When most people talk about income, they’re talking about the most basic type of income. That is, time in = actively earned income. This is obvious, because most of us have day jobs where we’re essentially paid for time & effort. That’s the way it works.
For most of us, if you want to increase your income, you usually have to put in more time. Either that, or find a job that will pay you more per hour or for the physicians out there, do what reimburses you the best. We spend tons of time trying to figure out how to gain a promotion, find another job that will pay us more, or rearrange our schedules so we can get some overtime.
It’s my belief that this system of increasing income is simply not efficient. Instead of focusing on how we can work more or work harder, shouldn’t we be focusing on how to leverage our time better? After all, time is our most valuable resource. What good is money if it can’t buy us time to do the things we love with the people we love?
We should be focusing more energy and time on acquiring passive income.
Now, I understand that the idea of putting more time and effort into passively generating income may sound counterintuitive. After all, isn’t passive income is supposed to be “passive” and not demanding of time or effort?
Well, the reality is that it does take both time and effort to figure out how to make passive income–at least initially. However, once that engine is running, you’ll find that your income far exceeds the time and energy you put into acquiring it.
With passive means of income, you’re able to work smarter and possibly produce greater output (earned income). For example, if you invest wisely, it’s very possible to essentially make money while your sleep. More examples of this type of income include money earned from rental property, dividends from investment, royalties, and more. For a better list, see 10 Perfect Passive Income Ideas for Physicians.
If you’re considering adding some passive income to your finances, it helps to get the ball rolling with some ideas. Those streams aren’t going to just appear out of nowhere. So what are some ways you could spend time on acquiring more passive income? Here’s what you need to do.
Read. Start by figuring out what’s out there. I’ve tried to list out a few here and here, but my lists are by no means comprehensive. Make sure to read blogs, books, and even listen to podcasts (it counts).
Think about what might work for you and your family. Every passive income venture isn’t right for every person. Consider your current financial situation as well as your priorities. Also, think about how striving for financial freedom can ultimately impact your life for the better.
Talk to people about it–as many people about it as you can. Who’s actually out there doing it? Who do you work with that seems like they’ve figured it out? How have they succeeded? Don’t be afraid to ask other successful people what their secret is. Even a casual form of mentorship can be immensely valuable.
Move. Don’t be afraid to go to seminars & investment meetings. Yes, some of them are cleverly disguised as sales pitches, but certain seminars are able to give you 20-30 years of experience and wisdom packed into just one or two days. They can be well worth the investment. If nothing else, they’ll get your gears turning.
When it comes down to it, there’s no denying that the old model of income works. You make more money, but at what cost? Are you willing to go on sacrificing time and energy for a little more cash? Or will you take the steps to securing your freedom, both in time and finances? Take a few small steps like the ones listed here, and you’ll be well on your way.
What do you think? Are you making the move to transitioning more of your income to passive? What steps are you taking?