Passive income means that you set up a business that can run itself with little or no input from you.
Make no mistake, there is nothing passive about starting a passive income business, and the income part is more of an out-go to start out with.
Once you get over that initial hump, once you have the system worked out and running on its own, you can let it run by itself, take the profits, and either live the life of Riley, or start another passive income business or both. You can only have one job, but there is no theoretical limit to the number of passive income businesses you can have. That is a test for a passive income business: if you can only ever have one, then it is not passive income.
Examples of passive income that you are probably already familiar with: if you write a book and it becomes popular, then you get the royalties without doing any additional work. Note the word additional. Writing the book was likely a lot of work in the first place (although some smart people do a “Chicken Soup For the Soul” manoeuvre and get others to do all the writing for them. Talk about passive!). Promoting the book is also a lot of work. But if you do the first two steps right, then you could have passive income in the long run.
Running a website is a great example of passive income. Again, you have to set it up properly. It takes a lot of work to start a website, promote it, figure out the best way to monitize it. If you are technical, and understand web marketing, then you will certainly find that the website will make money even if you are not working on it. Bit that comes later. Don’t fool yourself into thinking it is a sure thing. Don’t expect success within two months (possible, but better you count on two years of hard work).
Real estate is often passive income. Buy an apartment building, hire a building manager, and let them collect the rent and deposit it in your bank account. Financing the purchase may be hard work when you are starting from nothing, but once you get started, it gets easier and easier, and you don’t have to do much to make money on your previous purchases, if you have them set up properly.
Passive income is not necessarily easy. It is hard work in the beginning, and not everything is guaranteed to succeed. The point is that once you figure it out, once you have a system, you can keep replicating the business, multiplying your income and dividing your effort.
Passive income is hard work, but it sure beats working for a living!