. On the surface, spending $200 on Search Engine Optimization (SEO) for your blog doesn’t sound like it reduces your costs. After all, you could probably do your own site optimization to push your site hire in the search engine rankings. There are many free resources available today that help teach you the ins and outs of SEO. The problem is that it takes time to research these things which prevents you from completing more important tasks. It may take a hired contractor 40 hours to complete SEO for your site which would come out to $5 per hour. I would argue that your time is worth much more than $5 an hour and that you are reducing your overall business costs.
5. Hire the Experts – As a blogger and owner of several online websites, I am interested in the world of SEO. In order to run a profitable online business, you can’t ignore this tool. Unfortunately, I am so far behind the experts that it would take me a lot of time to get up to speed on the topic. Instead, I have decided to outsource some of my work for SEO on one of my niche sites. Outsourcing is a great way to hire expertise in an area that you may not be knowledgeable in. Instead of investing your precious time on learning a particular topic, you can hire someone else who is experienced in the field.

What are your reasons to outsource that you can provide from past experience?

Related posts:

1. 3 Reasons not to Outsource Your Passive Income
2. Why I May NEVER Outsource Again
3. 10 Simple Reasons Why I am Building Passive Income

Related posts brought to you by Yet Another Related Posts Plugin.