Importance of Passive Income
Importance of Passive Income
By the time this is written we are just about 1.5 years from the crush of our financial system. A large number of jobs were lost and large numbers were made unemployed. When this happened many individuals all of a sudden find that they have absolutely no safety net. The time they stop work is the instant when the paycheck stop coming in. Most are in the state of desperation, anxiety and at a loss of what to do.
This event has finally revealed the importance of alternate source of incomes besides earned income. In Robert Kyosaki’s Rich Dad Poor Dad he talked about three different types of income – earned income, passive income and portfolio income. A lot of people we meet out there, your pals, folks you meet on the road or family members are likely to be making their living from earned income. If you pay careful attention to their dialogue you will realize how they plan to improve their cash situation.
A hourly paid person may talk about how he can putting in more overtime so as to bring home more cash, a salaried individual who go to work in a company is probably discussing with his associates how he intends to get more academic certification, accumulate more experience on the job and climb the ladder so that he can make more money.
Nonetheless, little do they realize that their strategy may work during the good old days of the Industrial Age where changes aren’t as drastic and needs less great. But in this new Information Age relying on just a regular earned income will place them in a more dangerous situation particularly when they don’t know how to handle their finances and they have gathered more liabilities than cash generating assets. Jobs are made obsolete as rapidly as they are created and salaried employees will suddenly find themselves made redundant with no recourse.
Nevertheless, have you noticed why you do see some people on a busy working day are able to have time to relax in a nice club or by the sea enjoying the wonderful surroundings and sunshine outdoor and the only thing they would talk about is how their investments are doing and how much income they are generating from them?
These are the individuals who are wealthy and are making their money work hard for them instead of them working hard for money. Put simply they are profiting from the work of others. Many business owners and wealthy individuals fall into this category and they actually get paid MUCH MORE money to WORK VERY LITTLE.
You need not envy them because you can get there also. And you do not need much money to earn income in this category. Several home-based businesses now use the power of the Internet to allow you to earn big PASSIVE INCOME from your kitchen table.
Passive, residual income is when you earn a commission on the sales others in your organization make. Nowadays the powerful reach of the Internet and simple online automation can make this dream a reality for virtually anybody.