Passive income

economic-dictionary

Passive income is those that are obtained on a regular basis, without the need to allocate time and attention permanently.

Passive income, in other words, is those that offer a periodic inflow of money. However, they do not require regular dedication in return, such as that required by a full-time job.

The foregoing, it should be clarified, does not mean that a passive income does not need a previous investment, but that this corresponds to an initial capital that will not require, later, other frequent outflows of money.

Also, a passive income does not require permanent attention, but this does not mean that the investor can neglect it entirely. A minimum level of maintenance or vigilance will always be necessary.

Another characteristic of passive income is that it is usually complementary to the person's main activity. For example, an individual can work as a salaried employee in a company, but, at the same time, have an alternative income by renting a premises.

This type of income, in addition, not only requires initial capital and an effort to boost them and, later, let it go, but they need creativity and ingenuity. It is not so easy to identify opportunities that can generate passive income in a sustainable way.

Another point to mention is that this type of income can be useful for those who are retiring. In this way, even if they stop working and even access a pension, they receive an extra income.

Examples of passive income

Some examples of passive income are:

  • Leasing of a property: Through which the owner of the property receives a monthly income.
  • Investment in a security, such as the share of a company, in the stock market: The value of said asset will vary depending on various factors, and may, on occasions, provide dividends to its owner (the shareholder).
  • Creation of a YouTube channel: Through which, the owner can receive income, always depending on the number of views of the videos. It is not always a great source of income, but it can supplement an individual's income, as well as give them greater visibility.
  • Create a digital book (or ebook) or other digital product (such as a course): Which can be sold through educational or electronic commerce platforms on the Internet.
  • Place capital in the business of a close relative: In this sense, receiving profits in return, depending on how the company is operating.

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