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Make Money Like It's Your Job: A Beginner's Guide To Passive Income (how to get to the tipping point)

Updated on February 7, 2012

Making Money Through Passive Income

How To Be Successful

Making Money Like It’s Your Job: The Beginner’s Guide To Passive Income

If you are anything like me, you grew up in a household where you were told that the key to being successful and happy was to go to school, get good grades, and once you finished up with college there would be a good job waiting for you. Well, as anyone in their mid-twenties can tell you, this is no longer the case. Unemployment is hovering around 10% and underemployment (people employed in jobs they are overqualified for, but need to stay there because of the limited work available), is also undoubtedly on the rise. College graduates no longer have an automatic job lined up after they receive their dipoloma. It seems as if the Master’s Degree is the new Bachelor’s Degree. This all makes it very competitive to find a job, and so much harder to find a secure job.

So, what can we do about it? Well, let’s look at our options:

Option 1: Work Harder (and hope for the best)

My Dad always told me that “if you work hard, you will always have a job”, and while there is a certain amount of merit behind this statement it is also very general, and doesn’t necessarily mean that you will necessarily have a good job, or even one that you enjoy. Some of the hardest working people out there are still just getting by. They work two jobs just to make ends-meet and have nothing at the end of the month to show for it. The truth is, that if you are a hard worker you likely will be able to find and keep a job, but that in no way means that you will be successful. You see, employers love hard workers, but they would rather keep you under them (making them look good) than promoting you to a job you may deserve. Successful people are not always the hardest workers, but they are the smartest workers.

Option 2: Increase your Education level

It makes sense that as your education level increases, so does your income level. Someone trained in a specialty, such as a doctor, dentist, business professional (with an MBA), or lawyer will always make more money than those with just a general education. Sadly, the costs of higher education have been rising exponentially over the last years. While there are numerous factors, such as, the graduate school you choose and the area of study, but a safe estimate would to expect around $50,000 to complete your graduate degree. So, is the cost of graduate school worth it? Sure, your income will jump (if you finish, and if you manage to get a great job… but these are big ifs..)

Option 3: Create A Passive Income Stream

In my opinion, everyone should take the steps to create a passive income stream. But, you may wonder, how can I create a passive income stream? Well, its not hard, but it’s also not easy… You have to be dedicated to make any real money through passive income. Some of the ways to create passive income are easier than others, but they all work if you are willing to put in the work up front. The key will be setting and achieving your goals. So, the first step would be to write down what your goals are. When you do this you want to be specific and concise. Don't just take out a sheet of paper and write down something like "I want to be financially free" or I want to retire at 45". Instead, be specific with your goals. If you want to be financially free, take a minute to think about it and write down what it means to you to be financially free. Maybe being financially free means having the house paid off and making a passive income of $1000 per month. If you want to retire at 45, sit down and do some math to find out how much you need to retire and then write it down. If you conclude that you will need to save 2.5 million to retire comfortably at 45, that is exactly what you should write down as your goal. Once you have your specific goal down on paper, you need to take the steps to achieve your goal. This will once again take some time to think about, but once it comes to you write it down. Lets say that your goal is to have your house paid off and make a passive income of $1000 per month. First you need to write down how much you owe on your house. Then you will write your plan out to how you are going to accomplish it... You should write down every little thing you think of... If you ealize you can pay off your house in 5 years by paying an extra $500 per month you need to figure out where that extra $500 is going to come from. Maybe you will cancel your cable, and take a part time job delivering pizzas. It really doesn't matter how you get it. It is just important that you get it and achieve your goals. Now for creatign a passive income stream of $1000 per month.The 3 ways I believe that anyone can create passive income are as follows: Investing, Residual Income Earned Online, and Starting Your own Business.

Passive Income Through Investing

For continued reading on passive income through investing please feel free to check out one of my blogs.

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    • Alex Brockie profile image

      Alex Brockie 

      4 years ago from England

      A very well written article and a good eye opener for the youth of today

    • MeanGreen profile imageAUTHOR

      MeanGreen 

      7 years ago

      Thanks. I appreciate the support. Looking forward to reading your material

    • mecheshier profile image

      mecheshier 

      7 years ago

      Nice article. Very informative and personable. Thank you.

      Welcome to Hub Pages.

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