Any examples of trading can get income. Best Passive Income Idea
The types of passive income are those in which the availability of stable financial income does not depend on daily work activities. Any of us have heard of people living off such income - those who do not have to go to work. They are called "rentiers", that is, living off the rent.
Rent is the income that the owner receives from the fixed capital placed in real estate, deposits, valuable papers ah, etc. "From the same opera" - sources of passive income related to copyright. By the way, the last option is not ordered to anyone these days. Everything is simple here: having created something once and fixing the copyright for your own brainchild, you will have such deductions with every next sale.
If you are a professional (no matter what area), you have a real opportunity to monetize your own knowledge. Simply record your training course in video or audio and market it.
Why are we not a rentier
Today we will consider options for passive income and its possible sources. Its huge advantage is in freeing up personal time that can be spent on favorite activities, family, rest, household chores or somewhere else. Those who work all day long at work are almost completely deprived of such a wonderful opportunity.
To dispose of personal time at your own discretion does not mean to waste your life in entertainment establishments, or lying on a warm beach - many people would gladly do charity work, helping the sick and homeless, or creating works of art. To start making all these dreams come true, you need the most stable one. passive income.
Everyone has heard the expression "money for money". What does it mean? Nowadays, a situation is not uncommon when, having a generally good salary, a person "eats" it completely, buys things on credit and is interrupted by loans from relatives and friends from paycheck to paycheck. This continues for years and decades.
But why is this happening? I think the main problem such people is that the idea of passive income does not even occur to them. They are not able to engage in the creation of an asset that will further work for their well-being. All that they earn, these people immediately spend, and thus deprive themselves of the only chance to ever escape from the captivity of financial slavery.
Do you recognize yourself?
Some of these consumers can be classified as "financial zombies". These are those whose assets have long been negative. That is, their expenses are greater than their income. Debt accompanies them throughout their lives. Having given one loan, they immediately take the next one, and so on.
The other category is a little more prosperous (but this does not make it easier) - it tries to somehow correlate its expenses with the amount of earnings. They sometimes have a set of necessary goods - housing, a car, etc. Most of all this was purchased on credit, which puts the owners in a dangerous and unstable position. After all, if any unforeseen financial circumstance happened, their well-being would crumble like a house of cards.
Progress is evident ...
In contrast to the above categories, there are those whose assets can be considered positive. That is, their income is higher than expenses. Most of ordinary citizens from this group prefer not to have debts or reduce them to a minimum and even have some savings, but such saved finances do not play a fundamental role, since they accumulate extremely slowly and are located either under the mattress, or (at best) on the passbook.
The most advanced of fellow citizens are those who are not left alone by the idea of passive income. They are trying to seize every opportunity to invest free funds and create their own additional financial source.
Turning to the authorities
Many people know such a name as Robert Kiyosaki. This investor and businessman has written a number of popular books on the basics. financial literacy, which will not be superfluous to read for anyone. For example, one of the most interesting and effective advice of this author is as follows: the mistake of almost every one of us is that, having earned a certain amount, we are trying to distribute these funds to anyone, but not ourselves. We pay rent and utilities, but at the same time we do not leave ourselves anything. You should start just with yourself by creating your own monetary asset... Subsequently, it will become the basis for investing in a business or other source of constant income.
Another "pro" in financial matters by the name of Rockefeller once uttered a phrase that a person who works full time has absolutely no time to earn money. For all the paradoxicality of this saying, his wisdom lies on the surface - indeed, working in an office or in production, each of us is able to earn for himself personally only on current expenses to maintain everyday existence. For actions leading to wealth and prosperity, there is neither strength nor free time.
The conclusion is this: the main resource is time, which is well known to any of the wealthy people. The idea of passive income is based on the correct distribution of this invaluable asset. And only after achieving this, you can begin to move towards financial success... Everyone knows that all those who achieved wealth initially had a specific list of goals. Well, the third, most important component for creating passive income is active, purposeful work for a number of months or even years.
The result should be a legal opportunity to quit your unloved job and start living on dividends.
Passive income: examples and options
Now let's talk about the ways in which passive income is created. All its sources can be attributed to four types - investment (or financial), intellectual, marketing or legal (that is, the one that is required by law). Passive income in Russia is no different from that in any other country in the world.
We will receive passive income of a financial or investment nature if we invest in a certain financial instrument, which will bring us some percentage of profit. Sources of such investment may exist in the form of real estate, securities, bank deposits, our own business (if acquired), or equipment that we own that can be rented out.
The second of the listed options, called intellectual, arises, as mentioned above, through the creation and implementation of any product of mental labor. The information business, which is widespread on the Internet today, is based on this principle. Many professionals in a variety of fields design and design their own training courses, then release them for sale an unlimited number of times.
"Affiliate programs" is an interesting topic
In the same way, it is possible to purchase the rights to resell a similar product, which can bring no less income. This type of income is called affiliate marketing. Other sources related to this paragraph may be royalties, patents for perfect inventions or developed technologies.
