Passive income is earning recurring income with little (or no) effort required to maintain it. Passive income is freedom from a 9-5 job. Passive income is making money while you sleep. Passive income sounds too good to be true. Let everyone else think that.
Although it's possible to earn a living from passive income, sometimes I make it sound too easy. It can be easy but I work more now than ever. If you want to stay ahead, you'll be working more than anyone you know. Keeping up a passive income of $100s of thousands per year is a full-time (but extremely fun) job.
1) Passive income = Easy income. Wrong. Developing an app or similar product can be stressful and time consuming. Even though you're outsourcing the work, coordinating team members and getting past Apple is a huge job. (Okay, eBooks can be easy once you figure out the process!)
2) Your first product will be a hit and you can retire on an island. WRONG! Keep reading...
1) Your first attempt won't be a huge success. My first app took months to develop, only to be removed by Disney after 2 weeks.
2) Once you make some passive income you'll want to earn a little more, and a bit more, then A LOT more! It's addictive!
3) You can work from anywhere in the world with an internet connection. I can be just as effective in New Jersey, Switzerland, or on the beach. Unfortunately I can't work while hang gliding though.
4) Your first passive income stream will likely disappear.
5) You'll have success through creating a diverse portfolio of products in a variety of highly targeted niches. You'll want to remember this.
6) Through small failures (hopefully fast failures), you'll gain specific knowledge which will positively inform your future decisions.
How I Earn Most of My Passive Income
eBooks: In just 6 months I've built a 6-figure eBook publishing business. I use the same outsourcing model as with apps. eBooks are interesting because you can publish for free on Amazon with minimal development costs. If I were to start over, I would start with eBooks. You can make 10+ eBooks for the cost of 1 app.
Diversify your Passive Income Streams
My plan was always to only develop apps. That may be possible but I've doubled my income over the past year through diversification. Diversification works to your advantage in two ways. First, it boosts your total income (always good!). Second, when one income stream 'dries up', you'll have something waiting to supplement or replace it.
Here's how I've diversified over the past year:
- Variety of topics and niches
- Kindle eBooks and Apple iBooks
- Equity and profit-sharing in app/tech companies
The reason I posted this is because I think that everyone (especially students) should give passive income a try. There are so few barriers to entry, especially in creating eBooks. Don't be too discouraged when your first (or 2nd, 3rd, and 4th) ideas don't work. Although I lost $20,000+ on HUGE failures, I learned things that will earn me more than $100,000 in the future.
For Those Starting A New Business, Quitting Your Job, Dropping out of School
I constantly get emails from people who are inspired to either start a business, make passive income, quit their job, or even drop out of school. That's why I post and give out free info in the first place but let me say one thing. I didn't decide to drop out of school until I was making $200,000 per year. I'm EXTREMELY happy that people are inspired, but be careful of how much you're relying on passive income before you make it. While I'm against the higher education system, I don't recommend dropping out until you're confident and ready to devote most of your time to your business.
Feel free to ask me any questions.