The average person in India is not even having 3 months of income saved in the bank. How much do you have saved? How long could live if your paycheck is stopped coming in? Maybe you have never thought of that and it might be the right time to think about. Today I am going to share with you about passive income.
With the passive income how to design your dream life by building up your passive income streams.
What Is Passive Income?
Why passive income important to us? Before 3 years, I knew nothing about passive income. I knew about earning money and spending only. That’s called active income or earned income. That is what we do when we get a job. That is what 99% of the world is doing.
Passive income is the income where you do work only once and it keeps paying you regularly. In passive income, you will get paid recurrently without any work. when your passive income exceeds your cost of leaving, you become financially free. If you stop getting your paycheck or you lose a job, still you can live with your passive income and pay your bills. That’s why it is important to have a second source of income.
Why Passive Income is Important?
Can you think of reasons why could your pay check stops coming in? It could be due to you are sick, you lose your job due to economic condition, your industry changes, merger between two companies and so on. There are many reasons that you might lose your job and thus your active source of income. And that has nothing to do with your competency.
That’s not the great situation you should be in, right? Financial security is based on the certain circumstances that could be out of your control. There are lots of people who don’t like their current job but has no option so they are dragging it. As per the report published by Economic Times, only 20% of people are happy with their current job.
Ask yourself, could you continue your current job for the next 20, 30, or 40 years? The absolute answer is NO! At least I can’t see myself dragging it for next 30-40 years of my life. So what is the option? What should we do?
Create a source of income for which you don’t have to work much. A source, which will keep giving you money on a recurring basis so that you can live your life the way you want. Passive income is such a source of income through which you can live your dream life. Most of the time we live paycheck to paycheck and don’t have enough money or savings to live our dreams.
There are many real-life case studies who have make their fortune with passive income. These are not the billionaire people, these are common people like you and me. These are the people who have picked up the strategy of generating passive income and became financially free.
Passive income will not make you rich overnight. If anybody tells you that by doing something he/she became overnight rich, don’t believe them. It’s a process and will take time. But remember, it will not take ages. Continuous efforts and discipline will make you financially free.
You don’t need special skills or ability to generate passive income. What is needed is knowledge and discipline. Passive income is a strategy. If someone happens to get a degree doesn’t mean that they will become legend. Anyone can achieve the same result with knowledge and discipline.
Having a passive income is all the more important in India because as we saw above that around 80% of the people don’t like their current job in India. Out of those 80% people, one third are literally hate their jobs but they don’t have any option because they don’t have any other skills.
Passive Income Streams
Sometimes we work all the day hard that we don’t have energy to think about passive income or how to live better. And I am sure no one of us want to be in that position. So this is the perfect time to take action to really check the ideas you have in your mind but not able to implement due to various obstacles.
There are various sources of passive income which can help you to design your dream life. Few of them are:
- Renting your property
- Active Investment
- Real estate investment
- Blogging / Youtube channel
- Affiliate Marketing
- Multi level marketing
- Write a book
- Peer to Peer Landing
- Create an online store
- License your photos
- Rent your car space to advertise
- Sell your stuff on Amazon
- Be a sleeping partner in a business
So there are many more options available to have a second source of income. Most of the time we are focusing on the earning money, but we don’t focus on what to do with that money. If you invest your money in a proper way, it can earn you while you are sleeping. Understand the concept of compounding which known as the 8th wonder of the world.
Invest your money in a way that it will generate you a good returns in a long run. The strategy should that the investment should not be too risky so that you might lose your capital employed. If you are smart, you can make that money really hard for you.
Your future is where you are right now. You are student and you are eyeing a job in the future, do it. There is nothing wrong in it. You love your job, keep doing the same thing. That’s not a problem at all.
But in future, you may find yourself insecure in your job, your desire change, your circumstances change then you don’t have to worry much. As you have your another source of income with you to take care of your expenses.
Just imaging what would you do if you don’t have to exchange your time for money? would you travel? What is your passion? these are the questions we don’t ask our self more often.
You can follow whatever you love without worrying about your pay check. You don’t have to worry if you are financially successful and you can follow your heart. For me, that’s very important in life.
Things that you need to bear in mind to keep your passive income coming:
Build from the Scratch: Build from the ground up. Whatever is your passion and keep doing that if you think you can turn it into money, invest it and do everything to gain traction.
Thrive for Productivity: By thriving, I don’t mean to work like a donkey. Instead, manage your time well and have a meaningful and measurable impact in whatever you do.
Automate: Create a system for your passive income that you know will continue and still bring you money even if you decide to take a vacation for a month.
Keep a track: Keep a track of all your cash flow and keep all your financial document up-to-date. You should know on what you are spending. Which helps you to keep a track of your money and save.
So we discuss what passive income is, why it is important? how can you have passive income to design a life you dream of. Most importantly, to chose what you want to do with your life.
Initially, they seem risky, impossible, but a little bit of education and action you can do whatever you want to do. See the possibility of what else you can do to generate your passive income so that you can be financially free. Think about the risk of not doing this. what is the risk if you are settled and live the life you wanted to. What is the risk if you are not taking action?
Don’t worry about the HOW, just focus on WHAT can you do to have a life you ever wanted to live.