How to generate 5 sources of passive income ?
Do you want to retire with a wholesome amount of money in your 40's or maybe early 50's? No B*ll shit, No MLM(I have started hating this word). Simple things in your financial life, if organized, can give you that freedom.
Do you think that you can have discipline and work towards your goal without excuses, then you can generate 5–6 or whatever number of income sources (passive ones) starting off in your 20s.
My Secret: I started investing in mutual funds and even a small amount in recurring deposits when I was 16 years old.
I am 24 right now. I can pay for my MBA (in India) education. Got the point?
Let’s cut the crap and dive into the 5 passive sources of money you can generate.
1. Be the expert in your day job.
A lot of hustlers will tell you to do a side job and earn more money. I say “Why not be the expert in your day job & get a double promotion in 6 months!”
Don’t think so its possible? Start learning one skill that is with few people in your industry and the world will want you.
Check these: Linked-in Learning (25$/month), edx (freemium), Coursera(<100$)& Udemy (5–10$/course)
2. Save less, Invest more (Invest in Mutual funds from today)
Don’t work alone!Let the money work for you. Invest in ELSS, SIPs for long-term goals.
Tip: I would never recommend doing Intra-day stock buying and selling. You want to play risky, take blue-chip equity stocks and keep them for next 5 years.(Play the risk for a longer period.)
I can not emphasize more on why you should have a financial plan ready in your mid 20’s. This helps in tackling short, long-term goals & financial emergencies.
3. Generate rental from real estate
A majority of the people think that real estate is dead.
I don’t agree with the statement. It depends on where, when and how much are you investing in a real estate. It also depends on whether its a commercial or residential entity.
Your real estate investment need not be in Top cities, Tourist destinations!
To give you more idea, my father invested in a land in 2010 for a sum of $24,000. The land is nearby our hometown and was a far away from central part of the town. The land was untouched for 8 long years. Nothing was done on the land and it’s a non-agricultural land. Its current valuation is close to $180,000. Staggering 8x growth!
Why?
Because a lot of government infrastructure projects have shifted over there and the land is now in demand like anything.
Alternatively, my dad invested in a real estate inside a major city in India (You can call the area as the heart of the city) for a sum of $100,000, 5 years ago. Its current valuation stands somewhere around $115,000 cause the market hasn’t grown in that part of the city.
The point is your objective while buying real estate should be very clear. Are you taking this for investing or you want to move-in there? Don’t mix them up.
4. Never buy things, rent them.
Majority of mid-high earning 20’s youngsters start taking housing, car or even personal loans and that burns a big hole in their savings every month. When you start deviating your money to things which do not add value to your skills, you actually reduce your chances of net increased monthly salary.
What do I mean by that?
A typical mid 20’s guy/girl has a monthly salary of around 3000–4000$(US) or ~40,000 (India).
There are 3 types of spending that happens out of this money- 1. You pay your loans 2. You buy things 3. You buy things on a repetitive basis. For e.g. furniture.
Why do that?
Start renting things which you are anyways going to throw away.Check out this platform which is like a Savings king for me.
5. Start a food franchise business
Now this may sound ridiculous but don’t invest in franchise just because you can.
You should have 3 things in place before taking a franchise-
1. Manpower
2. Sound knowledge about the industry ?(for e.g. food business)
3. Loss appetite
Checkout out this blog to learn more about how to run a franchise business on the side. Here
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