Choosing Active Income Over Passive Income

[Ayuba Ernest]

There has been a recent trend of people choosing active income over passive income. Active income is income that you earn through work, such as a salary from a job. Passive income is income that you earn without having to work, such as dividends from stocks or interest from a savings account.

There are a few reasons why people are choosing active income over passive income. First, active income is more reliable. It's easier to predict how much money you'll earn from a job than it is to predict how much money you'll earn from investments. Second, active income is often tax-free. This is because you are only taxed on the money you earn from a job after you have already paid taxes on it. Third, active income gives you more control over your money. With a job, you can choose how much money you want to earn. With investments, you can't always control how much money you'll earn.

However, there are also a few reasons why people are choosing passive income over active income. First, passive income can be more flexible. With a job, you usually have to work set hours. With investments, you can choose when and how often you want to work. Second, passive income can be more profitable. This is because you don't have to pay taxes on the money you earn from investments. Third, passive income can give you more freedom. With a job, you might have to answer to a boss. With investments, you can be your own boss.

So, which is better? It depends on what you're looking for. If you want more control over your money and more predictability, then active income is probably a better choice. If you're looking for more flexibility and higher earnings potential, then passive income is probably a better choice.

 

[Natella]

I like to combine active and passive income. This way you can get much more profit. By the way, passive income can even exceed your income at work.

 

[Jasmine]

Why should you have to choose between active income and passive income? Why don't you continue with your active income and in the mean time also build your passive income source. You cannot give up your active income source at once because doing so could push up into financial crisis in case you failed to generate another income source. You cannot also continue with your active income source without working on passive income source. You need both to become financially free. In fact, you can use your active income source to build your passive income source. Fir instance, you can save money regularly and then invest money on stock. When you receive dividends on your stocks, you will be earning passive income sources. You also need to be highly knowledgeable and skilled in order to build passive income. You also need to work very hard. It takes a lot of time to build passive income.

 

[Mika]

If your passive income is making you enough money to cover your monthly expenses, enough to provide for your wants (going on a vacation, for example), as well as enough to save some money for emergencies and reinvest in other assets, I think there is no need to start with your active income source. You can focus more on your passive income sources and try to increase your income through your passive income sources. Let's say I have a job that pays me $3000 per month but eats my 8 hours of productive time, also imagine I have a passive income source that requires only 1-2 hours in a day to manage but earns me as much as my job, wouldn't it be nice to quit the job and focus more on my passive income and increase my overall income, and in the meantime also enjoy a life that I missed by working in a company for 8 hours a day.