There are many skills that an entrepreneur must develop and continually improve. Being in business for yourself is extremely rewarding, yet one must be prepared. There will be challenges to overcome, otherwise your business and dreams will die. Do not let that happen to you. Learn the skills that every entrepreneur needs to be successful in today's global economy. Start getting your information here.

Creating a product to sell is decidedly active, not passive. And selling other people’s products is active too when you have to build your own store and maintain inventory. However, if you use dropshipping, all you have to do is set up a store and drive was web traffic to it. Everything else is handled by another company and you walk away with a share of the profits.

One word of advice, and something I intend to do once I have the money saved up, is to build or buy out property that can support apartments or townhomes. One tough mistake some people make is buying a pair of homes to rent out and they get a nice $2,000-$3,000 a month but that’s it. Buying a house is expensive and the rental prices keep lower income families from potentially coming to you with their money to rent. If you have an acre to work with (more or less is OK too) you should be talking to a contractor to build apartments or townhomes. You will make a little less per unit BUT your audience grows significantly because now you can have college students, single parents, older folks, etc. all able to afford your rental units AND instead of capturing one $1,000-$1,500 a month payments, you can probably charge $700 a month per unit (or more, depending on the market) and build maybe 3, 4, 5, 10 units for the price of a home or two and now you’re making something like $2,100-$10,000 a month. It all depends on what you have to invest but if you’ve got $250,000+ I’d highly suggest you talk to a bank/investor that can get you in touch with a good contractor to build on a property and get permits and take out a matching $250,000 loan (I’ve read that $500,000 is plenty to build a good amount of apartments to start) and you can fill up your apartments and make a killing every month. You’ll have more tenants to deal with but if you’re competitive with your pricing you won’t have a hard time keeping tenants or replacing them.


