Combining work from several sources can give you income, freedom, and opportunities that exceed the old model of the salaried position
I have a portfolio career. I have developed this career steadily over the course of more than a decade. Over this period my work has developed from side hustles and freelancing into a proper career, one with purpose, direction, and development opportunities. This career allows me the flexibility and variety I crave. I get to work on the things I love, support my family, and enjoy the lifestyle that I want.
Sound too good to be true?
Well, I will share how I have built this career and made it financially sustainable.
What does the term portfolio career mean, and how does it differ from a side hustle?
A portfolio career is either having several jobs at once or a number of jobs for a short time. The former definition is increasingly the most frequently used term, and it is the meaning I will be referring to in this article.
I would also suggest that a portfolio career is not just a side hustle or even multiple side hustles. These things are similar, as there are multiple jobs involved, but a portfolio career is different from a side hustle in the way strategy is different from tactics.
A side hustle is generally a short-term tactic to improve cash flow or to start a new venture. These side hustles can develop into a portfolio career, but they are usually a means to an end rather than the end itself. For example, you might do a part-time job to pay the bills while you are building a writing career or launching a startup. Equally, the writing or startup might be the side hustle that you do alongside your full-time job. The side hustle, therefore, supports a transition or goal.
A portfolio career is less of a goal and more of a long-term career choice. It is a career strategy that builds multiple work opportunities and revenue streams into a coherent whole. This choice allows a particular lifestyle, career progression, and set of opportunities. The jobs themselves may not appear related, but they are designed together, as I will demonstrate later.
A portfolio career is not for everyone. It is not the only or best sort of career; it is just a choice. As with many decisions in life, it comes down to what you value most. The advantages and disadvantages of any career are generally linked to this balance and choice around these values.
People hold a variety of different values. These are almost always good things, but how we choose to prioritise those principles or beliefs defines our specific values. That prioritisation makes our choices differ from other people’s. For example, stability and flexibility are both great, but it is hard to have both in your work. You often need to prioritise one over the other.
In the case of portfolio careers versus a traditional career path, you might be weighing up these or similar values:
They are almost two sides to a coin: If you choose one advantage, then you lose out on the other. The flip side of any choice becomes the disadvantage, the opportunity cost, of that decision. But we shall see later how to build a career to offset these downsides.
Whether a more traditional or portfolio career is best for you really depends on what you value and what you are passionate about. There are no easy answers. A lot of the people I coach are trying to work out exactly these sorts of things, and it takes time and reflection to really make the right decision.
It is important to remember that you can find your vocation, use your passion, and stay true to your purpose in either type of career. For example, I have many friends who are doctors. They are passionate about what they do, but to follow that vocation, they need to specialise rather than multi-task in their career. No one would question that what they do does not have an incredible value, particularly in the present pandemic. The same could be said for a lot of other professions and vocations.
If you decide a portfolio career is right for you, then to build one you need to maximise the things that align with your values and design the career to offset some of the potential risks and downsides of this sort of career. Therefore you need to think about the role that each job or income plays in the overall career and financial picture.
To demonstrate this point I will use a farm analogy. One good thing about this analogy is that it shows that a portfolio career is nothing new. In fact, you could argue, developing a working life with multiple income streams has been around longer than the “work and then retire” model. The farm, smallholding, or cottage industry are all long-existing examples.
To keep things as simple as possible, we are going to limit our model to four elements. That does not necessarily mean we have exactly four jobs or income streams, but we need to fulfill the purpose of each one.
For our portfolio career we will need:
- The Farmhouse
- The Cow
- The Chicken
- The Cash Crop
Using this metaphor, let us look at what should go in a portfolio career to support these elements. Each part of the portfolio has a career and financial purpose, as can be seen in the following table:
We design the whole career working on how to maximise the things we value (for example, opportunity and flexibility) while managing and offsetting the potential downsides (like lack of stability and security).