Earnings on affiliate programs- an excellent way out for those who are not too hopeful of creating their own intellectual product - after all, this saves time and mental resources. It is enough just to join such a program or acquire the right of reselling (resale) for the selected book, video or audio course.
Other earnings without investment
Marketing passive income is one in which you organize your own marketing system or several of them. An example of such a structure would be your own website on the Internet or a personal brand, the right to use which you can also sell. A combination of several of these strategies is also possible.
What is meant by a personal brand? This is the commercial use of a famous name. An example is shooting in commercials for movie, television and sports stars. By becoming the "face" of a particular brand, they get good money.
The fourth type - legal income of a passive nature - includes all cases when people, in addition to a certain (sometimes not too high) remuneration for their work, have certain bonuses from the state. This can be, for example, early retirement with guaranteed receipt, which is typical for the military, etc.
We go online
Creation of a website for making money on the Internet (or a blog). These days, this does not require a lot of complex technical knowledge and skills. You can make an acceptable website with your own hands by mastering the minimum information that can be easily and free of charge found on the Web. There are many step by step instructions and video courses.
Of course, your own blog or website will not bring you monetary returns immediately. To promote it and bring it to an acceptable level will take at least six months, and, most likely, a year or two. All this time you have to work on your own project on a regular basis, optimize it and refine it. this work will take several hours daily. However, you can count on the first small receipts within a few months from the start.
Having created and promoted a site, you can sell it, and for a very good amount. It is quite possible for a person who has mastered this technology to organize his own business for the "production" and further sale of profitable Internet pages.
How do you make money on them? The most popular methods include generating income by placing contextual advertising blocks and the same articles on the resource pages, of course, not for free. Sites place affiliate links and sell advertising space, and they also actively offer buyers training courses, both their own and those of partners.
In short, there are a lot of ways to use such a valuable resource as a blog or a website on the Internet, and there is always a possibility to choose something that suits you.
For those who are not deprived of intelligence
The creation of a product that has an intellectual status (such as books, educational videos, new technologies, etc.) implies the presence of a certain talent, as well as a high level of professionalism in any of the areas.
If you are an inventor or developer of an industrial design that has become fundamentally new, then your labor products can be safely attributed to intangible assets. This term denotes those derivatives of our intellect that generate income in the absence of material form. Examples include trademarks, brands, or patented inventions.
Let's get down to earth
Income from renting an apartment (or other real estate - if any) is a well-known and very common option. But there are others like him: it is possible to "lease" not only buildings or retail space, but also equipment related to a variety of industries - trade, construction or manufacturing.
And other expensive items (for example, vehicles) will bring you good dividends. Sometimes it is more profitable to manage equipment than real estate. In particular, having bought tools and equipment for construction, you really organize a good and rather profitable business based on their rental. The payback of such activities is very high and in terms of time significantly exceeds a similar indicator for rented real estate.
Do you want to become a shareholder?
Investments in securities (or other financial instruments, which include a huge number of banks, PAMM accounts, mutual funds) is a widely accepted practice today. This activity is considered one of the types of business.
Replenishing the number of professional investors is not an easy task. This activity is quite complex and requires a competent approach, as well as a fairly serious training. Possession of financial instruments is impossible without a more or less acceptable education in this area, the ability to compare different flows of information, take into account risks and predict the situation.
Investments in securities have certain advantages over, for example, bank deposits, in the form of a higher level of profitability, but at the same time, a high risk of loss of invested funds sometimes negates all the advantages. Having decided to plunge into the world of stocks, mutual funds and PAMM accounts, remember that, with the exception of long-term loan bonds, it is not so easy to achieve stable income here, and the risk of incurring significant losses is always quite high.
You can sell everything!
Participation in network marketing is considered to be a relatively simple and, perhaps, generally available option for creating a source of passive income. The amount of initial investment, if any, is not very large and rarely exceeds a hundred dollars.
A prerequisite for those who are trying to succeed in this field is sociability, readiness to contact a large number of people. In the future, these people - your team - are able to bring money without your participation by organizing their own network, a percentage of the income from which you will receive.
Do you need a lot of money?
The classic and best, perhaps, way was and remains to create your own business. If this action takes place in virtual reality, that is, on the Internet, global financial investments the initial stage is usually not required. That is, this option is available to people with very limited material resources.
It is quite real even to earn money without investments or to accumulate a small initial capital you can earn right here, on the Internet.
There are a huge variety of options for starting and promoting your own business, both online and in real life itself. In "life", of course, this requires a lot of costs and overcoming many difficulties of an organizational and legal nature. Moreover, the competition here is very, very high. But nevertheless, looking around carefully, you can look for your own niche, not yet occupied by rivals.
What's in real life?
For example, a very promising business with passive income nowadays is the purchase and placement of machines for various purposes in large hypermarkets and other crowded places - from payment terminals to machines for the sale of coffee and pies. This business is called vending. A person purchases at his own expense and installs machines, which then bring him a constant and stable income.
