For example my business is a LLC taxed as a S corp. I am active in it and my wife is not. She owns half the company because she fronted the money to start the company (but is not active at all in the business). I get paid a W2 salary for my work I put into it and any profits are distributed to my Wife and I as “dividends”. However the dividends are still taxed as active income at the higher tax rates.
We have decided to invest in 2 ETFs, a multi asset allocation ETF (Fixed Inc, alts and div paying equities) and a preferred stock ETF. This will cover almost 45 percent of our deficit. We will be extremely diversified, can access the markets at a very low cost and the investments are liquid. On this pool of $, we have no plans to invade principal unless the investment grows by 20 percent, which we think is unlikely given the characteristics of the investments.
In fact, any type of digital artwork could be sold on Etsy. If you end up taking up photography, or you’re an aspiring photographer or professional one, you could also sell your photos through Etsy as digital downloads. From vintage artwork to photography and motivational prints, you could sell any number of style of digital-only products through Etsy.
I sold back in the mid 80s. We took a second from the guy who purchased it. He paid us 7% a year on the amount he borrowed. That was actually a good thing. In a couple years, he paid the loan off early but we had an early payment clause that paid us six months of interest. I invested the proceeds in the market which was hot at the time. So, that was good. It turned out to be a great investment. My only regret was for diversification purposes, and that guaranteed income stream. We had one section 8 tenant who kept the place spotless, and we could always count on the government to pay. Plus if I had a good tenant, I would keep the rents low but with section 8, it didn’t matter, the government paid most of the rent and increasing the rental didn’t affect the tenant that much.
Evergreen content, which is described as that SEO content which stays relevant for a long time after its initial publication, is a good way to generate income. Comprehensive research statistics and case studies, such as social media marketing trends for the last five years, and detailed how-to guides, such as a beginners guide to using Twitter for business, are always going to be sought after people who wouldn't mind paying small amounts for access to the information.

Anthony, nice setup! To your question about the rental mortgages, you haven’t said what interest rate you are paying. As a start, if you are paying more than the risk free rate (Treasury bills) which you probably are, then a true apples to apples comparison would be yes, pay off the mortgage. But, if you are comfortable taking more risk, you have other options to invest in which you *hope* will yield you more over the coming years. You also didn’t say whether the rentals generate net income and if so, how much? What is the implied rate of return on the equity you have invested in them? If you pay the mortgages off, you’ll have even more equity tied up, will the extra net income make that worthwhile? Maybe you should use the money to buy more rentals instead, if purchase opportunities still exist in your town. … this is less of an answer than a framework to analyze the decision, hope it is helpful.

However, you should pick a niche and blog about that. If you're launching a money related blog, maybe it'll be about how to make money in real estate or simply how to make money online. Pick the niche and stick to it. If it's a diet and fitness related blog, maybe the niche is the Ketogenic diet, the Atkins diet or some other form of diet or fitness.

In 2012, even I wrote a 150-page eBook about severance package negotiations that still regularly sells about ~35 copies a month at $85 each (2nd edition for 2017) without any effort. In order to generate $2,975 a month or $35,700 a year in passive income as I do now, I would need to invest $892,500 in something that generates a 4% yield! To earn $10,000 a year in passive income would therefore need roughly $250,000 in capital.
Accretion/dilution analysis Adjusted present value Associate company Business valuation Conglomerate discount Cost of capital Weighted average Discounted cash flow Economic value added Enterprise value Fairness opinion Financial modeling Free cash flow Free cash flow to equity Market value added Minority interest Modigliani–Miller theorem Net present value Pure play Real options Residual income Stock valuation Sum-of-the-parts analysis Tax shield Terminal value Valuation using multiples
With either of these sites, along with numerous others that exist and might exist in the future, you’ll also receive things like promotional tools and the ability to ship products worldwide without ever actually having to physically make or store a product ever. This is definitely a low-cost way to generate some passive income without all the hassles of running an online store.
You can find dividend stocks using Google Finance Stock Screener which is free to use. Set the search criteria for the P/E Ratio, and Dividend yield (shown as a percentage) criteria. You can set minimum and maximum values; in the dividend yield box, set it between 2 and 100. This will search for stocks that pay dividends worth between 2-100% of the current stock price.
I think you should use Financial Samurai to raise your passive income. You’ve already proven that you writing 3 articles a week is enough to not only sustain the site but grow it. Why not have more guest writers post articles? Since you started with the extra post each week I’m guessing traffic is above your normal growth rate. Leverage that up with more posts and my bet traffic will continue to grow.
Those who can reap the benefits of residual income have typically put in an immense amount of effort and time in the beginning to be able to enjoy the rewards later on. Residual income, therefore, does not result in instant gratification. Those interested in earning residual income must have a lot of patience and determination to work as hard as necessary to achieve their ultimate goals of a long-standing income stream.

