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Create wealth through Passive income

Posted by Francis Isberto | Labels: | Posted On Friday, January 1, 2010 at 7:29 PM




If you look at this picture it is asking you what will you do with your extra time if your passive income streams supplied all your family financial needs. There are a lot of things that will come to your mind like a long vacation where you can travel with your family on a paradise that you've been dreaming to visit once you had the time.
Or just simply hang-out with your wife, kids, friends, special someone all the time you want and let your passive income stream do the work for you.

So what is passive income? Passive income is a type of earning where it does not require direct involvement from you (owner/merchant). In other words your money does all the work which will free up your valuable time. This is a lot better from an active (earned) income where you normally work from 9-5 during the day, 5 days a week.

My advice to you, keep your job just to bring food on the table but start creating your passive income streams. It doesn't have to be huge.... start small and build more as you move along. In time your passive income will grow until you have the luxury to let go of your job, let your money work for you and spend your time to relax and have fun.

Do you want to have your own passive income? There are a lot of methods to do it. You can start with one.... one that your familiar with then move on to the next one once it is established.
Let's begin with the most familiar one.

BUSINESS:

This is always the advice of the experts, if you want to create wealth go into business. Employment is a good start just to satisfy your daily needs but is not enough. Business on the other hand will make your money grow.... maybe double to what you are earning.
The good thing about business is you don't have to leave your job giving you an extra income stream that will generate more income for you. You have income from your salary plus you get your earnings from your business.

Just remember to look after your business and be "hands-on" whenever you had the time. Hire someone that is trustworthy and reliable.
Ask around to some successful entrepreneurs and find what made their business prosperous. Research and attend seminars if you must. You can start at home and make your hobby or passion of yours into a money making machine.
This method is the most tried and proven one. If you have the an extra time during week-ends or a house-wife that has nothing to do I advice you should start with this method first.

REAL ESTATE:

Normally people will back away from this method knowing it requires an obscene amount of money to set it up. But you don't need to be an Ayala or an Henry Sy just to buy a property. Just remember the basics.... always start small. If you're an employee you can use your Pag-Ibig plan to avail an housing loan. Once Pag-Ibig has given you the funds acquire a house in the vicinity of the low-cost housing project (normally they are located in Cavite or Fairview). Don't worry about the monthly payments, get someone to rent your property and let your earnings pay the amortization.

This is where your money will work for you and your passive income comes in. You don't need to spend, work and give to much attention to it. In time your Pag-ibig loan will be fully paid and you will still get the benefits from the rental earnings plus you have an additional property (I assume you have a primary house).
Once you complete the Pag-ibig payments you can apply for another housing loan and add more earnings and properties. You can even ask small banks and lending institutions about housing loan and you can speed up your housing rental project by acquiring two properties at the same time. This is risky though and I suggest you start first with one unless you have somebody who is an expert in the real estate industry.

So there, that's all for now. Look up for my next blog "Create wealth through Passive income 2" for additional passive income streams.
In the meantime concentrate first on the two methods that I gave you and start building your passive income.

Remember Work Smarter, Not Harder!!

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