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Get further ahead and make more money with passive income

Get further ahead and make more money with passive income

NOVEMBER 23, 2017     AUTHOR: SHAUN

Passive income is key to building financial independence. Learn how to get further ahead faster with passive income below.


“Earn $10,000 a month from home… working only 4 hours a day!” Sounds pretty good, right?

If you’re like me, chances are you’ve seen an ad online and dismissed it as ridiculous. If it was that easy, wouldn’t everyone do it???

Now I’m not here to tell you that you should sign up for each of those ads (call me strange, but I still don’t have a ton of confidence in them). But I am here to say that the idea of making money in a hands-off kind of way is possible.

In fact, the idea is getting a lot of attention these days as people look to new and different ways of making money. The concept is described as passive income.

What is Passive Income?

Is it free money, requiring little to no work?

Not exactly. While that would be nice, it’s a little bit harder than that.

The best way to describe it is collecting money that requires minimal effort to maintain. Let me elaborate a bit further.

Many people think that earning money only happens one way: the more you work, the more money you make. Plain and simple.

A lot of people go their entire life approaching both money and work this way. It means that the only way to get ahead financially is by putting in extra hours. This additional work is often at the cost of time with family, friends or leisure.  You can’t have it both ways.

Now I’m not a lazy person by any stretch of the imagination.  I believe a good work ethic is necessary for anything you do (work or personal). But I also have a good head on my shoulders. I know that if there were a way to get ahead, without requiring more hours at the office, I’d be in!  That’s where passive income comes in.

Passive income can make you money when you’re not actively working.

Is it still hard work? You bet! They often take a lot of research, planning, and investment up front. But the beauty of them comes once they’re set up. If structured properly, passive income only requires a little bit of maintenance / tweaking. Think of it as if it’s a machine – there’s upfront work required to build it, but once it starts running, you only need to worry about a little upkeep here and there.

What are some examples of passive income?  And how can you get started?

To be honest, one post isn’t enough to do passive income justice.  I want to make sure I go deep and give you a bunch of examples of how to create passive income.  To do this, I’ll be sure to dedicate an entire post as a complete outline of passive income streams next week. In it, I’ll highlight not only the type of passive income streams, but also what you need to get started.

In the meantime, though, below are a couple of ideas to get you thinking.

Once you get started and experience the benefits of passive income first hand, you’ll likely find yourself in more than one of these:

  • Monetary investments: Real Estate, Dividend Stocks, Peer-to-Peer (P2P) Lending
  • Businesses: E-Commerce Sites, Limited Partnership
  • Digital products: Podcasting, Blogging / Writing, Creating a Course, Building an App

Related post: The best passive income ideas you need to start now

Why’s passive income so important?

Take a look at some of the wealthiest people in America… what do a lot of them have in common?

For one, they don’t have “jobs.”  They set up businesses or different streams of income to build their wealth. They’re not “all-in” on any one thing and they have many irons in the fire making them money.

Most importantly, while they’re heavily invested in the outcomes of those income streams, they don’t spend 24/7 monitoring them.  These people spend a lot of time and effort starting/building these income streams, but afterwards, they sit back and watch their money grow and optimize with little effort.

We can all learn something from the wealthy people.

In fact, there are many benefits from setting up passive income.  Below are just a couple of them:

  • More time for you – Passive income enables you to have a “set it and forget it” mindset. You don’t have to be plugged into your work all the time. Instead, you build income streams, track them, and optimize them. This means less time “working” and more time back in your calendar.
  • Less “earnings risk” – When you only have one source of income, you place all of your eggs in one basket. If you lose it, you’ll find yourself in a jam. With passive income, you can (and it’s recommended!) set up many streams of income. That way if one goes belly-up, you still can pay your bills.
  • Financial independence – Passive income removes the “cap” on your income. How much you earn is only limited to how many successful streams you set up. To some degree, you are your only limitation! Passive income can help you unlock financial freedom.
  • Variety in your work – Not a lot of people think of it this way, but passive income is great to keep you engaged in a variety of work. If you set up several streams of revenue, you’ll have no shortage of ways to keep you busy in many different of ways. For those of you who have a short attention span, or like to experiment with different ideas, this is a big plus!