DDM and FCFE models measure value by discounting a stream of expected cash flows. The residual income model starts with a book value and adds to this the present value of the expected stream of residual income. Theoretically, intrinsic value derived using expected dividends, expected free cash flow to equity, or book value plus expected residual income should be identical but this is rarely the case. It may be helpful though, to use a residual income model alongside a DDM or FCFE model to assess the consistency of results.
This one may seem simple, but that’s only because it is. If you were to move your savings from a traditional, brick-and-mortar bank with a low-interest rate and into a high-yield savings account online, over time you can make a surprising amount of extra cash. Online banks are FDIC-insured just like the traditional brick-and-mortar institutions, so your money is just as safe.
Varolo is an advertising campaign that allows major corporations (like Coca Cola, Lysol, and others) to reach their target audiences with a high return on investment. Major corporations are desperately trying to find new ways to advertise to people as the newspaper continues to decline in demand and in an age of DVR. Varolo is the newest opportunity that actually pays you, the one being advertised to, to watch their advertisements. You can join the campaign and earn a little extra spending money by viewing and rating commercials and even trailers for major motion pictures. While the trick is to devote 5 to 10 minutes of each day rating what you see, you should also be motivated to invite others along through Facebook, Twitter and other social media so that you can increase what you profit each week.
Why did P2P lending get a liquidity ranking of 6? It is quite possibly the most illiquid investment option you listed. You said you rank liquidity by “difficulty level of withdrawing your money without a massive penalty”, and for Lending Club notes, it’s not only difficult and extremely time consuming to sell all of your notes in their super illiquid market, but you would have to sell your notes at large losses to hope to get others interested in buying your notes. On top of that, it is impossible to withdraw your money any other way other than just waiting for interest/principal to pay off every month until maturity in 3 to 5 years. You can’t just one day tell Lending Club “I want to quit, please give me my money back.” One can even argue that it is less difficult to sell a home (in order to “withdraw” the money invested) than to withdraw all of their money from a P2P loan portfolio because it is very possible to sell a home before 3 to 5 years.

