Financial Freedom is inter- twined with passive income. It is difficult to be financially free without having some form of passive income. So, what is passive income? Here is my definition: “Passive income is any income derived from an initial investment of time, money, effort, or ideas without additional input of time, money, effort, or ideas”
So, for example, the cash flow from a real estate investment is a source of passive income. A published book is a source of passive income. A retirement fund can be a source of passive income. Network marketing that involves ethical distribution of funds to all participants (not only to people at the top)can also be a source of passive income.
In each of those cases, a significant investment was put into the item up front. Time. Ideas. Energy. Thought. Money. Different initial investments require different things. Passive income streams are a powerful personal finance tool. Simply put, a passive incomestream earns income for you while you are doing something else. That something else might be another lucrative path toward earning money, it might be retirement, or it might be engaging in a very speculative career path.
A few caveats, though. First, if you’re not investing money, expect to invest a lot of time and energy. If you want a passive income stream that’s going to give you a long trailing tail of revenue, you’re going to have to invest a lot of time and energy up front without any immediate reward. Often, the more time and energy you spend up front, the larger the reward and the longer it will last.
So, how can you get started?
Invest in Real Estate. Start the process with by either buying a fixer-upper home or better still; invest in a rent to own propertyby yourself or with a JV partner. Since you want this to be truly passive income, the way to do it is to hire a property manager to take care of any issues for you in exchange for a piece of the rent. That way, you just collect the rent cheques and don’t worry about it.
Write a book. Write an ebook and submit it to the Kindle store and the Nook store. This can be done in your home and without a publisher or other outside source accepting or helping you. The key thing here is to make sure you’re creating something that others would want to read. A good place to start is to look at the things you’re good at, as people always admire the skills of others.
Whether you write a book, get involved in a network marketing company or invest in real estate, it is critical to get involved in something that will earn you a small passive revenue stream. With additional effort, these smaller revenue streams can increase your passive earnings.
The big ingredients you need to get started are time and effort. Money will come later.