If you want a steady stream of income that is not based on the time for money model then passive income is it.
What Is Passive Income? Passive income comes from creating something that typically requires significant upfront input. Active income, on the other hand, can only be obtained by exchanging your time for money. The rich generate passive income from a variety of sources like real estate rentals, dividends, interest income, royalties, franchise fees, laundromats, and website ads.
The Reasons Why Passive Income Is So Important.
Passive income is earned by making something that needs a considerable amount of upfront effort. It needs little to no maintenance in order to continue making money. Creating an online course is one example. On the other hand, active income can only be achieved by directly exchanging your time for money. If you work a pay-per-hour or salaried job, the amount of money you receive is equal to the number of hours you work.
- Passive income allows you to be more flexible with your time.
When it is said and done, our most precious asset is time. In fact, time is much more valuable than money. Your revenue steadily exceeds your expenses when you add new passive income sources, and you gain true financial freedom.
- It alleviates stress, anxiety, and fear of the future. Nothing is more stressful than the stress of not being able to pay your bills. It causes anxiety, fear, and a general sense of foreboding about the future. Reduced reliance on passive income alleviates many of these concerns. Passive income also aids in the development of financial momentum in one’s life.
- It allows you to focus on what you enjoy doing rather than what pays the bills. Passive income frees us from debt, which keeps us trapped in a never-ending cycle of payments and interest. It assists you in escaping the rat race by elevating you above all of the concerns that so-called ordinary people have. It also allows you to follow your heart while earning a living.
- It allows you to live and work from anywhere. When you have a consistent flow of income, you can pack your belongings and hit the road. You can live and work in Chiang Mai, Bangkok, Berlin, or almost any other city on the planet.
When your income is automatic, you don’t have to worry about meeting your monthly expenses by exchanging your direct time for money, which gives you more time to think about and discover new ways to improve and develop your financial stability. This gives you financial clarity in your head, which motivates you to meet your financial goals.
Originally Written ByBarnaby Holder