In this way, it is like a financial portfolio or a house build, if you prefer these alternative analogies:
Let’s look at how we develop and manage each of these facets in turn.
The Farmhouse gives stability. The same goes for a traditional career, but in a portfolio career, you need to be much more mindful of what your career fallback is and how you underpin your long-term finances.
For me, this stability comes through property. I am not saying this is the right choice for everyone, just an example of how I have built this financial foundation. My attraction for property is partly due to being an engineer by education and partly because I worked in the construction and housing industry. Therefore, I have always seen property not just as a home but as an investment opportunity.
I know that many people now are struggling to get onto the property ladder, and this may seem an unachievable dream, but by way of encouragement, I started off small and you might be able to do the same too.
My progression into property developed along these lines:
- Pay off student debt
- Save for a deposit
- Buy the first property (that needed renovation) with my partner
- Renovate property and create a second bedroom
- Get a lodger
- Start to rent out property whilst on holiday
- Use a job opportunity to move out, rent out our first property
- Save to buy a second property as we were renting
Let me point out the timeframe. It took me years to save up for a deposit and another ten years to go from one property to two. But we bought the first property knowing we needed income as soon as possible. The lesson? Start small but plan long with this sort of asset.
Using the gig economy and developing passive income
When starting small you can join the gig economy. This allows you to start getting an income but also comes with some downsides. In our case, we had to compromise on our privacy when we got a lodger. We had to do a lot of work to advertise and prepare our flat to rent it out in the holiday season. The point is we started to leverage what we had.
What can you do? Maybe you can do something similar or rent out some storage space, workspace, a car parking space? If you don’t have a property, what other asset could you leverage? You can rent out cars, household appliances, and pretty much anything you can imagine in today’s gig economy.
Developing a passive income
In the world of Timothy Ferris, this Farmhouse would be considered a passive income. It is a mature asset that brings a steady income or could be sold to raise capital. But anyone who has tried to get a passive income knows, developing a passive income is anything but passive! It generally requires time, money, and lots of hard work. If you want a business that gives you a passive income, you first must build that business. If you want investments, online products, writing, or property to be that financial base, you have to build them first.
So as mentioned before, start small but plan long. And start as soon as possible if you don’t have something already.
The good news is that once this part of the portfolio is built, it is relatively low maintenance. The idea here is to consolidate the income stream and hold the asset for the long term.
The Farmhouse gives stability but may not bring much, or enough, in terms of cash flow. This is where the Cow comes in. The Cow brings a steady, reliable income.
For me, in work terms, this has been my career as a reservist in the military. This is a part-time job, one that provides a steady income, but it also gives me meaningful career progression and opportunities for personal development. I have been in the reserves for more than 15 years, and it is not something I could have done for that long if it were not something I enjoyed. It is not just a job to pay the bills (although it does help to do this), it is a career itself. As a leadership coach, being an Army officer also keeps me honest and forces me to practice what I preach!
For you, it may be another sort of part-time role somewhere. It might be that you change your present full-time role to become a part-time one. This will take some negotiation with your employer, but I know plenty of people who have achieved just that.
The financial role of the Cow in the portfolio can be another investment or asset that provides a steady income. It is like having bonds or other investments that give you a steady return. Nothing dazzling, just reliable. If you are fortunate like me and can also make that something you value and enjoy, so much the better.
So now the baseline cash flow is assured. What next? Well, this is where the Chicken comes in. The Chicken gives top-up cash. It has some worth as an asset, but its real worth comes through its productivity. What it produces is also not enough to cover cash flow needs on its own, but it boosts overall income considerably.
In financial terms, the Chicken means that once we have paid the bills (hopefully these are covered by the Farmhouse and Cow), this is the extra we need for discretionary spending and luxuries.
This might court controversy, but foreign holidays, designer clothes, and eating at restaurants are all in this financial category. I am not saying you should not want or have these things (most of us do), but just remember where they are on the priority scale. In Maslow’s hierarchy of needs, these are similar to the basic physiological needs of food and clothing, but expensive coffee is more about self-actualisation than survival (although it doesn’t always feel that way in the morning!)
