Over the past few years, I was able to do things that I never would have believed were possible for me.  I was able to leave a career I hated, spend more time with my family, make money while I sleep, and improve my income level. All of this was possible by creating multiple sources of passive income.

Things that produce passive income, are the smartest investments you can make to achieve financial freedom.

One of the most important aspects of achieving financial freedom is separating time from money.  To do this, you must have your money work for you rather than you work for your money. The greatest way to do this is to have multiple flows of passive  income.

Passive income is the ability to accumulate money without actively putting in consistent time to earn it.  You see, when the majority of people need extra money, they decide to get a part time job. Then, they are paid in accordance to the amount of hours they have labored.

Passive income can be earned while you sleep or take a shower.  You put some form of initial investment of time or money at first. Then cash flow is created without constant labor to produce income.

Understand the difference between an asset and a liability

There are many ways to achieve passive income. But in just about every situation, they are in the form of an asset. Most people’s definition of an asset, is completely wrong. Many people believe things like their homes are an asset. By definition, an asset is anything that puts money in your pocket. A liability is anything that takes money out of your pocket.

So owning a home is a liability because you have to pay a monthly mortgage every month. You still have to pay for insurance and repairs even if you don’t owe anything on the mortgage. This still makes it a liability because it is not making income. Banks, however, will tell you that owning a home is an asset because it produces income for them through interest.

The only way that you can turn your home into an asset is if you rent it out. Then, collecting a rent check every month from it. A car is more of an asset because the vehicle provides transportation to go make money. This is a concept that I was first introduced to when I read Rich Dad, Poor Dad. I suggest that everyone read this book because it completely changed my life and how I thought about money and income.

Make it a priority to do away with unneeded liabilities. Get rid of as many things that you don’t need which pull money away from your pockets. Magazine subscriptions, cable tv, phone app subscriptions, and whatever else you can stop wasting money on! Take all the money that you save and use it to build assets that produce a passive income. Having more assets than liabilities is the first step to financial freedom and a universal rule for the financially successful.

Opportunities through the power of the internet

Today, web-based businesses are among some of the largest and most successful in the world. Entrepreneurs all over the world are now using technology to create businesses and sell products or services. There are a million opportunities that are available today that didn’t even exist as little as 10 years ago. The power of the internet has made many things possible.

Do you know allot about a particular skill or subject? Writing and selling an e-book is an excellent source of passive income. An e-book is especially great if you own a website or blog. With an abundant amount of traffic or audience, it is not difficult to introduce the book into that marketplace. Consistently market the e-book on your website and you can literally sell it while you sleep through electronic downloads. The best part is that you will be able to keep the profits because publishers are no longer required.

There are a million opportunities that are available today that did not exist just 10 years ago. Many people just don’t know how to take advantage of those opportunities. Many people have ideas that often never come to fruition due to procrastination. There is a price for procrastination, and it is the loss of hopes and dreams.

I use Bluehost to create and host my websites  and it cost me less than $100.00 per year for the whole damn thing. And this site generated me more income in the 2nd year of existence than my former career did. Thus, allowing me to leave that job and focus on this and other business endevours full time. Talk about a return on investment! You can GO HERE if your thinking about starting a website.

Affiliate Marketing

Furthermore, income through affiliate marketing is another very popular form of passive income for website owners.  Affiliate marketing is the process of  by promoting a product and earning a commission from it. You can find a product you like, promote it, and earn a profit every time it is sold through a link on your site.

I do a lot of this on  leavingweakness.com and I generate passive income every day. Read this in-depth article if you want to know more about affiliate marketing.

Real estate investing is the most popular form of passive income

Real estate if probably the time tested way to achieve long term freedom. You may have a misconception that you need to quit your job to get started in real estate. However, many investors accumulate large portfolios over the years while enjoying the stability of their full-time job. Then are able to one day live off the cash flow that these properties create.

Real estate investing  through rental income in particular can be very rewarding. It has completely changed my life and greatly increased my net worth! The best part is how my rental properties consistently bring in good cash flow every month.

You put down a loan on piece of property and once purchased, you are able to rent it out. Your tenants pay off the mortgage while you also make an extra profit. This is done by charging more for the rent than what your mortgage payment is. There are many ways to accumulate real estate, sometimes without even having cash to do so.   biggerpockets.com  is a great resource that you can use to get started in real estate.

Ripping off the tax man before he can rip you off.

However, the most beneficial part of real estate investing is all of the tax benefits that come with it. You see, most middle class employees will work up to 5 months out of the year just to pay the tax man via pre-taxed income. The vast majority of investors avoid this by the protection of becoming a corporation.  You only pay on what is left instead of paying pre-taxed income.

Many people think of a corporation as a ‘huge thing’ but it really isn’t. It is basically nothing more than some paperwork filed with an attorney to protect your assets by many outside factors. Hell, you can even get an LCC in less than 5 minutes online now without going to a law office.  A great book that I would suggest on this subject is Own Your Own Corporation.

Other options

• Another option for passive income is stocks that pay dividends.
• You can sell your photography on websites such as iStockphoto. These sites provide you with platforms to sell your photos and offers percentage or flat fee of each photo that is sold.
• You can create videos and put them on YouTube. You then attach Google AdSense to the videos, which plays an ad at the beginning of each video. As people click on those ads, you will earn commission from AdSense. Once you upload a video, it becomes a passive cash flow source.
• Make an application or software. Problem solving apps and software are very popular right now and for good reason. This can cost quite a bit of money to have developed, but can provide high yields if successful.
• You can create an online course or learning guide. If you are an expert at something, you can create an online course.
• Purchase an existing online business which is already generating profit
• Giveaway your e-books, apps, plug-ins, or whatever product you created. Then ask for a donation.
• Repackage existing content on your blog into a unified product. Most peoples blogs are all over the place. So why not take the best parts of it that pertain to on subject matter and publish it into a whole new product?

Passive income isn’t some bull-crap pyramid scheme and it actually works.

It has the power to absolutely change someones life if the initial effort is put forth upfront. The problem is that most people never have the gumption to get started.

You stumbled upon this article for a reason, so don’t be that person!