There is hardly anything more amazing than being able to earn money while you sleep. Passive income is described as being inflows of cash earned without the need for any actual effort.
Almost sounds too good to be true isn’t it?
Well the thing is, passive income is indeed very much real. Investors and financial experts have long talked about the benefits of being able to earn passive income. For example, rental income and dividend paying investments have long been a mainstay of many portfolios.
However, more often than not, the term passive income and multiple income streams have over the years become hijacked by pyramid scheme purveyors and other con artists. These schemes usually entice victims with promises of 5 figure incomes without having to do anything at all.
In fact, all they’d need to do is to invest in a particular scheme and they’d be free to sit back and watch the cash roll in.
Obviously, all of this is nothing more than hogwash. Get-rich-quick schemes and other multi level marketing scams are at best a waste of money and at worst; outright criminal.
All of this would obviously put anyone off the idea of generating multiple passive income streams. Fortunately, there are ways for a savvy investor to generate his/her own source of passive income.
Here are some examples that actually work:
1. Investing in real estate
Real estate investment is unsurprisingly one of the simplest ways for an investor to successfully generate a passive flow of income. By purchasing a property, you’ll be able to earn rental income on your property.
When properly planned out, having a steady stream of passive real estate income flowing in is extremely rewarding. Before putting down a payment for your first building, you’ll need to be aware of several things.
Firstly, real estate investment is a long-term game. Don’t expect to be rolling in cash within the first 5 years. Unless you’re paying for your property in cash, the majority of your rental income will go to repaying the loan. However after you’ve successfully paid off what’s owed, you’ll be free to enjoy that sweet rental income.
You’ll also need to remember that your tenants are as vital as your location. Being stuck with a deadbeat who damages everything and never pays the rent is as good as signing up for a liability. Always take note of who’s renting from you and if needed, conduct a background check.
2. Earn interest on your savings
To the uninitiated, interest income is defined as revenue derived from interest during a specific time period. If you’ve got holdings of cash, why not make your money work for you? Park it in a high-interest savings account or fixed deposit and get paid by the bank for doing so.
While interest income isn’t the fastest or most lucrative method of earning passive income, it is almost entirely risk-free. You won’t have to keep an eye on your investment, and it’ll keep steadily ticking away.
Before long, you’ll be surprised at how much passive income you’ve managed to generate with your deposit over the years.
Yes, you read that right. Betting or gambling as it’s otherwise known is very much so a legitimate way of earning income passively. When examined objectively, gambling actually has plenty of things in common with investing.
Just like investment bankers, professional gamblers take note of a variety of factors when placing their bets. Take Super Bowl wagers for example, before placing their bets, punters often study the past performances of various teams whilst also taking into account factors such as weather and venue. This allows them to make a fairly educated guess as to the outcome of any game to better manage their risk exposure.
In some ways, professional gamblers are even more analytical than investment bankers and so-called investment gurus. Of course, just like any other investment, you should always practice prudent risk management while never getting emotional.
The road to financial freedom may be a rocky one, however with the right attitude and a few smart investments, you too can live the life that you’ve always wanted.