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Passive income

LucasMartin

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Hello,

In my opinion, you can decide what kind of income are you looking for. Is it a salary or passive income. Let's talk about passive income. According to you what first steps you should take to build this kind of income?
 

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Musashi

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There are two ways to create passive income:

1. Spend money to buy it
2. Spend time to create it

Examples of #1 include things like rental real estate, making loans and generating interest, etc.

Examples of #2 include things like building a passive business, writing a book, creating a course, etc.

Even in threads like this, you still find gold in this forum. Amazing and thanks for posting!
 

RazorCut

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According to you what first steps you should take to build this kind of income?

If we look at passive income as:

'expending time and money now in the anticipation of it returning continued rewards later for little to no effort'

then there are very few truly passive incomes outside of investments. Most passive incomes require a certain amount of time and maintenance so I guess they scale on their level of passivity.

So I think the first steps are deciding how passive is passive? Would you be happy to work an hour a day? An hour a week? A day a week or a day a month for example.

The next step is deciding how much time and effort you are will to put in to build that passive income.

Years ago I owned a Pizzeria and a DVD rental library (remember those round shiny discs?). Combined they required maybe 2 hours of my time a week (admin and wages). Or, if I wanted to be more hands on, 6 hours if I went in on a Saturday night and baked some pizza and cashed up the till. However to get to that stage I grafted up to 80 hours a week for months, then 60 hours, then 40 hours. Then slowly down to maybe 20 hours. I invested a lot of time and money to get down to those 2 hours a week.

Once you know those 2 pieces of information I think it is important to decide on if you want a geographically located income stream or a non-geographic one. In other words a business that has a fixed location and is tied to a building or catchment area (retail or wholesale establishment, offices or customer base) or a 'cloud' based approach that has no geographic ties (think author, stock/currency trader, app developer, Amazon FBA seller). A lot depends on how routed you are with family, friends and community.

I think only once you have answered those questions can you start to figure out what business models will fit your ideals and go from there. Doing it in any other order means you will probably end up with something that fails to fulfil your passive income dreams.
 

Monkeycom

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There are two ways to create passive income:

1. Spend money to buy it
2. Spend time to create it

Examples of #1 include things like rental real estate, making loans and generating interest, etc.

Examples of #2 include things like building a passive business, writing a book, creating a course, etc.

Very well summarised. Thank you!
 

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