In a short article, we do not have the opportunity to consider all types of passive income - there are very, very many of them. Variants of it are offered to you and me by the mass media today, and the Internet has always been and remains their irreplaceable source. We want to conclude our material with important tips.
A few parting words
- At all costs, try to regularly carve out the time left from your main job, which you will spend on building your future asset. Constantly reflect on how you can best use it. Your goal is that earning from your main job does not remain the only source of money for you. You must find sources of passive income that allow you to make a profit more than once or twice.
- Do not limit yourself to creating a single such source. There can and should be several options for passive earnings, and the more, the better. After all, there is always a risk of losing one or most of them. In this case, losses will be compensated through parallel channels. You can see the importance of this postulate by reading about multiple sources of income from Robert Allen.
- Don't forget to educate yourself. Knowledge is an asset that will not hinder anyone. Understanding the world of finance, understanding how money is made, where it comes from and where it goes, is no less important than coming up with an interesting idea for investment or being in the right place on time.
The principles of creating passive income do not carry any special secrets. If you are determined to be successful, have the necessary minimum of knowledge and a certain amount of free time, the result is likely to please you sooner or later.
Passive income is such income that does not depend on the regular activities of a person. The simplest example would be a bank deposit: it consistently brings interest to its owner. Regardless of the age of the depositor, the presence of illness or the desire to go to work, interest will be charged to him.
Active income depends entirely on the actions of the person. To receive it, you need to engage in any activity: produce goods, sell them, provide services, extract minerals and much more.
Revealing the concept of stable passive income, one should not forget about the risks. On the example of a deposit, the following risks for depositors can be distinguished:
- depreciation of currency;
- bank bankruptcy;
- force majeure circumstances.
There are also a number of inconveniences: interest is calculated after a certain period of time (for example, once a month), and you cannot use the invested money until the end of the term of the deposit.
Therefore, before creating a passive source of income, it is necessary to take into account all possible risks of the activity.
Proven ways to create passive income
Before you create passive income from scratch, it is recommended that you familiarize yourself with the existing methods of such passive income. This will help you see all the advantages and disadvantages of the main passive income options. The article will review effective and proven sources of passive income. They can be used as a foundation for building your business.
It should be borne in mind that, having a certain amount of funds, it is somewhat easier to build a source of stable passive income. Without money to realize your dreams, you will have to spend your own time and energy.
Business registration and delegation of authority
This is the most effective method receive passive income. He has a minimum of shortcomings with a competent organization of the case. To create it, you need the following:
- organization of the enterprise;
- business development;
- reaching a stable income level;
- selection of a candidate for the position of manager;
- making a profit with minimal spending of time on control of key documents and making important decisions.
Of course, there are risks here as well. Among them, the main one stands out: the responsibility and decency of the manager. The further success of the company or organization will depend on his daily decisions. To select a suitable candidate, most often they resort to proven personnel who have worked at the enterprise for a long time.
It is not easy to create and grow a business. This takes a lot of time, money and skills. However, there are many situations when a skillfully chosen niche for doing business allows you to quickly develop it.
What you need to start your own business:
- business plan;
- start-up capital (in most cases);
- official registration;
- rental of premises;
- hiring employees (if required).
Any enterprise carries risks for an entrepreneur. No one can be sure that the activity will generally generate income and not losses. Therefore, you need to weigh everything correctly before creating your own business. If everything is done correctly, the entrepreneur will have success and the possibility of earning passive income.
Selling your intellectual property
This type of activity is suitable for those who have knowledge and skills in certain sciences or specialties. How to create passive income from scratch while being able to create in-demand information products? They need to be implemented.
What can be attributed to intellectual property:
- artistic, literary and scientific works;
- created unique industrial designs;
- developed software;
- invented objects or technologies in all branches of life.
As you can see from the list, intellectual property can be in any area of human activity. Passive profit can be brought both by a written book and by a unique invention that helps to increase the productivity of equipment, for example. For a property to be individual, it must be documented. For this, patents are granted and copyrights are assigned. By owning them, you can profit from the sale of your goods / services.
The simplest example for considering the option of making a profit is a written book. The author of the book will sell copies of the books himself or by entering into an agreement with a publishing company. The owner of the rights will make a profit on every book sold. If it is in demand, it makes a profit. If it is in demand for a long time, it makes a profit for a long time.
This does not only apply to books. Increasingly, they are resorting to creating various programs on PCs or mobile devices. One completed project can bring passive profit until another, cheaper or more useful one, appears on the market.
Accordingly, to create such a source of income, a person needs:
- come up with / create something unique and in demand for society;
- confirm your rights to the invention;
- to realize the product of their activity.
Disadvantages: a lot of work is needed to create unique pieces / techniques / technologies; property may be unclaimed and will not bring tangible profits.
Building your own trading network
Such a network is able to provide its owner with constant passive income. All actions will be performed by members of the network, and its creator will receive an ever-increasing profit. To do this, you need the following:
- create your own unique products (less often services are provided);
- formalize a manufacturing and sales enterprise or cooperate with a manufacturer;
- to interest those wishing to become members of the network;
- sell them to other network members;
- form the price of the product in such a way that part of the profit goes to the owner of the network, and part to the seller of the product.
