King bell
VIP Contributor
No, it is not possible to retire on a passive income. If you're just starting out trying to make it as a full-time entrepreneur, I have bad news for you. This is because there are too many variables, and many of them are out of your control for you to succeed at becoming your own boss.
You've heard the old saying that if one knew how hard it would be, nobody would ever do it? Well in this case that's true. It takes a lot more than just following some simple steps like saving money and creating an online store: your business needs to generate cash from day one so buying assets such as land, equipment and hiring workers fully becomes feasible.
A passive income is just what it sounds like. Rather than have to work for the money, your paycheck comes in passively, with no time or effort on your part. When you've retired and are living off of retirement money, a passive income can be how you get by every month.
What does "passive income" mean?
To understand this, it's important to understand what it means for a business to be passive. Let's take an example. If you run a small business, like an office supply store, you're a business owner. You pay yourself from the profits of your business and decide how much more money you want to make as salary, as opposed to profit. On top of that, if you don't want to work every day at the store and have some other job, you can do so and still get paid by the store. Your salary is still passive income because you didn't have control over the money coming in or going out of your business. You work, and your income comes as a result of business ownership, even if you're not directly involved in the day-to-day activities of the company.
Passive income can be earned in many ways
There are a lot of ways to earn passive income. The best way might be to just invest money in something that earns interest. If you put your money in CDs or bonds and they pay at least a reasonable interest rate, you'll earn passive income on that money every month. The interest will come automatically and you won't have to think about it or do anything to make it happen. You'll just notice extra money in your checking account at the end of the month.
You've heard the old saying that if one knew how hard it would be, nobody would ever do it? Well in this case that's true. It takes a lot more than just following some simple steps like saving money and creating an online store: your business needs to generate cash from day one so buying assets such as land, equipment and hiring workers fully becomes feasible.
A passive income is just what it sounds like. Rather than have to work for the money, your paycheck comes in passively, with no time or effort on your part. When you've retired and are living off of retirement money, a passive income can be how you get by every month.
What does "passive income" mean?
To understand this, it's important to understand what it means for a business to be passive. Let's take an example. If you run a small business, like an office supply store, you're a business owner. You pay yourself from the profits of your business and decide how much more money you want to make as salary, as opposed to profit. On top of that, if you don't want to work every day at the store and have some other job, you can do so and still get paid by the store. Your salary is still passive income because you didn't have control over the money coming in or going out of your business. You work, and your income comes as a result of business ownership, even if you're not directly involved in the day-to-day activities of the company.
Passive income can be earned in many ways
There are a lot of ways to earn passive income. The best way might be to just invest money in something that earns interest. If you put your money in CDs or bonds and they pay at least a reasonable interest rate, you'll earn passive income on that money every month. The interest will come automatically and you won't have to think about it or do anything to make it happen. You'll just notice extra money in your checking account at the end of the month.