What spurred this blog post was an idea put forth by my friend at ESI Money in which he talks about how the first million is the hardest. ESI shares how his net worth growth has accelerated. The first million took 19 years of work (the clock starts when he started working, not at birth!) but the 2nd million took just 4 years and 9 months. J Money took this same idea and started at $100k, which took him 7yrs 11mos. Each of the next $100k milestones took close to 18 months each to reach.
Peer-to-peer lending means loaning money to other people. Specifically, you lend money to people who don’t qualify for traditional financing. Companies like Lending Club and Prosper offer returns in the range of 4-10%, which are a lot higher than a typical saving account. You will be able to select the right investment for you, based on your risk assessment strategy.
Evergreen content, which is described as that SEO content which stays relevant for a long time after its initial publication, is a good way to generate income. Comprehensive research statistics and case studies, such as social media marketing trends for the last five years, and detailed how-to guides, such as a beginners guide to using Twitter for business, are always going to be sought after people who wouldn't mind paying small amounts for access to the information.
If you need cash flow, and the dividend doesn’t meet your needs, sell a little appreciated stock. (or keep a CD ladder rolling and leave your stock alone). At the risk of repeating myself, whether you take cash out of your portfolio in the form of “rent”, dividend, interest, cap gain, laddered CD…., etc. The arithmetic doesn’t change. You are still taking cash out of your portfolio. I’m just pointing out that we shouldn’t let the tail wag the dog. IOW, the primary goal is to grow the long term value of your portfolio, after tax. Period. All other goals are secondary.
Depending on specialty, most of us can expect to be involved with a malpractice suit at least once in our career.  But what if you had 3 cases in the same year?  It is likely that you wouldn’t be able to continue to get malpractice coverage.  Or, if your malpractice is through a group, the insurance company may insist you be thrown out of the group or else the whole group’s rates will go up.  I know of at least one doc who was recently let go partly at the insistence of the malpractice insurance company.  Think your disability policy will cover this?  Think again.
There was a time when CDs would produce a respectable 4%+ yield. Nowadays, you’ll be lucky to find a 5-7 year CD that provides anything above 2.5% The great thing about CDs is that there are no income or net worth minimums to invest, unlike many alternative investments, which require investors to be accredited. Anybody can go to their local bank and open up a CD of their desired duration. Furthermore, a CD is FDIC insured for up to $250,000 per individual, and $500,000 per joint account.
Do your due diligence and sign up to other relevant courses that you might find on that site or any other site out there. Go through those courses and build a curriculum that makes sense for your own course. Ensure that you take the time to do this the right way and that you don’t just try to slap something together. Remember, this is years and years worth of potential passive income here, so invest the right amount of time into this.
Reality One: We live in a competitive and fast changing world. Business has become highly specialized and niched because knowledge is growing exponentially, requiring specialized skills to employ it properly. Successfully competing in many widely varying fields is contradictory to the specialization and complexity required by our current business climate.
That strategy seems waaaayyyy less risky than actively picking stocks of supposedly “reliable” stocks that issue dividends, which could be cut at any time due to shifting industry trends and company performance. Dividend investing feels like an overly complex old-school way of investing that doesn’t have a very strong intellectual basis compared to index investing.
ABC International has invested $1 million in the assets assigned to its Idaho subsidiary. As an investment center, the facility is judged based on its return on invested funds. The subsidiary must meet an annual return on investment target of 12%. In its most recent accounting period, Idaho has generated net income of $180,000. The return can be measured in two ways:
This is a fairly new concept to me still, but I now see that multiple streams of income are definitely far better than one high income stream as you point out. I now work part time as a hospitalist. That job provides our biggest income stream, but I also work part time for an opioid treatment center, which could easily turn into a full time position if I ever needed it (the owner has told me “you always have a job here”). Additionally, my wife works full time AND she runs an airbnb room out of our home which pulls in easily 1000/month. Those combined with our investments in stocks/bonds give us 5 sources of income. In the past we relied solely on my full time work and it stressed me out knowing that at any time something could happen that could take that away from us (as you listed above). Since I started doing these other things and we diversified our income, I feel much more at ease and relaxed.
If you’re considering real estate for your portfolio, let me give you some advice: Don’t jump in without a ton of research. It’s not as easy as they make it look on shows like Flip or Flop. There’s a lot that goes into becoming a successful landlord or flipping houses for a profit. Plus, a lot can go wrong and your mistakes can eat up your profits quickly.
3. Rent - Being a landlord is fabulous. You get rent for the rest of your life on the asset that you have created. This type of income also can grow if your property is good, well maintained. The growing income is a hedge against inflation. If you can earn rent to pay for your living expenses every month, you can be very close to achieving financial freedom!

What’s also really important to realize here is that when I took the exam I was teaching people to study for, I didn’t get a perfect score. In fact, I didn’t even get close to a perfect score. I passed. But I also knew a lot about this exam—way more than somebody who was just getting started diving into studying for it. And it was because of that, because I was just a few steps ahead of them, that they trusted me to help them with that information. To support this, I provided a lot of great free value to help them along the way. I engaged in conversations and interacted in comments sections and on forums. Most of all, I just really cared about those people, because I struggled big-time with that exam myself.

Whether you choose to invest in just one of these modern REITs or both, keep in mind that since they’re private funds and not stocks, you won’t be able to easily liquidate your investment and access your cash right away. Depending on your investment, plan to see your money tied up for anywhere from six months to five years. However, you’ll most likely still receive monthly or quarterly payments, depending on which investment opportunity you select.
You say that you’re cautious with REITs due to the headwind caused by the rising interest rates. I’m with you, but at the same time earlier you said that you don’t expect the 10yrs yield to go over 3% for a long time. Now we’re nearly there. Does it mean that REITs become more attractive for you (like I see it), or you’re still cautious for some reason?