I say this as at times when building my portfolio career, I have had to do without some of these nice things in order to progress. Buying our first property completely cleaned us out of funds, and for several years we had to watch every penny. But that budgeting allowed us to consolidate our finances and progress in our careers.
So, adding a Chicken to the portfolio increases our income to more comfortable levels. Coaching, facilitating, and consulting is my Chicken. It is a more intermittent cash flow, as it depends upon my business development and the time of year, but this creates an income that goes above my basic needs. The income is intermittent but generally very good when it does come in.
It is also not just a job that I am doing for cash. I love this work — particularly coaching leaders — and I find it deeply satisfying. But it is also very time-consuming, so I must limit this work and, as a result, the income that comes with it. I need to do this to provide time for the final element of the portfolio career.
The Cash Crop
The Cash Crop is the part of the portfolio that is high risk and high reward. It is likely to be the thing you are most passionate about but won’t bring you an immediate income, or at least not enough of one that you can live off.
The Cash Crop gives the opportunity for creativity and experimentation and, if we are lucky, for a financial windfall. But there is also the chance we could fail at the loss of our time, and potentially some income, in the short term.
It might be that sometime in the future, the Cash Crop of today becomes the Chicken, Cow, or even the Farmhouse of your future career, but for today it is a new venture.
For me, my writing, public speaking, and online business come into this category. I love creating and communicating content to a large audience.
As I seek to try out new things and nurture this part of my career, it takes a disproportionate amount of time compared with the income it creates. So why do I keep doing it? Because it is my passion.
Also, the more this part of my portfolio career increases, the more it supports the underlying reasons for seeking a portfolio career in the first place. It gives me variety, challenge, and flexibility that I would not get otherwise.
So, what is it that you would dearly love to do? What do you do in your free time that you would also love to get paid for? These passions can be developed to become Cash Crops. You just need to think creatively.
For example, I love walking. No one is going to pay me to go walking, right? And yet that is what I do. I coach people while I walk, I record my podcast while I walk, I make business calls while I walk. The fact is that you can take just about anything you enjoy, pivot the idea, and make it part of your work life.
The best time to start building a portfolio career is now. That doesn’t mean you have to quit your present job right away, maybe not at all, but you do need to start planning.
What sorts of jobs and opportunities do you think could make up the various aspects of your career and income? Using the analogy here, what would you list under each heading? They could well be blank. Don’t worry, they were for me at the beginning too! It also took some time for the various elements to settle into the structure.
The important bit is working out the next step. This should be something that you can achieve today. To help with the next step, ask yourself: What is the best thing I can do today to take myself closer towards my dream?
Whatever your answer to this question is, it probably requires an allocation of resources. How will you use your time and money? Maybe you need to set up a standing order from your bank to start building up some savings. Or perhaps you need to find a time every day you can commit to your passion. It could be that you need to hunt for that side hustle or part-time job.
Whatever it is, put it in your diary now. (I nearly wrote dairy — the farm analogy has gone deep!) And once you have achieved that step, ask the same again: What is the best thing I do now to help me progress?
A portfolio career has worked for me. If it fits your values, you can make it work too.
I have been blessed to come through the pandemic in good shape, and a lot of this I can put down to my career choices and how I built my portfolio. I am not saying that it has been easy, but I can attest to the financial resilience of a portfolio career.
But as I said at the beginning, my career did not come together overnight. One of the greatest bits of career advice I ever had was from a former manager. They told me:
“Many people overestimate what they can achieve in a year and vastly underestimate what they can do in five or ten years.”
This wisdom helped me to plan and measure success over a different time frame. In the age of rapid fame and instant gratification, this is countercultural, but the advice has served me well.
And I think that is a great place for me to stop and for you to start. What is it you need to do today to develop your career?
Remember: start small, plan long, but begin now.
Good luck on your adventure!