Table of Content
- 1 What is Passive Income And How Anyone Can Create It
- 2 Can Passive Income Easily Be Earned?
- 3 Difference Between Income And Income Sources
- 4 What Is A Separate Income Source?
- 5 Active Income Source –
- 6 Passive Income Source –
- 7 Portfolio Income Source –
- 8 Types of Passive Income
- 9 10 Example of Passive Income –
What is Passive Income And How Anyone Can Create It
Passive income is income, for which you do not have to work actively, as a rental income from a house is your passive income because you do not work actively for rental income.
Passive income is also called income when you do not work for money, but money works for you,
For example – Interest from bank fixed deposits, or dividends from stock, or income from such business that you do not actively work on.
Can Passive Income Easily Be Earned?
Creating passive income source can take a lot of time, and generally, if you have no pre-existing assets from which you can get regular passive income, you may find it necessary to create a new passive-income source,
And anyway, people do not pay much attention to passive income because for a new man it takes a lot of time to create a new source of passive income.
It can be said that earning money from a job like active income is quite easy, but to earn income from passive income, you have to make such a property first and it can take a lot of time to make a monopoly and mostly creating a new monopoly for the people is quite a work of musk.
Difference Between Income And Income Sources
- There is a special difference in income and income sources,
- In the income source, we get income on fixed time intervals continuously,
- While income can be any amount, whatever comes from ours,
- Like, the money win in the lottery winnings can be our income, but not an income source.
- The money from the job is our income source.
What Is A Separate Income Source?
Let us also understand the income source, well enough to understand passive income,
We need money for our living, and all kinds of expenses, and we all have some sources of income, and from the source we make money is called active income.
Like – If I have money in my job as a salary, salary is my income source, and in the same way, if someone receives income from the house, then the rent is his income source.
Well, there can be millions of ways to earn money, but if you talk about your income source, the way you earn money, there are three types of income sources.
Active Income Source –
As is known by name active income, which means that we have to work actively to get the income, this is called an active income.
Passive Income Source –
As we have already said that Passive income is income, for which you do not have to work actively, for example, rental income.
Portfolio Income Source –
Portfolio Income is a part of Passive Income, which comes from income sources such as banks and stock investments. This such income is called portfolio income. Like dividend, portfolio income, which comes from stock investment.
So far, we have understood that whatever we are, employees, businessmen, daily workers, housewife, students, children or old age, whatever the income we generate has come from only these 3 sources.
Types of Passive Income
10 Example of Passive Income –
- Income from Rent,
- The benefit of interest from fixed deposits (Income from fixed deposit)
- Benefits from Mutual Fund Deposit, (Income from dividends and capital gain)
- Dividend from Stock Investments (Income from dividends)
- Income from any business you do not work actively – like Partnership Business.
- Income from pension plans
- And, Income from royalty received from writing a book
- Income from any type of internet business, (Income from websites/ blogs/ youtube)
- Capital gain from Value Stock Investing, (Income from value investing in stocks)
- Commission income from MLM or other such company who give commission.