Yesterday, I was greeted by a text message from a friend saying that he was terminated from work. It came to me as a shock because he has been working in that office for almost 6 years now and I believe that he has done a remarkable job there. He was no ordinary rank and file employee. In fact, he was one of the managers who greatly contributed to the success of the company.

I also find it quite ironic because he received the sad news a day before Labor Day here in the Philippines. A day when the country pays tribute to the men and women who drive this nation’s economy. Well, apparently, due to the cost cutting measures which the Board of Directors decided to implement, my friend and the rest of his department, will now be joining the millions of unemployed Filipinos to celebrate this national holiday.

All this had me thinking.

How financially secure is it really to have a job? Yes, being an employee, you are sure to receive regular salaries. You get to enjoy paid vacations and reap social and medical benefits. Most people prefer living this lifestyle and think that as long as they do good at work and manage to live within their means, then they’ll be assured of a stable financial future.

How many of you feel this way?

Personally, I have given up on that dream of climbing the peak of the corporate ladder so many years ago. I have come to realize that if I really want financial freedom and security, then dedicating myself to a life of employment will not take me there.

No, I’m not saying that you should resign from work because it’s not financially stable. My point is that you should never think that having a job is more secure than being self-employed or being an entrepreneur. In this world of uncertainty, you’ll never know if you’ll still have your job tomorrow or next week. Likewise, you can never be assured that your business will continue to grow and stay strong forever. You can only hope but not expect that your investments will increase in value in the future.

With all the possible scenarios, market fluctuations and other factors that we don’t have control over, how then can we achieve genuine financial security?

I believe that financial security can only come if you have multiple streams of income.

This means that aside from your salary earnings, you should likewise create other cashflow streams such as portfolio and passive income. By doing so, you will not only have financial security, but more importantly, you’re setting yourself into generating good wealth and becoming rich someday.

As for my friend, I know he’ll be alright because he has several streams of income. He’s on a job hunt right now, and until he finds a new one that will maximize his skills and give him the same fulfillment as he received from his previous work. He can rely on his freelance projects and other investments to sustain his financial responsibilities. Can you say the same for yourself?

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Photo courtesy of ameiss