Anyone who wants to make money in such a network must sell these goods. The more he sells, the more he earns. The main key to success is high-quality and sought-after products at competitive prices. This can be anything from beauty products to food, medical supplies, or unique services.
The main difference from most network marketing companies should be the following:
- providing guarantees to all network participants;
- using only safe products;
- availability of contacts for communication with the management and all comprehensive information about the activities of the organization.
These factors will increase sales and employee engagement.
5 (100%) 4 vote [s]
What is passive income and how can an average person create it? How can you live only on a percentage of your investment and never work again. Read about all this below.
1. What is passive income
Passive income is a permanent and stable source of income that does not require any time expenditures (or they are minimal)
The main idea of passive income is to create eternal sources of profit for yourself and then receive money from them on an ongoing basis. That is, we once created something and then do nothing in order to receive funds. For example, the work we are used to is an active source of income, since payment is made only when the employee goes to work. It is required to constantly waste your time.
The simplest example of passive income is renting out an apartment. You get paid monthly rent. In order to receive this money from you, no further action is required.
The sooner you think about creating passive income, the more opportunities you have. You will be able to accumulate more funds faster and more to implement your plans. Most of us dream of creating ourselves financial freedom and not working anymore, but doing what we like.
The benefits of passive income
For example, you can save money for bank deposit every month and for the year to save up a good amount. In 3 years this amount will be even more substantial and perhaps even a percentage of it will be enough for you for some needs.
3.1. The accumulating effect of compound interest
In mathematics, there is such a thing as compound interest. Simply put, this means that over time, your savings begin to grow not linearly, but exponentially. This can be easily achieved by reinvesting the income earned.
My wealth is the result of a combination of several factors of living in the United States, good genes, and the cumulative effect of compound interest. Warren Buffett
For example, if we put 1 million rubles at 10% per annum, then in a year the amount will be 1.1 million rubles. Two years later, the account will be the amount of 1.21 million rubles. In the second year, the capital grew by 110 thousand rubles, and not by 100 thousand rubles, as in the first year. Even in such a short period of time, it is already noticeable that capital begins to work for us even more efficiently.
I agree with those who say that this is insignificant. However, if we take a calculator and calculate what will happen in 10 years, in 20 years, it turns out that the effect is already huge amounts.
How quickly the amount in compound interest growsTo double the original amount of money at a constant interest rate 10% per annum will take not 10 years, but only 7.25 years. It will take 11.5 years to triple.
To calculate how quickly the initial amount will double with a predetermined interest income, you need to divide 72 by this number. For example, if the rate is 8% per annum, then the amount will double every 9 years, and not 12.5 years as it might seem at first glance.
- Develop your financial literacy. To do this, read books about investing, trading, the philosophy of wealth. You can start with Robert Kiyosaki and continue with specialized stock literature.
- Create new assets regularly and reduce liabilities. Look for new opportunities, they are always there.
- Create multiple sources of passive income. It's not worth getting attached to only one.
3.3. Rules: how to get rich from scratch
There is a basic set of rules that anyone who wants to become rich should follow. They are not at all complicated and can be done by any person:
- Pay yourself. As soon as you receive your salary, first of all set aside some of the funds for yourself (at least 10%). Most often, the population, on the contrary, pays off debts and spends money, and what remains is set aside. This is a habit of poor people, exclude it from your life.
- Save what you put aside... This rule implies that the deferred funds cannot be spent.
- Increase your money... It is necessary to invest money in reliable assets in order to constantly increase your capital. We will tell you about the sources of passive income just below.
- Save the multiplied... The earned profit is best reinvested so that savings grow faster. There is no need to invest in dubious and too risky assets.
- Create several types of assets to minimize your risks. Whatever your overall reliable income is, it will be even more reliable if you distribute money among several such sources.
4. Sources of passive income
Many sources of passive income can be created. Everything depends on the individuality of each of us. We all have slightly different knowledge, skills, capabilities, wishes, so you can only decide for you what exactly to do. We will only consider in detail basic options stable sources of money. We will focus on a mathematical basis to calculate how beneficial each source is.
How many sources of passive income you will have is up to you. I can only say that the more there are, the more reliable and wealthy your life is. Therefore, follow the Paretto principle: 20% brings 80% of the result. Make a little effort in different industries to get the most benefit.
4.1. Bank deposit is a reliable source of passive income
A bank deposit is the most popular means of saving and accumulating funds among the population in Russia. The interest rates offered by banks are certainly not as large as we would like, but nevertheless this is really the most reliable way to slightly increase your capital in the absence of any action.
There are a lot of offers on the market of bank deposits. Each bank offers its own line of deposits. If you spend literally 10 minutes, then you can choose the most profitable one for you. Do not be lazy to do this, because there are always profitable offers in banks, where the profitability will be slightly higher (at least by 1-3% per annum).
