Income: Which is Better, Linear or Passive?

Linear income is also called active income; this is the income that you earn a specific amount of income for a specific amount of your effort. To earn a linear income you also need to be present at your supposed workplace, whether that be a doctor, lawyer, etc., practically every employed or self-employed person is earning linear income. If they don’t attend to their clients, they won’t get paid.

Now what about passive income? It still surprises me as to how many people do not understand the concept of passive income. It is an income that you continue earning even when you are not working. Sound unbelievable? Well believe it because thousands of people have made it, even me. Passive income, also known as residual income, is a stream of income which you can earn many times, with your one specific amount of effort. Here are several sources of passive income:

1.       Royalty income. Authors, song writers and many content creators are paid royalties every time their book, songs, or curated content is purchased or used, regardless of how long ago they made it, depending on any copyright agreements. This is a form of royalty income and the best part is, in many cases, it continues for the rest of their lives.

2.       Dividends. This type of passive income is generally created from an initial investment. It can come from stock investments, where listed companies share their income with their shareholders in the form of cash dividends based on earnings. Dividends also come from mutual funds and angel investing.

3.       Real estate. Your real estates can be rented out to earn a good amount of passive income. Now let me be clear about this, when I say real estate, I am not just talking about housing. Real estate is property and property is anything that you own. You can rent out your house, your car, and your web space; basically anything that you own that you can rent or lease to bring income in is real estate.

4.       Interest income. Interests from savings / fixed deposits, etc. This is most commonly attributed to compound interest.

5.       Websites. This is to expand on what I mentioned in 3. Websites have become an effective place to sell your products and services to the mass and earn big bucks! You don’t have to watch the website 24-7 as your clients will be able to purchase your products / services online without much hassle with the advent of online transaction. Going back to 3, you could “rent” your website out by not even promoting and selling your products, but rather promote someone else’s product or service and receive an affiliate commission for promoting them.

How do people actually get rich? The answer: By having multiple passive streams of income. Don’t have all of your eggs in one basket.

So, would you rather earn linear income or passive income? Why not do both and become financially successful faster? I have published books, I promote multiple affiliate programs and I physically work as a marketing/ copywriting consultant and coach. Remember that money is a tool, not a final goal.

Power Question:

How can you get the knowledge, information, training that you need to accomplish your goal?

Power Question?

What are three worth while activities that you could do this week to move you forward with your success goals?

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