Introduction to Earning Passive Income
So if you’ve got a dream of being able to earn a passive source of income where you’re able to travel anywhere that you want, live in any country that you want, and just live a life of pure freedom where you’re able to make money 24/7, you’ve clicked on the right article. What I want to do is explain how I’ve been able to build up my passive income streams to the point where I’m earning over $40,000 per month.
Overview of Passive Income Streams
At the moment, I’ve got around seven different passive income streams, and I’m going to go through each one. My goal with this article is that, by the end of it, you’re going to know exactly what a passive income is, and you’re also going to know the steps you need to take to secure your financial future. But let’s not waste any more time; let’s jump straight into one of the first ones that all of you guys should be doing ASAP, which is simple savings accounts.
Importance of Savings Accounts
One common mistake I’ve seen with so many people is that when they get paid from their 9-to-5 job, their online business, or whatever it is, they keep their money in a standard current account that’s not earning any interest. Now, the way I like to do things is to put my money in savings accounts that earn me between 2 to 5% interest. If I can earn more, that’s great, but ideally, I look out for 2 to 5%.
Benefits of Interest-Earning Accounts
With this passive income stream, the more money you have, the more you’re going to be able to make, but this is definitely something you need to consider when it comes to making money on your money today, tomorrow, and in the future as well. Moving on to one of my second passive income streams: credit card points.
Earning with Credit Card Points
With credit card points, I wasn’t going to include it in this video, but I felt it was important for you guys to know. When it comes to various credit cards, spending money on them can earn you points back that you can redeem on whatever you want. A lot of you might think you can only redeem credit card points on flights, but that isn’t true.
Redeeming Points for Business and Personal Expenses
For me, I redeem credit card points through personal and business credit cards. I’ve got personal credit cards and business credit cards; for example, here, I’ve got three different gold American Express credit cards for three different businesses I’m operating. This is helpful because I’m always spending money on marketing, employees, and general business expenses, and I’m able to earn money in the process.
Maximizing Points for Personal Expenses
The same goes for personal expenses. Anytime I go grocery shopping, pay for fuel in my car, or whatever it is, I always use credit cards that allow me to get points back. Over time, as you do this day after day, week after week, month after month, year after year, you’ll build up hundreds of thousands of points that can save you thousands of dollars on purchases.
Tip for Using Credit Cards Wisely
One tip for any credit card you’re thinking about getting is to have the mindset of paying the money back within the time frame needed, so you don’t get charged interest. Anytime I talk about taking out a credit card, it’s not because you’ll borrow money, use it, and pay it back next year; you’re going to pay it back instantly. The credit card is only there as a way for you to earn points.
Digital Products as a Passive Income Stream
Swiftly moving on to my next passive income stream, which contributes to me making over $40,000 per month: digital products. At the moment, I’m selling 10 different digital products online in a variety of ways. I like digital products because, once you build it and put it up for sale, you can keep selling it. It’s more or less 100% profit, and you don’t need to fulfill it; everything is done automatically.
Building Digital Products for Long-Term Profit
Of course, there’s going to be work required upfront when building your digital product, but once you’ve done it, you can earn a passive income. Some of the digital products I’m selling right now include online courses, e-books, spreadsheets, and website themes.
Earning with Investment Apps and Index Funds
Another passive income stream I want to talk about is with investment apps. I’m using investment apps to earn a passive income by buying into index funds. Now, index fund investing is part of stock market investing. Instead of buying individual companies, you’re buying into a group of companies at one time.
Automating Investments for Passive Income
Now, the only thing I’ve had to do is make sure I set up the apps and all the automations. Everything else, I didn’t need to do, and I’ve been able to earn thousands of dollars in passive income without much effort. To give you an idea of how much you can make by consistently buying into index funds, I’ll log into a couple of investment apps I personally use.
Trading 212 Portfolio Example
One app I use is called Trading 212. In this app, as you can see, I’ve got a balance of around £44,000, which is around $60,000, and the profit I’ve earned is around £7,000, or roughly $1,000. With this profit, I can withdraw it to my bank account right now, spend it, or leave it there and let it grow.