what is passive income
Passive income is money you get that you don't actively have to work for. It's like a 'money tree' you already have, and you can keep harvesting it on a regular basis.
It is income that keeps flowing in over time without you making any effort to maintain it. It all sounds so easy, but is it so easy?
Let's dive something deeper into this.
What is passive income?
As the word says, it is the opposite of 'active income', which is an income you must actively work for.
Generating money without anything in return is one of the pillars of achieving financial independence. So you can enjoy life and know you will have income streams without having to work actively for them.
Work might be the wrong word, but 'active income' is more like an exchange of your time for money, or your physical work, or your brain, ... You always have to sacrifice something from yourself to get some money in return.
The more 'passive income' you generate, the less time you have to spend on 'active income', so the more time you will have for the things you enjoy in life.
That sounds perfect, right? Nothing is more wrong than this because generating passive income doesn't come overnight. Except when you get an exceptionally large heritage from an auntie you didn't know existed.
As the slogan of my favorite football says:
'No sweat, no glory
'
Why I want passive income?
This is a bit obvious, isn't it?
Everyone wants to have more spare time or wants to be able to buy stuff.
Money coming in without you having to do anything, isn't it amazing?
Money you get while you are sleeping, money you receive while playing your favorite sport, ...
Passive income not only allows you to buy that new phone or have a better lifestyle finally, but it also gives you a life without stress because you know money is being made without you having to do anything
Another big advantage is that it generates generational wealth if you keep on reinvesting your received passive income into other passive income streams.
You will not only see your capital increasing, the next generations will have a big head start by getting these passive income streams. You will also have given them the right mindset.
What do I need?
Nowadays, everything can be monetized. You have the biggest stage for your products in history, the whole world can see what you have to offer.
You only need a little to set up an online passive income stream. The only requirement is an internet connection (and a phone or laptop), and you're ready to go.
Then comes the most important non-physical requirements: patience, resilience, quality, and strategy.
Rome wasn't built in one day.
There will always be obstacles and challenges in your online business, such as technical issues, changing market trends, financial troubles, and lots of competition.
The ability to pick yourself up after such a setback is essential for being successful
The internet made it possible to have the whole world as your audience or client.
Whether you have a blog or a YouTube channel or you sell digital products, you have to stand out from the crowd. That is only possible by delivering unique and high-quality content or products.
You want to have as many clients as possible or a million visitors a month, right?
To be successful, you need a strategy to attract these people. But attracting them is not enough; you also want to keep them returning to your blog or shop.
Therefore, you need a proper strategy and keep on tweaking that strategy according to market trends or customer feedback.
Don't believe the hype
Don't believe them, it is not true. The only people getting rich are these gurus and influencers because you listen to them, watch, or buy their courses.
If everything were this easy, everyone would try it and be a millionaire.
Building a passive income stream takes time, lots of time. And consistency and perseverance. Many try, and 90% fail because they don't see the results in a short period and give up. Read more about the frustration of setting up a passive income stream on The ugly truth about passive income
Building passive income streams isn't a get-rich-quick-thing, it takes lots of planning and patience.
Believe the hype
Passive income exists, and millions have already proven it.
Many people nowadays are looking for an extra source of income. You can do side hustles to get that extra money, but it is better to fully focus on creating passive income streams (more about that in Focus on passive income, not side hustles).
Why do you think there are so many YouTube channels and blogs (ok, mine included) dedicated to passive income? Because people want to create an extra income stream and because it is possible.
I believe in it and know I will succeed in building several passive income streams.And you know why? Because I want it and am willing to dedicate lots of time and effort to it. Because I know the results will come over time, and I will harvest the fruits of my hard labor.
Plan and ... plan your future
You need to make sure what you want to invest (how much time or money) and according to that, start planning.
Planning doesn't only mean having a roadmap for the next few weeks. You also need to have a backup plan (or even a backup backup plan) in case your original plan fails.
What are my targets in a few months, a year, or five years?
Once you start generating passive income, it is time to consolidate this and ensure it is sustainable. Once you reach this, you can start reinvesting this money into other projects.
You can, for example, start investing in dividends, you can start hiring people to do the work for you while you manage them, you can invest in a property for renting out, ....
Start small, learn and grow, invest in yourself and your business, ... and become big.
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