But that’s more like a fairytale. You’ll have to put in some effort to continue receiving residual income on the business you started. Talking to your managers and representatives will help them be more productive and run your business better. Marketing your online sales through social media and your network will help earn you more money. But you just won’t have to work at it as your full time job. Think of it as a part time job that can potentially bring in full time pay.
Financing -- Sure, it's great if you have money to invest in a custom blog theme, advertising, or to hire other bloggers to help out in the beginning, but it's certainly not necessary. In fact, my highest-earning blogs were all started without spending a dime over the domain name and hosting (and since several are hosted together, that saved on the startup costs after the first). You can afford $10 or so per year. If you can't, you probably need to re-think your entire freelance career before you start planning new residual income streams.
There are so many great resources today at our fingertips to learn about the world of investing, business, and finance such as blogs, podcasts, and online courses. However, I feel the most tried and true method is still by reading good ol’ fashioned books. I’ve collectively spent a few hundred dollars to purchase these books, but I can tell you that they have resulted in countless dollars in savings and millions in current and future earnings. There really is no better return on investment.
Peer-to-Peer Lending: Earn up to 10% in returns by lending individuals, organizations and small companies who don't qualify for traditional financing through peer-to-peer lending platforms like Lending Club. You can lend $100, $1,000, or more to borrowers who meet lending platform financial standards. Like a bank, you'll earn interest on the loan - often at higher returns than banks usually get.
Peer-to-Peer Lending: Earn up to 10% in returns by lending individuals, organizations and small companies who don't qualify for traditional financing through peer-to-peer lending platforms like Lending Club. You can lend $100, $1,000, or more to borrowers who meet lending platform financial standards. Like a bank, you'll earn interest on the loan - often at higher returns than banks usually get.
Once again, though, it’s like starting any company. While you might not necessarily need to know how to code, you do need an entrepreneurial mindset, work ethic, and personality type, and you’ll probably struggle for years, going through a string of failures before you finally get it right. If you’re successful, though, the passive income potential is enormous.
Keep in mind that most passive income business ideas usually become largely profitable after a certain amount of time, depending on the time and money you put in. It is important to know that some, also, never make it and fail - just like any other business in the world. However, some passive income businesses are more vulnerable and others are less risky and more prone to giving a good payout at the end of the month.
All that being said, the residual income valuation approach is a viable and increasingly popular method of valuation and can be implemented rather easily by even novice investors. When used alongside the other popular valuation approaches, residual income valuation can give you a clearer estimate of what the true intrinsic value of a firm may be. (Don't be overwhelmed by the many valuation techniques out there - knowing a few characteristics about a company will help you pick the best one. See How To Choose The Best Stock Valuation Method.)
P2P lending is the practice of loaning money to borrowers who typically don’t qualify for traditional loans. As the lender you have the ability to choose the borrowers and are able to spread your investment amount out to mitigate your risk. The most popular peer to peer lending platform is Lending Club. You can read our full lending club review here: Lending Club Review.
However, the RI-based approach is most appropriate when a firm is not paying dividends or exhibits an unpredictable dividend pattern, and / or when it has negative free cash flow many years out, but is expected to generate positive cash flow at some point in the future. Further, value is recognized earlier under the RI approach, since a large part of the stock's intrinsic value is recognized immediately – current book value per share – and residual income valuations are thus less sensitive to terminal value.[5]
However, this comes back to the old discussion of pain versus pleasure. We will always do more to avoid pain than we will to gain pleasure. When our backs are against the wall, we act. When they're not, we relax. The truth is that the pain-versus-pleasure paradigm only operates in the short term. We'll only avoid pain in the here and now. Often not in the long term.
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4. We do our own IT, website design and implementation, write all our own materials, do ongoing research to keep it fresh and develop new products and technologies, market, mail like madmen (our emailing subscriptions alone cost us $1,100 per month, but we’ve got a list of 15,000 after four years in the biz), and somehow manage to keep the dishes clean, food in the fridge, and love our 4 kids as much as we can.
Think and Grow Rich – This classic was first published in 1937 but is still regarded as one of the best business books of all time. Why? The author, Napoleon Hill interviewed 40 millionaires to understand what made them successful. He tries to take all the wisdom from these interviews and organize it for his readers in the form of 13 principles that he believes can help anyone become successful. It’s still relevant for everyone today.
But what he’s most well-known for is being the mastermind behind the SmartPassiveIncome blog and podcast, the latter of which just reached its 10 millionth download yesterday. Last month he shared his tips on how to make passive income. Below, he tells us about his personal journey. (He also says you can say hi to him on Twitter and he’ll say hi back.)
What Every Real Estate Investor Needs to Know About Cash Flow – The focus of this book is making sure that you have a deep understanding of the numbers that drive a good real estate investment. The key emphasized here is that investing for cash flow is preferable to speculation. There are some great case studies in the book for those who learn well using those.
I have a system in place to make sure it doesn’t happen. I have my wife who is helping us stay grounded and making sure my head doesn’t grow too big. But I also say to my audience, Hey, If you see me becoming somebody different from who you know I am or who I’m supposed to be, then catch me before I get off track. I’m not about buying a huge mansion, or really fancy cars. I’m more about the family and making it comfortable at home and going on family trips and creating memories.
There is a specific tax definition of passive income, known as “passive activity” to the Internal Revenue Service. Passive income is any income you make without actively working or are materially involved. The IRS defines it as any rental activity or any business in which the taxpayer does not “materially participate.” Nonpassive activities, or active activities, are businesses in which the taxpayer works on a regular, continuous, and substantial basis.
Once people find success, what commonly happens is they don’t believe that they deserve it or they believe it was accidental, and that’s crept into my head a few times. It’s a very debilitating thing. You start to doubt and you stop working and you stop believing in yourself and you stop putting as much effort in. But I also have a great group of friends who help me with those feelings, and just realizing how many people’s lives I’ve touched and all the notes I get help. That’s why I have that large 5’x5’ space on my wall with notes on it saying “Thanks, Pat,” “Thanks, Pat.” I have a folder in my inbox just for testimonials of what I’ve done — it helps me remember that I’m actually making a difference, and it’s not accidental, this success.
That opportunity was always there, but I didn’t realize it until after four or five people said, “Pat, your stuff is so good, I would pay you for it.” That’s when I finally took action. I began reading as much as I could about doing business online and listening to podcasts and reaching out to people doing it already. I connected with them and created an ebook study guide, a digital book that could help my visitors pass the LEED exam.
Interesting post thanks. I have had similar thoughts about the passive income model – it’s not “passive income” at all, it’s just a different business model where you do the same amount of work to build a product/service and support clients in a slightly less direct way than standard freelance/project work. There are also greater risks with the passive income model – if you are simply selling your time as a freelancer or WordPress agency, you are guaranteed to be paid for your time. Whereas you can spend months or years developing a product, service or blog in the hopes of attaining “passive income”, only to find that it doesn’t take off and you never get paid for this time. In theory the gains of a passive income business are greater as it is scalable and the amount of work doesn’t necessarily increase as you get more sales, but the risks are greater too.
The ABCs of Real Estate Investing – It’s a great overview of real estate investing particularly in multifamily properties. It covers topics on how to perform due diligence, negotiate a deal, and manage properties. It really focuses on the fundamentals – the basic calculations needed to be a successful investor. It’s quite direct and easy to understand.
These photos don’t have to be really impressive at first sight, or mind blowing at all. Regular everyday photos of chickens, or iPads, or desks with some drawings on it get sold as well as others as you never know what someone might be looking for. Places like Shutterstock and iStock are among the best in their league as they also have the most buyers which is what you really want.

