Please note: The information provided in this blog post (The Power of Passive Income : Unlock Financial Freedom) is for educational and informational purposes only. It is not intended as financial, investment, or professional advice. Always conduct your own research and consult with a qualified financial advisor /subject matter expert (SME) before making any investment decisions. The author and website are not responsible for any financial loss or damages resulting from the use of this information.
Are you struggling to earn Money? Do you have sufficient Money but running short of Time? Or you are struggling for both Money and Time? Well, it happens because everyone of us has got limited time (24 hours) in a day. Then what rich people do differently that we are not doing? They make their money work for them. They multiply their money by investing in some business opportunities or they start their own business and multiply by their time by employing people. So, in a nutshell, if we want to achieve Financial Freedom and Time Freedom, we will have to increase our earning capacity and multiply our time by generating multiple streams of income.
Before we explore the question of “How?” let’s begin by asking ourselves “WHY?” See the below image and you will get you answer. Many of us don’t have money in our young age but do have time and energy. When we start earning we do have money and energy but sacrifice our time. When we get old, we do have time and money but may not have energy to enjoy life by using money that we have earned. Hence it is necessary to be healthy and wealthy at the same time.
Now as our “WHY?” is clear. Let’s delve into understanding “HOW?”
First and foremost, there is absolutely no need to stop what you are doing currently. Keep doing what you are doing and build other stream of income in parallel also known as “Passive Income”. This passive income will help you in achieving both “Financial and Time freedom”. Let’s understand what all things you can do.
Investments
There is a plethora of instruments you can invest in. Before you invest ask yourself a question, “do I really understand how it works”? If the answer is “yes”, then you can think further, else stop there itself. There are 4 important aspects to look at while taking any investing decision.
1. Risk appetite
Ask yourself this question, “how much risk I am willing to take?”. “What will be the impact if I loose the money?” Most of the youngsters lose money because they invest in instruments which has very high-risk involved such as Ponzi schemes/get rich quick schemes (schemes which promises unrealistic returns). It is necessary to be mindful before taking investing your hard earned money.
2. Interest rate (profit on principal amount)
What is the percentage of per annum interest I am getting? and is beating the inflation rate? e.g. Although investing in Fixed Deposit (FD) is a safe bet, the interest rate FD offers, doesn’t beat the inflation. Moreover we have to pay tax on interest. So, it’s as good as eating our own money.
3. Liquidity
I should be able to get the money when I need, immediately without any hassles. Although Real Estate offers comparatively higher returns, it doesn’t offer liquidity as it may take time to sell the property.
4. Money management
“Never put all eggs in one basket.” Diversify your portfolio. Plan your investments as per your needs and categorize them in short term, medium term, and long term investments.
Real Estate
Everybody might not have multiple properties. If you have more than one property, you may rent out the property to earn additional income.
Side Hustle
Start a side hustle such as doing a freelance work, consulting or be a content creator. Alternatively, you can start a blog, create your YouTube channel, do affiliate marketing, sell your products online.
As we have now explored what all options we have, we will now delve into details in upcoming blog articles. Until then, stay tuned! 😊