With so many opportunities right in front of us that allow people to generate a massive amount of income from their home, at their leisure, and simply outside of their normal mainstream income it’s hard to believe that this is still even a thought to anyone - of course you should have passive income.
For anyone that is new to passive income or not quite sure what is passive income let’s define it.
Investopia defines Passive income as earnings derived from a rental property, limited partnership or other enterprise in which a person is not actively involved. As with non-passive income, passive income is usually taxable. However, it is often treated differently by the Internal Revenue Service (IRS).
The key phrase to this and to focus on is “not actively involved”. Meaning you can make money that does not involve you exchanging your time for money. Like how most people today make a living.
Most people speak on chasing your dreams and living a life that’s fulfilled. And that’s not what this post is about. Some people enjoy their job they have value at their company, or add value to their clients , and so they feel fulfilled with what they do. What this post is more so dealing with is the importance of creating passive income for yourself. What are the benefits of having passive income? How to identify opportunities for passive income? These are some of the questions that we’ll cover in this post.
Now that we have defined what passive income is let’s clarify the phrase that you will “not have to be involved” in generating this income. The goal in this phrase is to not exchange your time for money. I’m sure you’ve heard of the term “make money in your sleep”...
When you are doing that you are generating passive income. When you can do that consistently through systems, that passive income can come residually every single month. The residual income is the money that you have left over after you pay your bills each month. As defined by investopia.com again.
For most people that are working for some one else, which are the vast majority of people, having income outside of your current position is vital to financial freedom or even protection. At a job no matter how good you maybe at your position you don’t have full control over your finances. That should be a concerning feeling for a lot of people. It’s called diversification, even if you are amazing at your job and extremely unlikely to be let go, you maybe in control of your position, you still have no control over the company. So if your company goes into another direction with your division or position, that could affect the amount of money you have been accustomed to generating. If the business finds new competition and the market changes, as an employee you want to feel protected, the only way to do is by diversifying your monthly revenue. Drawing income or resources from multiple areas. There have been multiple company’s “too big to fail...” #greatmoviebtw
This is just a thought, if there are multiple ways to make money, and if you were taking $100,000 of your own money to invest, would you put it all on one option; or spread it around?
The same thought process works with your time, energy, and resources. If you’re spending 8 hours or more of your time working your job to generate income, there are 24 hours in a day which is 1/3 of your time used to create money for 100% of your life. That’s just not a recipe for success, the numbers don’t add up, and often (given my financial background) I find people relying on government or 2 household incomes to satisfy all of their expenses that come up at different points in their life; and even then it still doesn’t fit everything that they need.
If you don’t mind working, enjoy what you do, and make a good living ask yourself this question...if someone said they would give you $100 a month every single month would you accept it?
Unless you are using $100 bills to wipe your butt after a shit, you would absolutely accept that, and not only that if that money didn’t come to you one month for whatever reason you’ll wonder what the hell was going on.
If you don’t have any opportunities in your life right now that are generating passive income then that’s how you should begin looking at it. Conscientiously it’s easier for people’s mind to process being provided a extra $50 - $100 a month - then to believe that they can create a massive amount of wealth by something that’s not attached to their time.
Let’s talk through some of the most common ways people nowadays generate passive income.
Real Estate (Marketing business, can require a lot of money or time)
Intellectual property (Patents, ideas, Licensing, etc)
Entertainment (Music, Movies, Books)
Network Marketing (people business, can require time vested)
Investing Portfolio (Dividends, Returns, Bonuses)
Internet Marketing/E-Commerce (Social Media, Ebay/Amazon flips, etc)
These are the areas that come to my mind, let me know if I’ve missed any industry. But anyone of these can be turned into a million dollar machine, or they can also just take care of a minor bill within the household, what you put into is what you will get. But the idea is to make sure you have your foot in the door, because if all you do is rely on transactional income, exchanging your time for money then you are walking a proverbial line in which any major life event can put you in a place where you are drowning and can’t keep up.
Given your own personal income, resources, support team, knowledge, time, and passions find something to work on now and begin to grow it.
Because with consistency in those areas, it will allow you to “not be involved” and wake up to more money in your bank account at some point.
I will later break down each area personally, and/or interview people with more knowledge than myself in certain areas.
Hope this post meant something to you...
Lets Go earn our freedom!!!!
#Upintheclouds #abovetheBs #liveyourlifeonyourterms #Braveheart #Django