A question that is often asked online: what is passive income? The passive income definition is a simple one. However, the definition and what it actually means are two very different things. This post will explain the definition of passive income, dive deep into the actual meaning, show an example of passive income, and explain how to start earning passive income as soon as today. Please keep reading.
The definition of passive income is money made over time after an initial effort to make money. Sounds weird, right? The opposite of this is active income, or money made directly from the number of hours you are paid to do a task. Most of us hard-working people report to a job that pays an hourly wage. If we do not show up to that job, we are not paid. Simple as that. Again, this is active income. Passive income is paid for work we once did, and is continually paid even if we never do it again. So, how can this be?
There are many industries that people can be a part of that are built on passive income. An example of passive income would be the efforts of recording artist Drake. He and the people who work with him spend months recording his latest album. It is a onetime effort, although it takes months to do. It is a lot of work to record and release an album, let’s be honest. I’m sure it is a lot of fun as well, but it is work. The album is completed and released, and based on his current popularity, he and his team immediately make millions.
Example of Passive Income
Obviously, right now Drake makes money anytime a person purchases his music online. In 30 years, Drake will make money from those same songs when a person purchases his music online. He does not have to remake the songs. He already put in all the effort and work today. But down the road his songs still has value to people, so they purchase it. And he receives passive income from work he put in years ago.
That said, Drake can still make active income by going on tour 30 years from now (imagine that). He would receive a likely handsome paycheck each time he takes the stage and entertain those who love him. It’s an option, but he does not have to do it. In 30 years it is something he is doing for fun. Drake’s main income will continue to be passive income from the work that he put in prior.
Not all of us can be Drake (just me), but anyone could earn and benefit from passive income. The Drake example of passive income is linked to the industry he is in. It is setup that way for music and the arts. But what if you are a teacher, police officer, clerk, college student, or just at home sitting on a couch in your mom’s basement. Can you create something valuable today that will still be valuable in 30 years? Guess what? Yes! And I will suggest to you how.
Passive Income Meaning : Profits
But first let’s talk about what passive income actually means. Earning passive income is a change in your life, finances, and outcomes. It is not a get rich overnight scheme. Nor will it take 30 years. But with the right efforts, you could be off your mother’s couch. Or you could travel, shop, play, and pamper yourself like you want to because you have extra money on a consistent basis.
Passive income meaning profits. The definition of passive income extends beyond what is in a textbook. It is a different mentality about your potential to have the type of life that you want. Active income in your job right now is fine, but let me explain how you can add to that income slowly. And hopefully, one day be making more passive than active income.
Affiliate marketing is one the easiest ways to earn passive income online. Let me explain. Maybe your talent isn’t music as with Drake. Maybe it’s working with pets, or playing video games, or something like programming? We all have something that we are great at doing. And if you do not think you do, read our blog post about finding your passions. Trust me, you do. And if you can explain how to do what you are good at to someone else, then you are a perfect match to affiliate marketing and the passive income it brings. If you have not heard of affiliate marketing before, read our blog post, Earn Money Affiliate Marketing. Otherwise, read on for a simple step by step formula you can use.
Starting A Passive Income
Blog Or Website
If you are ready to jump in to earning passive income, keep reading. Here are 10 steps you can take to effectively earn money passively.
- Identify what you are great at, and why. Remember, something specific.
- Start a blog or website related to this talent with a specific twist to it. If you are great with pets, but you really mean you are great with dogs, and you really mean that you are great with small dogs, and not the large vicious ones, then you have a specific topic for a blog or website. An example would be Caring for Small Dog. This is referred to as a niche. Starting a blog or website is extreme cheap these days and you can do that by clicking the Bluehost banner above. Bluehost is super cheap, extremely reliable hosting service. We use it on this site and love it. And, WordPress is setup on it in a click of a button.
- Next, find affiliate marketers in your niche. There are companies such as Commission Junction, ClickBank, and ShareAsale that work with companies looking for people like you to advertise their products. And you get paid passive income when their products sell. Sign up, and use their links to advertise for others.
- Write valuable content about what you are great at for others to read. Include links to the products and services that you are marketing for, and watch your passive income start to pour in over time.
- If you need help, sign up for a course that will hold your hand through the process. You can do that here. It is incredibly effective.
There is very little more satisfying than earning passive income day over day. From the example of passive income you can see that the definition of passive income is very broad. It can change your very existence. Remember, passive income meaning : profits is our goal. Take a leap of faith, and do yourself and those that you love the favor of giving this a try. Like Drake, the work you are doing now will pay off for years. It takes some effort to start, but once you venture into affiliate marketing it is hard to turn back.
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