There is no need to worry that the funds will be wasted. All deposits are insured by the DIA for the amount of 1.4 million rubles (including interest). It makes no sense to put exactly 1.4 million rubles in one bank. Better to put a little less to insure the accrued interest. For example, if we are talking about the rate of 8% per annum for a year, then it would be logical to put the amount of 1.29 million rubles and sleep peacefully (at the end of the term the deposit will be 1.3932 million).
How much can you earnThe profitability of the deposit varies due to the economic situation. The relevance of the information should be checked. As of 2019, you can find deposits with a maximum rate of 8.5%. In more reliable banks at 7% per annum. These are almost the smallest deposit rates for new story Russia. Previously, there were always offers at 10-12%.
- Investment reliability (the amount is insured by the DIA)
- Predictable income
- No action required from the investor
- You can invest any amount
- There is no way to "break" and spend money, tk. it is necessary to terminate the deposit agreement and then the accumulated interest will "burn out"
- Low profitability
- It is impossible to close the deposit ahead of time without losing interest
- It is impossible to store substantial amounts of more than 1.4 million rubles in one bank due to the risks of its closure
I also advise you to partially keep money on debit cards, which give interest on the balance. These cards also give cash back on any purchase. I use these cards myself:
- Tinkoff. 6% per annum on the balance. Amount up to 300 thousand rubles. You can transfer any amount to a special savings account at 5%.
- Benefit (HomeCredit Bank). 7% per annum on the balance. Amount up to 300 thousand rubles.
Summing up, we can say that it makes sense to have some part of the money on deposits, because it is a liquid and reliable asset.
4.2. Renting out real estate
Real estate objects have always been and will be in trend among investors. Such purchases can be visually seen and felt. However, their profitability is extremely low, but first things first.
You can make money on real estate in two ways:
- Rentals
- Resale
For passive income, the first option is considered, since the second method is more risky and requires a constant search for new good offers on the market.
The following types of real estate investments are shared:
- Residential (apartments)
- Commercial (garages, office premises, warehouses)
- New buildings (investments in the construction of new facilities)
Large investors buy commercial real estate more often, since the profitability from the delivery of non-residential premises usually brings more profit, and also does not need any repairs. However, this situation occurs only in favorable periods of the economy, when GDP is growing steadily, inflation is within acceptable limits.
It is difficult for an ordinary person to buy commercial real estate because of its high cost. Objects are different, but usually a good place costs as much as 3-5 one-room apartments... Therefore, many would rather choose the option with the purchase of 3 apartments than one such object.
Since 2014 economic situation in Russia is quite complicated. Real estate prices are not rising. Therefore, many who have invested in commercial real estate are now at a loss. Residential also fell in price, but with slightly less losses for the investor.
What is the profitabilityThe rental yield is at a modest 4-6% per annum. This is even less than bank deposits... At the same time, there are still risks of damage to property by tenants and from time to time you will have to invest in repairs (rarely, but such moments do happen).
Real estate will rise in price over time, but it is hardly worth counting on, since this is an extremely long process. For the growth of its value in the country as a whole, there must be the economic growth... Otherwise, due to cuts in wages and high inflation, no one risks getting into mortgages (most apartments are bought on credit), even with low rates.
- High reliability
- Real estate can be seen with real eyes, which is very important for many people
- Stable rental income
- Great option for risk diversification
- Low profitability
- Low liquidity (when selling, you will have to look for buyers at the average market value, plus another 2-3 weeks to make a deal)
- There are overhead costs for maintaining the property
- Large investments (real estate costs several million rubles at least)
4.3. Investments in securities
The securities market is traditionally considered one of the most profitable options for increasing money. The average yields are at the level of 8% -20% per annum, provided that you operate on the "buy and hold" principle. If you are engaged in trading, then you can significantly increase these numbers and get 30%, and even 100%.
High profitability and high liquidity allow you to quickly and efficiently manage your capital. Anyone can enter the market, while it is enough to have a small investment. I would recommend entering the market with amounts of 100 thousand rubles or more.
From the article you will learn what passive (residual) income is, what sources of passive income exist, as well as a description of practical ideas on how to create it.
Hello dear readers. Eduard and Dmitry are in touch.
If you are interested in the topic of earnings, then you are probably familiar with the concept of "passive income".
The dream of many people is not to work and still get paid.
If you are one of those people, then this article is for you! Every day today, people create this type of income, and the easiest way to create it is on the Internet.
We will consider all the methods described below in the form of an overview, and which one to choose to build your financial freedom is up to you.
1. What is passive (residual) income?
Passive income- income that does not directly depend on our labor costs and comes to us in the form of a stable cash flow.
This type of move is clearly illustrated by the motto “ Do 1 time - get 100 times».
So, for example, you can make money selling your own knowledge by recording your own video training course on a topic in which you are well versed. Once you create such a course, and then it brings you passive income due to the fact that it is sold many times.
You've probably heard that there are people who do not work anywhere for years, and live only on passive income, for example from investments. They are called rentiers *
Rentier- a person living on interest or dividends, usually from financial assets, renting out property or products of his intellectual labor.