Bryan added: "If you make your choices based on, not 'how can I get money for free?' but on, 'What challenge can I put in front of my face that's going to have me step up to be the kind of person I'd rather be?' you're going to start to forget about wanting passive income, and you're going to start to focus on what purpose you truly want to create the world."


This startup work is something that anyone involved in establishing passive income will admit requires some serious elbow grease. It’s the great exception to the whole notion of “passive” income in that it’s decidedly not passive. And for the most part, this is acceptable. People seem to get on board with this idea. “Hey, if I just buckle down and do a bunch of work right now, I’ll be able to sit back and enjoy the fruits of my labor later.” It’s a simple enough concept.
Fundrise – With a minimum investment of just $500, investors of all types can make crowd-funded real estate investments through Fundrise. This means you get the benefits of being a landlord without actually having to deal with owning or managing the properties yourself. Even though we own 2 rental properties, we recently began investing in Fundrise ourselves. We love it because there is no “accredited investor” requirement, making it far more accessible for the average person than the other two options below. Follow the link above to learn more, or read our full review here.
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This was by far my biggest return on investment. It took about two weeks to figure out how to format my book for paperback and get setup for Createspace, but this is nearly 70% of my revenue. It’s ironic because my e-book is $4.99 and my paperback is $14.99. I priced the paperback higher because I wanted to drive readers to the ebook, where I could update it more easily. What I learned, however, is that many of the people buying my book are parents, not students, and they are more familiar with paperbacks. There is also an incorrect perception that you need a Kindle to read Kindle ebooks.
Under throughput analysis, the only factor that matters is the impact of a proposed investment on the ability of a business to increase its total throughput (revenue minus totally variable costs). Under this concept, the main focus is on either enhancing throughput through the bottleneck operation or in reducing operating expenses. This analysis requires a consideration of bottleneck usage by the likely mix of products to be manufactured, and their margins. This is a much more detailed analysis than is contemplated under the more simplistic residual income approach.

