The truth about “passive” income:
1. Passive income does not come from mealy building up a property portfolio or setting up some affiliate links to sell some Amazon products. Passive income only comes AFTER a tonne of hard work. The thought of money pouring in without you having to do anything is BS and not as real as some guru’s who sell you that idea make out.
2. Chasing passive income means you are trying to make money from work you don’t want to be doing. Think about that for a second. You want the least amount of involvement in your work.
People say they are passionate about property with only a few BTL properties because they can set it all up and just forget about it. That is not passion. When you’re passionate about something you want to do and be around the thing you are passionate about daily. Not set it up and then forget about it.
It then dawns on you after being sold the dream of passive income that, a few BTL’s are not really going to cover your lifestyle with its income. You would probably need 10-20 of them. So people look for the HMO route and let me fully assure you that managing HMO’s is a completely different beast. Which is NOT passive. Not to mention you would need substantial capital to invest in such due to refurbishments and requirements.
Anything that starts with “I don’t want to work to gain my money”, is a problem for you.
3. When it comes to property the valuation of the property IS passive. It goes up and goes down. However on average to see any big development of a valuation you typically would have to wait 10 years.
“Ah but Alex, what about London?” You’re right London would be shorter time frame from an increase valuation, however, the entry into a London Market is MUCH, MUCH higher. (I do not want to go into Brexit, but as an experienced investor myself, I am not personally investing right now).
4. When was the last time you bumped into someone who said to you they were travelling non -stop funded by their “passive” income? Yeah me neither!
“What about the YouTube Ads?!” Ah yes, the people who are selling you the dream of travelling funded by passive income who by definition aren’t receiving passive income themselves because they are selling you their courses.
Do not get sucked into the false reality. Passive income typically comes in these forms – The markets (Stocks Bonds), investing in start-up companies and property valuations: for you to see any significant return you’ll have to invest a lot or wait a long time.
5. False expectations can keep you broke and miserable.
Guru’s selling, you courses on how to get passive income makes the whole journey (and destination) much more miserable, because there is no system, no strategy or magical mentor who will show you how to produce passive income so you do not have to work for your money.
My advice is to get the idea of chasing and building passive income out of your mind, you will generally miss a lot of opportunities elsewhere in building an ACTUAL business that can give you an incredible lifestyle, that you can eventually systemise, but will not be completely passive.
There is a LOT of ‘process’ and hustle before any “passiveness” comes into play.