Is passive income real or just a myth?
Today's question is inspired by @Rodolphe's Tweet :)
What is your opinion on passive income? Can it be achieved? Has anyone here achieved it?
Or is it just a deceitful word used by people trying to sell you their expertise?
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Definitely not a myth and I have the data to prove it!
The effort I spend on my businesses is to grow them, not to sustain them. It's not purely passive if you have to do a bit of support, but your ROI for an hour of time can drift towards the thousands of dollars or more if you design them correctly.
Granted, it'd definitely possible things could dry up in the future if I stopped working on them, but it's certainly not inevitable.
Of course passive income can be achieved, but afaik no (or not a lot of) Indie Hackers are striving for it.
There are entirely different communities dedicated to passive income and financial independence. It's all about generating that first cashflow, independent from input (e.g. setting up blogs with evergreen niche affiliate content, selling highly popular Udemy courses, or writing a lot of niche books) and then investing that income into stocks, bonds, real estate etc. and living off the returns.
I'm yet to see a bigger amount of IndieHackers trying to achieve this. We are looking to build independent businesses that support us and our passions, it's a different thing. Creating affiliate content is no fun, building a business is, but the two can co-exist.
Just build a robot to pedal for you, and now you have passive income :) The question now is, how do we build the robot to take control? Lots of automation of mundane processes, and hiring out the things that take the longest. I believe there are levels of passive income. Dividend stocks being the most passive, real estate a little less passive, and running a SaaS even less passive (but still passive if built correctly).
It also reminds me of this tweet by @sahil
"Things you can own:
Yes, you can achieve it. In my understanding, passive income mean any income that requires little to no effort to earn and maintain.
I invested my saving into my uncle business, and consistenly earning good amount income every month without doing anything.
Or if you have a business which running without you in everyday operation, you can call it pasive income
Of course it's real.
Being an indiehacker is all about passive income.
You build a product, work on it day & night, and while you're sleeping, or in the toilet taking your morning dump, or visiting your inlaws for the weekend, your product is at work. At the same time, it's earning you money by collecting reoccurring revenue.
SaaS models are all about maximizing reoccurring revenue.
That's called "momentum" though, meaning the passivity dries up after a while.
Either competition starts eating your lunch or the market moves on.
That's why they say you need to constantly pedal.
But that's not too bad honestly, especially if it offers you time and location independence.
I've heard of people working 10 hours a week, even less, making a good 6-figure income.
Is that passive? Mostly, but ultimately no.
Is that still fucking awesome? Hell yeah!
If you're asking if there is a job that is 100% literally hands off passive, yes of course. You can invest in dividend stocks, and that is literally 100% hands off passive.
I think if you are able to build your business in such a way, that makes it easy to automate a lot of the processes, then you can have a real passive income business.
Look at affiliate marketing.
Successful affiliate marketing sites are almost completely hands free. They employee writers to make the content, and traffic is mostly organic through SEO. Sure they may spend maybe 4 - 5 hours a week, to make sure their SEO is relevant but thats defintiely 100% passive income at that point.
I mean, if you're trying to say that spending just 4 - 5 hours a week on something that generates, lets say conservatively, 7k a month isn't 100% passive income, i dont know what you're really expecting.
Like I said, it's an awesome deal. We just can't call that "passive." It's more of a semantic discussion.
I'd love to be able to work 4-5 hours/week while making a great income. It's how the new rich lives.
Completely not working isn't how I envision my life anyhow. But drastically reducing my work hours while maintaining income, hell yeah.
I've been moving myself towards a 'business owner' of Ministry of Testing rather than working in the business. There is a team there now doing 99% of the work. Atm it requires minimal effort and I still get a monthly income from it.
Investing in other businesses can also pay off.
Property is another one that can be deemed as passive, but they still require some work. And sometimes they can be such a drain.
I'm not sure how it works elsewhere, in the UK putting money into your pension is often a wise and tax free option. You can also opt to put it into stocks/shares. This ends up 'paying your future self'. Not quite passive, but you may be thankful in the future.
A business is like a family ! Gotta take care and love it ! You can never go easy minded into a business thinking to get rich like they say in their advertisements with 21yo millionaires on their rolls royce cars, a business is always stable steady small steps but you can never obtain such huge success in short matter of time, that's just how life works. I personally like the internet idea business of selling apps, currently owning this site https://yourmoneygeek.com/selling-apps/ and it always asked consciously attitude to start getting profit from it.
Agree, growing a business is hard, but at the same time is very interesting. I think that this job is the most motivated one. I mean you see that you can invest and grow and you are trying different methods. It is really interesting. Now I would like to do the same. I found on the internet a blog about passive income https://themoneymix.com/passive-income-ideas/. There are a lot of ideas and real-life situations about how people started their small business and now they transformed it into a big one. I have to try something from there. I suggest you too!
"passive" can be defined in a number of different ways, depending on each person.
so, it might mean that someone has a project that effectively runs itself, outside of collecting payments and "checking in" on automated systems. a lot of dropshipping businesses are like this as well as white-label products.
but, you still have to do something to manage a business. operating one requires administration of taxes, finances, and much, much more. there's nothing passive about that... and even if you outsource or hire folks to do those things, well, now you're a manager.
the closest thing i've ever had to passive was a blog that required about 40 seconds a day to post one image. adsense took care of the rest. i had to spend a few minutes every month updating the site or any systems that were in place (checking google analytics and adsense revenue) but total commit per month was probably less than 2 hours.
that feels pretty passive to me... and definitely in comparison to how much time i'm spending on my startup now!
to a real degree, "passive" is pretty relative to each person's unique situation and the project that they are working on.
Of course it isn't a myth. It is my specialty!
Pennygen.com is devoted to it. Passive income sources from all types of methods, and a social platform to discuss tips and methods. From bandwidth rental to crypto mining pools, we've tried and tested it all.
And because so many of these methods have referral links, we blast the internet with ads. People get considerable ROI, depending on the referral. My personal favorite is CryptoBrowser. I get an annual ROI of 24%? Much better than starting a franchise.
Other users have other methods. But so many are using technology to passively generate income. Fascinating world!
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