When we see gorgeous beaches with yachts, expensive hotels, houses and cars on TV or in photos, then one way or another all these things are associated with great prosperity and financial freedom.
Passive income - The best way start living the life of your dreams, travel and manage time as you see fit while everyone is working.
2. Why do the poor get poorer and the rich get richer?
If you look at life an ordinary person 30-40 years old, in most cases he spends everything that he earns, often has a lot of loans or borrows from friends "a couple of pieces to paycheck."
All of this is because he does not focus on creating assets that would help solve his financial problems.
Financial slavery is thriving in the 21st century, despite the fact that physical slavery has long since sunk into oblivion.
It is worth remembering here a wonderful quote from John Rockefeller, the famous American billionaire:
Anyone who works all day has no time to make money!
John Rockefeller
This is indeed the case. After all, they become millionaires in their free time from work, and at work people usually earn money only in order to cover immediate expenses.
Thus, it is worthwhile to understand that our main asset is time, and rich people are good at using it.
After all, if you look at an ordinary day of an ordinary person, then we will see a picture repeating from day to day: in the morning - to work, in the evening - from work, cafe, beer, TV.
At the same time, the progress of such a person in the long term is minimal, especially considering that the majority do not like their job and their income practically does not grow from year to year.
The difference between the rich and the poor is what they do in their free time.
It is the correct use of time that is the key to achieving wealth and passive income as one of the tools of financial freedom.
After all, to create passive income, you need it very well actively to work. Most often, several months or even years... But after that, you can quit your job and become a wealthy person.
According to the famous businessman, investor and financial literacy specialist Robert Kiyosaki, wealth is not determined by the size of a bank account, but TIME, during which a person may not work, maintaining a comfortable standard of living.
In order to understand how you can turn your time into a source of permanent passive income, break out of the "rat race" and gain financial freedom, we recommend that you play the world famous financial game by Robert Kiyosaki "Cash flow".
3. Sources and types of passive income
You are probably impatient to find out how you can create passive income and from what sources it can come. Answers to these questions will be given below.
You just have to choose the method that suits you and work on it.
It is curious that most people say: "But a few months or years is a very long time, I am not ready to wait so long."
This is the psychological trap. After all, usually the working period for people lasts 30-40 years, after which they receive only a pension and this, without exaggeration, "handout" becomes their only source of existence.
It turns out that we can work for 30 years in a row (in most cases in a hated job), but we have no patience to take care of our financial future and retire not at 55-60 years old, but say at 30 or 40 years enough.
Do not deceive yourself, because if you have decided for sure that you want to create passive income and have more free time, then you need to take decisive action to change your life!
This was an introduction, and now to the tools and types of creating passive income.
There are only 4 main types of passive income:
Let's take a look at each of them and see what instruments can be used to generate passive income within each type.
1. Investment or financial passive income
It occurs when we invest money in various financial instruments or items, receiving dividends in the form of profit or interest.
Sources:
- the property;
- Bank deposit;
- securities;
- our business (when we buy it);
- equipment for rent.
2. Intellectual passive income
It arises in the case of creating an intellectual product and its further replication. According to this principle, the Infobusiness on the Internet, well-known to many, is built: they recorded their training course once, and then sold many copies of it.
Sources of passive income:
- royalties for a published book, song, role in a movie;
- patent for an invention (technology).
3. Marketing passive income
Arises from established marketing systems such as a commercial website, your network marketing structure or personal brand rental *
A personal brand is a set of social achievements of a person that is associated with his person and can serve as a reason for using his name (reputation) for commercial purposes.
For example, many stars of show business, sports and cinema appear in commercials and become "faces" of this or the company, for which they receive a lot of money as a fee for using their name.
Sources of passive income:
- own well-developed structure in a network marketing company;
- business companies using your personal brand;
- your website on the Internet;
- business, the profit from which is formed from the work of the marketing system (often this is an information business).
4. Legal (legally required) passive income
To one degree or another, almost all people talk about the three types of passive income described above, but they do not say a word about the fourth, we conventionally call it "legal".
But he not only has a place to be, but can become the most easily accessible of all.
You can receive this type of passive income if your life situation allows for legislative level officially receive monetary and other material incentives from the state.
Haven't you guessed what this is about yet?
Naturally, the most famous type of such passive income is a pension. Students have a scholarship. But the working part of the population in most cases is deprived of such "buns".
Sources of passive income:
- old-age pension, disability pension, military pension;
- subsidies (compensation) for utility bills;
- subsidies for starting or developing a business;
- "maternal capital";
- preferential housing for citizens in need.
4. How to Create Passive Income - 7 Best Ideas
Now you know what types of passive income are and with what tools you can create passive income.
There are different options for creating passive income, let's now look at the most popular ideas on how exactly you can ensure yourself a regular flow of money without having to work for it all the time.
Idea 1. Creation of a website for making money on the Internet
Online passive income is gaining in popularity today. If you are familiar with the principles of marketing, have a good command of a computer, then you can create such income even from scratch, with only a great desire to learn new things and a certain amount of free time.