However, not all of us use the time that we have wisely. In fact, we often squander it. We waste time with trivial pursuits, enthralled in things that don’t help to advance us towards our goals, or steeped in one bad habit after another, wallowing in self-pity and lamenting that there simply isn’t enough time in the day. In fact, you can tell a lot about a person by the way they use their time.
The legendary investor, Warren Buffett rightly said that if you cannot create a second source of income by the age of 45, then you have really done injustice to yourself. If you are in business or if you are an independent consultant there are multiple streams that you can consider. But what if you are employed and your existing contract does not allow you to take up other work? Also, your pressures at your workplace may be tight enough to leave you with little spare time to worry about how to create a second stream of income. That is when you have to make money work hard for you. Let us look at two such approaches.
One of the easiest ways to get exposure to dividend stocks is to buy ETFs like DVY, VYM, and NOBL or index funds. You can also pay an algorithmic advisor like Wealthfront to automatically invest your money for you at a low fee. In the long run, it is very hard to outperform any index, therefore, the key is to pay the lowest fees possible while being invested in the market. Wealthfront charges $0 in fees for the first $15,000 and only 0.25% for any money over $10,000. Invest your idle money cheaply, instead of letting it lose purchasing power due to inflation. The key is to invest regularly.
I am almost 50 years old and have invested during the dot.com and the 08/09 bear markets. I spent over a decade having my portfolio stay the same as what I had put in originally. At this stage I am fine with more fixed income and I also keep my extra properties empty or allow my adult kids to live there. I really enjoy using my assets to do some good for those I care about. I probably get more joy from that than just seeing the net worth build up.
Once you’ve been approved and sent your products to Amazon, simply sit back and allow them to be sold. You never have to deal with fulfillment, shipping or customers service whatsoever. All you need to do is get your products to Amazon and collect your payments. This is mostly passive, but does involve some input of your time along the way once things have been configure.
Well, the number seven may not be magical, but it does seem these concepts are two sides of the same coin. Yes, the streams may eventually make the millionaire, but it’s also true that the millionaire understands the importance of multiple income streams–without them, after all, he or she may never have broken the million dollar mark. So, he or she continues to increase their streams of income.
If you have specialized knowledge in a certain topic, you can put together an online course to teach others. For example, if you have experience in real estate investing, you can create an online course “Real Estate Investing 101”. The benefit of an online course is that once you create the course material, you can sell it to as many people as you want.
This world is a dangerous place to live, not because of the good people that often act in irrational and/or criminally wrongdoing ways within the confines of their individual minds, core or enterprise groups, but because of the good people that don’t do anything about it (like reveal the truth through education like Financial Samauri is doing!). Albert Einstein and Art Kleiner’s “Who Really Matters.”
Now, all that said, if capital (savings) grows faster than the growth of the economy, those with savings will see their wealth grow at a faster rate than those who rely on the growth of their income. While this is not an extension of Piketty's argument (you can't take an idea that applies to a population and a whole economy and boil it down to the individual like this), it's not an unreasonable conclusion to take and apply to your own life. (Piketty does talk about this on an individual level, but says it's more impactful for billionaires vs. millionaires – though we have limited data into individuals)
Many people in the investment world also define residual income as revenue stemming from a passive source. This revenue is created without a direct input of effort or time. The investment itself creates addition revenues without having to be managed. Some examples include royalties, dividends, interest, and rent. Take a dividend stock for example. Once the money is invested once, it will keep producing a dividend every year without having to input additional time or resources. This concept is the Holy Grail for most investors.

What spurred this blog post was an idea put forth by my friend at ESI Money in which he talks about how the first million is the hardest. ESI shares how his net worth growth has accelerated. The first million took 19 years of work (the clock starts when he started working, not at birth!) but the 2nd million took just 4 years and 9 months. J Money took this same idea and started at $100k, which took him 7yrs 11mos. Each of the next $100k milestones took close to 18 months each to reach.
3. Rent - Being a landlord is fabulous. You get rent for the rest of your life on the asset that you have created. This type of income also can grow if your property is good, well maintained. The growing income is a hedge against inflation. If you can earn rent to pay for your living expenses every month, you can be very close to achieving financial freedom!

Real Estate Income – Since we moved up to Newport Beach, I started renting out my condo in San Diego. My monthly cash on cash return is $300(I charge $1,900 for rent and my total payments including mortgage, HOA, property tax and insurance are $1,600) but I also get back around $350 every month in principal and about a $150 tax savings per month. But even this income is inconsistent, since sometimes expenses will pop up like last month when I had to buy a new A/C for $3,000!
Roofstock – Investing in rental properties is one of those passive income ideas that can be extremely intimidating, especially when it comes to finding tenants. Roofstock lets you buy properties with as little as 20% down that already have tenants living in them. That means you start getting paid from the first day of your investment. You don’t even have to physically visit the properties!

Build an investment portfolio that pays out dividends (Stocks / Bonds / Mutual Funds). Dividends are payouts that companies give to their investors as a portion of their earnings. They’re often paid out quarterly. If you’ve already got an investment portfolio, it’s time to take a good look at which stocks, bonds, or mutual funds you own. You’ll see consistent returns from the ones that pay dividends. This is a fantastic way to earn passive income. Invest once and watch the returns pile up.
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