Passive Income 101

Passive Income What Is It?

Passive income is the idea that we NO longer have to trade time for money. We do not have to have an active income at our 9 to 5 in order to bring in money.

Our money works for us while we sleep! We are getting out of debt and automating income while we are living our lives to the fullest.

I know for me it was easy to see the allure to why this way of life and income is so desired. Who doesn’t want to take a vacation, spend the day with your spouse and kids, or help your favorite charity all while still making an income!

A word of caution, while there are passive income opportunities, there is no such thing as a truly passive income as you will have to spend hundreds of hours starting it and then a few hours here and there maintaining that income. We will touch on this later.

How is Passive Income Helpful To You?

So now that you are all fired up about this passive income idea, let’s understand why we even want passive income and what it will do for you!

1. Help supplement your day job.

This is probably one of the most common ways to use any form of a passive income stream. As not everyone hates their day job!

2. Save More Money

This is what I enjoy using mine for! While I believe that you have to learn how to manage your money and learn how to cut expenses. Sometimes you just cannot cut anything else out, heck that’s one of the reasons I started this blog.

This is great even if you have a small $200/month of residual income coming in each month and it goes directly to a savings account! In six months you will be doing better than 50% of Americans who cannot afford a $500 expense because of no savings!

3. It can help take the worry out of a lost job

While no one wants to ever lose a job, it’s even worse if they are not planning on it. But I mean who really “plans” on losing a job. Either way having a form of residual income helps ease that immediate search for a new job!

Imagine with me if you lose your job, you have enough saved and enough residual income coming in that you can take the next month to find a good job. While along the way not having to worry about the financial stress that comes along with losing the previous one.

4. The Best For Last

QUIT YOUR DAY JOB! Ok, while this is probably a long way off for many of you, myself included, this is the ultimate dream!

Your passive income streams have generated enough money that you are out of debt and can stop work, and focus on passions you have, charities you want to help, and overall live a less stressful life!

What Passive Income Is Not

Let’s challenge a few things the internet likes to tell us Passive income is.

1. Passive Income Is Not EASY!

While the internet marketers and the online world wants to make you think the dream of quitting your job for passive income is easy. It is the exact opposite! Creating a passive income is one of the most challenging and hard working tasks I have ever done!

You will have to work countless hours up front for little to no pay. Generally, you will still have a day job and probably a family at home.

It will require late nights and long weekends but if you can put the hours and hard work in up front, you will achieve what few do and make a life of passive income streams you can be happy with!

2. Passive Income Is Not A Get Rich Quick Scheme

It is easy to fall for the get rich quick schemes the internet has created! But I fully believe that there is no such way to “get rich quick”. I have started or owned a few businesses in my life, and none of them have ever NOT taken a lot of work to make them profitable.

3. Making Passive Income Takes A Special Person

The process of getting too automated income takes some thinking and hard work but I do not believe I or any of the other people I know, who have created passive income are special.

We have all worked extremely hard, put in many long hours when our friends were off “living the life”, and stuck with it even when it was hard.

This does not make us special, just dedicated to living a life free of debt and have the ability to choose what we want to do with our finite time on this earth!