For example, now the site HeatherBober.ru, where you are and read this article, brings passive income.
Usually, to start regularly making money on your website from $ 1000 per month, you will need from 6 months to 2 years of regular work on your project for several hours a day.
For some reason, some people think that making money on the Internet is very easy and having created your site, you can not work anywhere else, as soon as it appears on the Internet.
This is a big misconception. You will have to work very hard on your website and the most difficult stage here is not to break down, but to achieve regular passive income of $ 100-200 per month.
If you have (will be) a site that consistently brings passive income, then it can be sold as a ready-made business. At the same time, the amount for which you can sell a profitable site is equal to 20-24 times the amount of its monthly passive income.
So if you have a website that brings in 10,000 rubles a month, then you can sell it for 250,000 - 300,000 rubles.
Thus, you can even create profitable websites for sale and build your business on it.
It is similar to animal husbandry. You raise a cow and she gives you milk, you can sell it regularly, making a profit, and if you need a lot of money at once, you can sell the cow itself.
On your website, you can earn in the following ways:
- selling links;
- placing contextual and teaser ads;
- posting paid advertising articles;
- selling ad space for banners;
- recommending to buy a product or service using your affiliate link (earnings on affiliate programs);
- selling their own training courses (Infobusiness).
Idea 2. Creation of an intellectual (creative) product
If you have the talent of an inventor, writer or musician, then create your own intellectual product - technology, book or song.
This way you can earn passive income by replicating them (in the case of a book or song) or by renting them out (in the case of technology that can be patented).
For example, the famous writer J.K. Rowling, the author of the Harry Potter books, now has a multimillion-dollar fortune thanks to passive income from his intellectual property.
By creating an "invention", "industrial design" or "utility model", you can also create sources of passive income. After all, it will be yours intangible assets*
Intangible asset- a product of intellectual labor that has no material form, but is capable of bringing profit to a person or company by its presence.
These assets include patents, trademarks, business reputation of a company or person.
Idea 3. Renting out property: real estate, transport, equipment
Passive income on real estate is the most famous of all types of passive income for rent. But there are other ways as well.
You can rent almost everything that has value: vehicles, construction, manufacturing or commercial equipment, and even things worth more than one average salary in your city.
Usually income from real estate is less than from equipment. For example, there are entire types of businesses where construction equipment, expensive rock drills are bought and then rented out.
So a drill or perforator worth 20,000 rubles can be taken for 500-1000 rubles a day! At the same time, the payback period of the tool can be less than a month with a large flow of clients.
Idea 4. Receiving government payments in the form of passive income
If you fall into the category of socially vulnerable citizens (disabled, the large family, pensioner, etc.), then you can apply for compensation payments both of a one-time and permanent nature (the same passive income).
To do this, you need to carefully study civil Code RF or contact the social security service at your place of residence.
You may not know that you should receive thousands, and possibly tens of thousands per month just for the fact that you belong to the people described above. Do not neglect this opportunity.
Some citizens even pay bribes in order to get subsidized housing or disability pension without being disabled.
We do not encourage you to improve your financial position in dishonest ways, but if you have legal grounds for government financial support, why not use it.
Idea 5. Investments in securities, pamm accounts, banks, mutual funds
Investing in various financial instruments is also a fairly popular way to generate passive income.
All these financial instruments were analyzed in some detail in one of the previous articles: ""
While they have their own advantages, they are not without their disadvantages. For example, in a bank, income will be minimal and will barely save your money from inflation.
As for pamm accounts, mutual funds and securities, here in most cases your income will be unstable (with the exception of bonds), and will not be passive.
Rather, by investing in such instruments, you can make speculative profits, but losses are also possible. Be careful!
Idea 6. Network Marketing
This is one of the most available ways create passive income by investing your time, since in most network companies you need no more than $ 100 of money to start.
If you have a talent for finding a common language with different people, you are friendly and full of energy, then feel free to start in this industry and in a few months your passive income can be compared with average salary provincial town.
Very well the way of a person in the process of building his passive income in network marketing is illustrated by the "parable of the plumbing" about two guys Pablo and Bruno. One of whom worked for money, while the other was creating a profitable system at that time:
Idea 7. Own business
A great way to create passive income is to start your own entrepreneurial project.
If you do not have sufficient in cash to start your own business or do not want to risk money, then the best way to organize your business for you is an online business.
Yes, today in the global network, thousands of people make big money.
If you think that starting a business is the best solution in your case in order to create passive income, then you should definitely read our articles on this topic:
Thanks to the information from these articles, you will be able to organize your business from scratch in the shortest possible time and turn it into a stable source of passive income in the future.
For those who want to open their own business with minimal risks offer Alternative option: buying a franchise, a Japanese and Pan-Asian restaurant chain.
Why this particular project? The answer is simple: our good friend named Sergei has already opened a restaurant for this franchise in Maykop and now has a stable profit. The 1.5 million he invested paid off within six months - an excellent indicator for a city with a population of 140,000. In megacities, funds will return even faster.