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I would consider it 50% passive because the portion that generates money from ads occurs at any time. I guess you could also view it as an upfront time investment, but now that you have a following, I’d imagine a lot of the passive portion of the earnings would still come through viewers even if you decided to take some time off blogging! Reading some of the comments here though (traffic dropoff), I guess it is less passive than 50%.
Residual income is different from a salary, or linear income, which is paid out strictly based on the number of hours a person works. Someone who works on a salary is often said to work “paycheck to paycheck.” This is because he pays all of his bills with his first paycheck and then must wait until he gets paid again to have more money. Ideally, someone will work hard building up a business so that he can enjoy the residual income once his goals have been met. Then he can work on additional projects while still earning money from his business.
If you’re interested in putting some of your content behind a paywall, our very own Protected Content is where it’s at. This plugin makes it easy to create a membership site that sells access to just about anything. You can protect your content in a number of ways based on certain posts, pages, categories, links, keywords, files, and more. This is a quick way to earn some income from your site.
The VA generally recommends a debt-to-income (DTI) ratio of no greater than 41% with your mortgage payment included. It’s not a line in the sand, for reasons we’ll get into below, but it’s important to keep an eye on it. DTI is a comparison of your monthly debt payments to your monthly income. It includes any monthly credit card payments, car payments, student loans, personal loans and mortgage.

Similarly, you can also become a sponsor for a company. This is a lot more difficult to do. If you have a popular blog/website, then you can directly contact companies that sell products relevant to your niche. You can set up a sponsorship deal, where you promote their products on your website. In return, you receive either a flat-fee or a commission-based fee like with affiliate marketing.
These photos don’t have to be really impressive at first sight, or mind blowing at all. Regular everyday photos of chickens, or iPads, or desks with some drawings on it get sold as well as others as you never know what someone might be looking for. Places like Shutterstock and iStock are among the best in their league as they also have the most buyers which is what you really want.

A very thoughtful list here. Another relevant book published this year is “Retirement Planning for Young Physicians” by Dr. Ralph Crew. It covers many of the topics discussed here from the perspective of a physician who has successfully saved and retired. The book adds a lot to these discussions with a focus on the importance of lifestyle choices, as well as a realistic (though sobering) view of likely future physician income trends and how to plan accordingly for retirement.
Comment Policy: We invite readers to respond with questions or comments. Comments may be held for moderation and are subject to approval. Comments are solely the opinions of their authors'. The responses in the comments below are not provided or commissioned by any advertiser. Responses have not been reviewed, approved or otherwise endorsed by any company. It is not anyone's responsibility to ensure all posts and/or questions are answered.
Try to write one good post about an expensive product or a list of expensive products that you recommend and actually use. Make sure it has good SEO and wait about 6 months for it to start making money. This is what started making me money at first. My Non-toxic play mats posts got on the first page of Google results and it started making me affiliate income.
Being a successful blogger is a lot harder than it looks. Being able to consistently generate enough quality content to earn a loyal and enthusiastic audience separates the men from the boys and Jitendra is clearly one of the up and coming young men in the global blogosphere. He has the passion and tireless drive it takes to cover all of the bases and continually deliver fresh, valuable information that helps his readers make money and keep coming back for more

So as you can see from the above example, using the concept of residual income, although Company X is reporting a profit on its income statement, once its cost of equity is included in relation to its return to shareholders, it is actually economically unprofitable based on the given level of risk. This finding is the primary driver behind the use of the residual income method. A scenario where a company is profitable on an accounting basis, it may still not be a profitable venture from a shareholder's perspective if it cannot generate residual income.
But that’s more like a fairytale. You’ll have to put in some effort to continue receiving residual income on the business you started. Talking to your managers and representatives will help them be more productive and run your business better. Marketing your online sales through social media and your network will help earn you more money. But you just won’t have to work at it as your full time job. Think of it as a part time job that can potentially bring in full time pay.

I wanted to specifically call out one particular strategy within equity investing that bears mentioning – dividend growth investing is when you focus on stocks that not only pay a dividend but have a history of strong dividend growth. When I was first building my portfolio of individual stocks, I focused on buying companies with a history of dividends, a history of strong growth, and financials that supported a continuation of both.
Also, I know from my personal experience that when you only do something because you think it’s a money-spinner you end up nearly killing yourself to get the idea over the line.  I remember creating a careers advice site that bored me to tears.  Every word I wrote, hurt a little.  All 200,000+ words!  Do not put yourself through this pain.  I know I won’t ever again.
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