Passive income is your key to financial freedom. Passive income is the money left over after you consider all monies in the business, minus all monies out received on a regular basis, with very little effort required to maintain it. Consider if you were to become ill or were physically unable to work, passive income is what you could rely on.
Thanks to online marketing and the ability for an entrepreneur’s business to be seen everywhere because of the internet, entrepreneurs have embraced the idea of creating passive income streams with enthusiasm and creativity. Although millions of people have tried to create fruitful passive-income streams, only to be surprised by the amount of work, cash or time involved, learning how to create passive income can greatly enhance your earning potential, with far less effort than working directly with clients on a cash for services basis, for example.
Passive Income and Wealth Attraction
There are a couple of effective strategies you can use to create passive income: by generating a revenue stream directly through your business, or through asset acquisition outside your business. Both will require an investment on the front-end of time, energy or cash to start your income stream but, eventually, if your strategy is sound, you will be able to withdraw to a much more passive role as the cash begins to flow toward you.
3 Tips for Entrepreneurs to Generate Passive Income
- Publish a Book – While writing a book is hardly a passive activity, and any income derived from its publication is most certainly earned, because you may not be directly involved in the day-to-day sales of your book, your earnings from book sales can be thought of as a passive income stream. While promoting your book will require some time and effort, the daily work required on your part is greatly reduced once you’ve completed writing your book.
- Try Affiliate Marketing – Whether you become an affiliate of another’s product or service offerings to earn a commission from them, or create your own affiliate network to market your products or services, internet marketing has made affiliate marketing a viable method for creating a passive income stream. After all, if you can encourage others to promote and sell your products or services for you, your direct sales and marketing efforts will be reduced.
- Buy Rental Properties – Investing in rental properties is an effective and time-honored way of earning passive income, not to mention the effect that owning such real estate creates assets that have a direct impact on your wealth building strategy. Contracting with a property manager can reduce the time and effort required to care for these assets, which will turn this income stream into a passive one for you.
In my work with Robert Kiyosaki, bestselling author of Rich Dad, Poor Dad, I stress real estate acquisition to build assets. However, for entrepreneurs doing business online, whether you offer product or services, publishing a book, and becoming an affiliate for others, or setting up your own affiliate program (which is more time consuming), have all proven to be very effective methods for creating a passive income stream.