Sushi Master restaurants are retail outlets of four formats: street, island, food court and classic. The partner receives a ready-made business model, marketing technologies, unique recipes and help from a start-up team. The rest is a matter of technology.
Here is what Alex Yanovsky, co-owner of Sushi Master, says about the franchise's advantages:
Now you know what passive income is, what types of it exist, and what you can do to quit your job, gain financial freedom and be able to travel.
Tips for Finding Financial Freedom:
Tip 1. Take the time to create assets
Try not to limit yourself to just getting money from your work, regularly think about how you can get money for once done work many times - replicate your efforts!
After all, you do not want to be among the people who in old age live on one beggarly pension.
Tip 2. Strive to have multiple sources of passive income
If you can create multiple sources of passive income, then your financial stability will be under reliable protection and if you lose one source of income, then another will always help you out.
Worries many people. The explanation is very simple - everyone would like to be able to earn money without bothering with any work. This is the idea of passive income - getting money without difficulty.
Especially the desire to start looking for such a "source of money" is exacerbated during periods when a person encounters difficulties in his main job and realizes that he does not want to deal with routine paperwork all his life, but would like to devote more time to himself, his family, rest and self-development.
In this article, we will try to describe the most affordable passive income business ideas. Perhaps those who read it will be inspired and find such a source of their own!
Rental
One of the most popular and simplest, perhaps, is the rental income. Such an idea is elementary in terms of resources for organizing such income - it is enough to find tenants for the object that you own. On the other hand, the difficulty is, firstly, getting ownership of what you would like to rent; and secondly, achieving profitability. Let's explain in more detail.
A great passive income idea is to rent an apartment in the city center. What difficulties can there be? Firstly, not everyone owns such a property. This is the main problem. Secondly, if you have such an apartment, you need to find a tenant for it. Third, this person should be offered a rental rate that he can afford and, moreover, that would be beneficial to you. This should also include the cost of cleaning the apartment after the tenant congress, as well as depreciation costs.
In the example with an apartment, everything looks quite simple - it is for this reason that today such a large number of people are engaged in such activities. And let's take, for example, a more complex object - some non-residential premises located on the outskirts of the city. As an owner, it will not be easy for you to find a person interested in such an object.
However, to receive such passive income, you can sublet something. This is, for example, when you rent an apartment on a monthly basis and rent it out on a daily basis. The benefit received is the difference between the rent and the money returned to the owner.
Copyright
Good passive income can promise the creation of some unique object, protected For example, it can be a musical composition, a computer program, a film or an image. With the protection of rights to music, of course, everything is very bad in our country - copyright holders can only earn at concerts. Films profit from movie theater royalties and the fact that they are bought by TV channels. But with a program or a picture, everything is easier. In the first case, you can, say, start selling copies of your design directly on the Internet, getting paid for each install. In the second, by posting the image on photo hosting, you will also generate real passive income.
Ideas do not end with these objects - you can come up with something to patent it and live on royalty payments for its use.
Business creation
Of course, another fairly common way of organizing passive income is your own business. It can be anything - a shop, a cafe, some kind of service that provides services, and so on. The advantages that this idea of passive income has are obvious: by creating one working business and hiring the right staff, you can step back a little from control over it and start developing other projects in parallel. Thus, we can talk about an increase in the scale and growth of your income.
The disadvantage of owning a business is the high level of risk and a lot of difficulties that start-up entrepreneurs face. Also, we must not forget about the start-up capital, which varies depending on which one you would like to deal with. However, this is already a topic for another article.
Online project
The development of the Internet has led to the emergence of another large and global sphere for business. Now everyone can start their own business online. It is noteworthy that the cost of creating such a business can be much lower than investing in a real business. But at the same time, one should not hope that it is easy to work on the Internet - the competition here is no less than in real life. But by launching a once successful project, you can get a guaranteed passive income.
The ideas of what kind of resource it can be (news blog, service, catalog, store, etc.) are not limited by anything.
Investment
Another obvious idea of passive income is investment. There are several disadvantages - high risk and the need to have money for investment. Assessing the degree of risk, the investor decides where he would like to invest, after which he begins to receive dividends. The latter is the whole point of the idea of passive income.
The ideas of passive income in a small city are as relevant as in a metropolis. Investing as a tool for passive earnings justifies itself everywhere and always, the main thing here is to correctly assess the likelihood of making a profit or losing money. It already depends on the area of investment.
conclusions
Of course, the best passive income ideas always remain unknown to the vast majority of people. And only those who have them, and who implement them, begin to use them. On the one hand, this is bad for those who do not know what to do to generate such income. On the other hand, everyone has the opportunity to launch their own source of passive income.
If you have money, it can be renting an object or investing in something. If there is no money, then you can create one based on an interesting idea, or start your own Internet project. In this case, long hard work awaits you, which will certainly lead to success.
And the best passive income idea is the one that works! Good luck in your endeavors!