Related posts:

Passive income is not limited to the elite

Passive income is also great because just about anyone can do it! It is not restricted to the elite or even the most educated.

Sure you might not be able to do everything, and certain income streams might need a bit of know-how in a particular field but that’s okay! Combining your own skills, with a bit of training and hard work can unlock a lot of potential income streams.

Are you good at math and teaching? Why not set up an online tutoring course and build a community for those seeking extra help in school.

Are you good at graphic design? Why not start a YouTube Channel, showing hands-on practical advice on how to turn plain portraits into stunning designs.

The opportunities are endless. Don’t be afraid to push the boundaries of thinking! 

Just because it’s “passive” doesn’t mean it’s “easy”

“Things may come to those who wait, but only the things left by those who hustle.”  Abraham Lincoln

I don’t believe Abe could have put it any better.  The best things in life don’t come easy.  And passive income is no different.  To set them up correctly, they need hard work and a lot of it!

Building a good dividend portfolio requires a lot of research. 

Designing and shooting an effective “how-to” course takes countless hours of scripting/shooting and editing, much less marketing. 

And I’ve learned first-hand that building a successful blog isn’t as simple as “two-clicks.” 

The hard work up front does eventually pay off! The beauty of passive income is that once you’re set up, you’re ready to go!  Once they start running, your income streams only need ongoing monitoring and maintenance.

I really like the way Pat Flynn from Smart Passive Income puts it… as an author, teacher and professional speaker on the topic, he describes “passive income” as an act of “working hard now, so you can reap the benefits later.”  And that’s spot on.  (You can also read more about Pat Flynn in his Forbes article here)

You can’t just stumble your way through setting up passive income streams.  Building them can take a lot of hard work and you have to be intentional about what you do.  But the goal here is to establish an ongoing, stable stream of revenue that you control and requires minimal effort to maintain later.

A last word of caution – don’t just do it for the money

Before I close this weeks’ post, I just wanted to emphasize one critical point…. you should not be setting up passive income only for the money.

If money is your only motivator, it’ll only be a matter of time until you become bored and lose motivation.  You won’t give your passive income streams the attention they need from you, and you might be disappointed in how they perform.

I’m a firm believer that no matter what you do, money shouldn’t be the only driving factor.  As I mentioned, there are tons of side benefits tied to passive income, so think big and broad on what’s right for you.  You’ll need other driving factors to help keep you grounded and motivated when times get tough.

SWP Action Steps

Hopefully, this post has made it clear why passive income is so important. 

If this is all you need to dive right in, why not get started now?  Take a look at your own set of skills, and think through what types of income streams are best-suited for you. 

Quite often, the most important thing is to take action.  A lot of people talk about ideas, but never put it into practice.  I know personally, that’s often been the hardest part for me.  I have so many great ideas, but none of them matter if I don’t at least try to take that first step! 

Don’t die of analysis-paralysis. Do your research, and learn by doing!  Don’t be afraid to start off small, and work your way up.

For most of you though, I’d encourage you to read Part 2 of this series (which I’ll post next week), where I outline a complete view of passive income streams.  It’ll give you many more ideas on how to create passive income, as well as describe what resources you’ll need to get started.

If you’re serious about building passive income streams, I’d also encourage you to start saving.  Not every stream of income will take you thousands of dollars to set up, but they won’t be free either!  Even setting up a quality YouTube channel will cost you money in equipment.  Start by putting aside a few dollars here and there, and by the time you have your idea built up, you’ll be ready to go.

Think it through

  • What is the most appealing part of passive income for you?
  • How could you use your own set of skills to build a passive income stream?
  • What would prevent you from starting a passive income stream today? How can you work to overcome it?

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