Diversification is the key to long term success in working for yourself from home. I believe that. Have I done it? Some, but not to the extent that I would like to.
At the moment, my primary source of income is writing search engine results pages (aka SeRPs) for a human powered search engine. It pays well for online work, but it still just a freelance contract. So what does that mean? It can go away at any time, for any reason. That is something I don't want to be worrying about every month.
Diversification means spreading out my talents among many services. Ultimately, diversification for me means developing multiple streams of passive income, so that I'm not spending every waking moment trading my time for dollars. I know that I have to work, but it would be nice if work wasn't an all-consuming force in my life.
Bottom line is just like the old saying goes: dont' put all your eggs in one basket. If that basket breaks, you lose everything you've worked for. Want a case study? Here's a case-in-point for you ...
Over the past two years, I've really read up on blogging and earning money from blogs via various advertising models such as Google Adsense, Text Link Ads, banner ads, block ads and even Pay Per Post. So what did I discover? All of those things pay, but only a few are what I call "hands off" passive income. Adsense was one of those, of course. On another blog that I have since abandoned, I documented for several months the sources of my online income, the amounts, etc.
One thing I realized was that Adsense was a consistent performer, with no extra work on my part. I would post on some of the blogs, but nothing really overwhelming or a schedule killer. Month after month, Adsense continued to perform and even increase slightly each month, as my blogs and websites experienced more traffic. All was as it should be.
Now don't get me wrong. I wasn't making a ton of money on Adsense. The first year, I got one check from Google for $100. The next six months I qualified for another one. I was on schedule to get another one in a month or two. That's when the basket dropped. I got a nice little email from Google one day saying that my Adsense account was suspended, and that I was welcome to file an appeal, but no further action was required by me, or them. The reason they gave? Well, that wasn't really clear, but it was "possible click fraud". Okay. Wait just a minute.
I'm a white hat kinda guy. I'm trying to put together real content for real people. What happens? I get the Google slap! I know all kinds of guys out there selling black hat SEO stuff, and making a killing off of Adsense. I get the best month ever of traffic to my various blogs and websites, and boom! Google shuts down my most consistent source of passive income. Of course, I filed an appeal, but never heard back from them. I re-read their TOS for the program, and realized they reserve the right to cancel anyone for any reason whatsoever, without explanation. Wow. Nice.
Moral of the story: Get many baskets to put your eggs in!