What Is A Passive Income Stream? And How Passive Are They Really?
If you’ve been looking to make money online for longer ten minutes, you’ve likely come across the term “passive income,” a number of times.
I’ve lost count of the number of programs and courses that have “passive income,” somewhere in the title.
But What Is So Good About Passive Income?
Passive income is a buzz phrase online, usually used to entice people who want to have money coming in passively, without doing much work.
Passive income is essentially just money coming in, that you receive on a regular basis, but that takes little effort to maintain.
What many people don’t realise about passive income, is that you could be working hard for many months, (or many years) prior to truly reaping the benefits of a passive income stream.
For example; while I may wake up to find I’ve made some sales in my sleep, or go abroad and still seeing some money come in… I still put work in online most of the time.
However, I am getting rewarded for work that I did many weeks or months ago. Not the work I’m doing at that particular point in time.
There are also cases where I may receive commissions from websites, that I haven’t touched in many months.
You could say that this is passive income – being paid now, for work that I did in the past.
You lay the foundations, you put in the initial work. But you continuously get paid for it for some time into the future.
Passive income can be a great thing, but building up various levels of passive income is even better.
This is known as: creating passive income streams.
Some Examples Of Passive Income:
You want to aim for income streams whereby, you can put in a certain amount of work today – with the intention of that work paying you long into the future.
You may consider some of the following options online:
- Creating ebooks, becoming a self-published author online – or outsourcing the work, (I did a course about that here).
- Selling something automated online, such as a gig on Udemy, or some training on Fiverr.
- Having a blog or website – where you can earn from a variety of ways, such as affiliate marketing, or advertising.
- Having a successful YouTube channel.
- Recently I discovered Merch by Amazon, where I now sell tshirts online. One design that may only take you 10 minutes to create, could sell for many months or even years into the future.
One of the great things about the internet is that it has given us so many opportunities to create passive income and they’re growing all the time.
Passive Income: Ignore The Hype!
While I can say that passive income is surely a good thing to aspire to, it’s not as easy to obtain as many want you to believe.
Having a very small amount of passive income can be achieved relatively easily, but it’s building on that small amount that takes time.
Unfortunately, there is a lot of hype online about creating passive income, or just about making money online in general.
Yes, a small amount of individuals online do end up becoming very wealthy, but a majority do not!
There are also plenty of people who really try and start making money online, but they give up prior to ever making anything substantial.
Then, there is just everything else in-between: from people struggling to make a few dollars here and there each month, to making a reasonable part-time income and those being able to completely support themselves.
I feel it’s important that people realise that creating any form of passive income, usually takes tonnes of work.
Passive income aside, making any money online in general will take a lot of work and unfortunately, most people who are initially attracted to the idea to making money online, are not aware of that.
It doesn’t help that for anyone looking to make money online, they’ll normally be bombarded with get rich quick schemes and “testimonials,” from people who have changed their lives over night by some magical system, program, or course.
Don’t put Your Eggs In One Basket!
If you’re committed to making money online, I think it’s also wise not to completely limit your options to one thing.
If you work on creating various income streams over time, then you will not be entirely relying on one source of income.
One of the downsides working for yourself, is that it’s not going to be “secure,” in the way you’d imagine a job to be.
That being said, people often feel wrongly secure in their jobs – only to lose everything once they’re “let go.”
So, nothing is entirely secure – whatever route you take.
But one way to help yourself when you make money online, is to build up a portfolio of different ways you can bring in an income.
Just make sure that each income stream is bringing in some money before you start on your next venture, or else you’ll just end up overloaded with too much work and not enough time to dedicate to anything.
(Yes, I have done this myself! Still working on it!).
I remember about a year ago I intended to have several websites on the go, a physical product on amazon, create ebooks online and do some freelance writing.
But pretty soon I realised, that I needed to focus on one thing at a time. Once you feel you have a grasp on one thing, you may be able to carve out some time for your next venture.
If You Do Make It Online:
The great thing about building an income online is, that if you DO start making enough online to support yourself, you can live anywhere you want.
Well, anywhere with an internet connection.
In a regular job, you will generally have some salary limit there too. There’s a point where you’re just not going to earn any more.
Strangely, this is what billions of us passively resign ourselves to.
I understand, because I used to feel that way. I didn’t realise that there were any other options and even if there were, I didn’t know where to look.
What do people normally do when they have an idea about something, but absolutely zero idea how to execute that idea?
Well, most people just put it off. Then, they put it off some more.
Suddenly, a decade passes and still nothing has been achieved, eventually – people just give up on the idea.
Is Passive Income, Ever REALLY Passive?
Generally, even when an income is fairly “passive,” there is still some level of maintaining it required.
Or, in most case, growing that income further.
For example; I could stop what I’m doing tomorrow and still have a little money coming in for many months, or maybe years.
Actually, it would probably even grow for a while.
But somewhere down the road, it would slow down….. and then stop.
For the most part, there is some action required to keep the passive income streams healthy and well.
Most income streams are not entirely passive!
Although, technically could be if you outsourced the work to someone else.
For example; some people grow their websites to a certain income level and then use some of that profit to hire help – who can do anything from hiring writers for you, technical upkeep, social media management, email marketing and so on.
At which point, there would be very minimal work to do from your side at all. But reaching an income level to sustain that, would obviously be the challenge.
What do you think about passive income? Are you generating any passive income streams…. and how passive are they really?
Let me know in the comments!
All the best,