Secrets of passive income
Life is the most precious commodity we have. If you’re under thirty, it can seem like it will go on forever. But it won’t.
The good news is that we now seem to have more time than we’ve had at any point in modern human history, thanks to advances in medicine, sanitation, hygiene, agriculture, etc.
For most of the last 500 years, the average person that survived infancy could expect to live between 35 and 40 years. Disease and infection killed most of us long before old age got the chance.
The chart below shows how much and how quickly our lifespans have increased:
You can find the original chart at Ourworldindata.org which discusses the data in more detail.
If you’re wondering what this has to do with passive income, this is where we get to that. The vast majority of us work for a wage or a salary. This really means that we’re selling our time, the essence of our lives, for money. We’re selling time that we could spend with our wives and children, or our parents, or traveling, or writing, or growing an organic garden, or volunteering at the local homeless shelter, or improving our fitness and health.
This is an important secret of passive income: If we’re earning a salary or a wage, we’re not just selling time, we’re selling our very lives. No matter how good the pay is, we’re still selling something that we can never buy back. It’s a secret that our bosses don’t want us to learn. Fortunately for them, most of us never will.
Passive income gives us the freedom to SPEND our time instead of SELLING it.
Seeing income in terms of what we are REALLY trading to earn it helps to keep our lives in balance and our finances in perspective. It’s one thing to pay $2,000 for the latest flat screen, but would we trade a treasured memory for it? Most of us could have created some wonderful memories with the TIME that we’ve traded to buy things that may only end up costing us even MORE time.
Most people think of passive income as the privilege of the very wealthy. One of the themes of period shows like Downton Abbey is that the landed gentry or the aristocracy had social status that not only didn’t require them to sell their time for money, it forbade them from it. In centuries past, it was the privilege only of a relative handful of aristocrats to have passive income and to spend their time instead of selling it.
Now we come to the second important secret of passive income: in 2016, anyone that wants to develop passive income can.
If you’re like most of the people I talk to, you won’t believe that last statement, but it’s true for literally the first time in human history. It doesn’t matter whether we grew up in a trailer park or a mcmansion, anyone with the desire to live on a passive income can do it.
This is due partly to changes in culture that have broken down the barriers once erected by the aristocracy, but it’s mainly due to computer and internet technology and a huge shift in economic priorities.
Throughout history, business consisted of producing a good or service and selling them one at a time to buyers that needed and could afford them. The market places were small in most cases, and totally limited by geography.
Today, we can produce just one product and some kinds of services and sell them over and over again without needing to manufacture, package, label, or ship a single physical item. If that seems impossible, consider an ebook or an mp3 song, or an image, or a video that can be uploaded once, but downloaded an infinite number of times without raising your production costs by more than a few tens or hundreds of dollars. And instead of a market that’s limited to a few mile radius from the place where products are produced, it is a simple matter to reach literally around the globe with digital products.
Anyone can write. That means you can publish an ebook. If you have musical talent, you can upload and sell your music. Once it’s uploaded, you can sell that one product a million times. Not only is it perfectly legal, but your customers will all have gotten exactly what they wanted and what they paid for.
There are many, many more ways to develop passive incomes and we’ll go through the mechanics of developing them. The most important thing for now is to REALLY understand the reasons that you should never be satisfied with any income that isn’t passive.
Before we go on, it’s important to point out that passive incomes are not necessarily the ONLY way you should ever seek to earn an income. Developing good passive income streams requires many things, some that include experience, perhaps an education, and almost always capital to get started.
I’ve had a great career as a geologist that’s allowed me to see and experience things that I would have missed without a science degree. I’ve been involved in offshore oil exploration, drilled on the North Slope of Alaska where I watched the Aurora Borealis nearly touch the horizon, I’ve explored remote mountains for gold ore deposits, and been involved with Superfund and other environmental cleanups of bay sediments, soil, and groundwater.
Those were all great experiences. And all helped to contribute to my some passive income streams. If you’re passionate about a particular career path, pursue it zealously. The decision to pursue a degree in today’s rapidly changing economy is not an easy one, partly because not all colleges and universities are keeping up technologies, and partly because tuition and other costs are so high. This is a vital topic that we’ll explore later.
Here’s the third secret of passive incomes: they’re not necessarily EASY to develop, but everyone that I know that has them agrees that they are worth every effort and every inconvenience.
If you make up your mind now that you’d rather spend your time than sell it, and if you truly understand that no one can pay you what your life is worth, you will make developing passive incomes the top priority of your life.
Stay tuned as we pick some specific strategies and blueprints for making the transition to freedom. Our newsletter will give you insights, tips, and action steps for creating your passive income lifeline. Sign up now.