An income stream formula is your personal approach to generating real passive income.
Creating enough wealth to meet your financial goals requires a real plan.
You cannot leave it to chance.
Unfortunately, few of us can work ourselves to the point of meeting our fiscal goals. There simply aren’t that many jobs that pay enough salary to secure our retirement needs, save for big purchases, or simply level up financially.
So, what’s the other option?
Passive income streams.
To use them, you need a solid income stream formula to get started.
Let’s take a closer look at what that is and how you can create one.
What Is an Income Stream Formula?
The income stream definition we like to use is simply a way of receiving consistent income. The formula portion of the process is how you piece together the way you’ll do that.
Some people do it by working a 9-5 job and saving every extra penny they get. Others do it by working 12 hours a day, 6 days a week.
Then some use passive income streams to generate their wealth.
These individuals typically infuse passive income into their income stream formula because they recognize the power of doing both.
When you combine the power of a consistent paycheck with the power of passive wealth-generating ideas, you create a super income stream that is difficult to beat.
Develop your income stream formula by determining what your financial goals are, how your 9-5 job can help you meet them, and then how other income streams can fill in the gaps.
One form of income is called “passive” income. Let’s take a look at what that is and why that should matter to you.
What Is Passive Income?
There are three types of income: active income, passive income, and portfolio income.
Active income is income you generate
Passive income is earnings that come from any enterprise that you are not an active participant in. This can include a variety of income-generating processes. This includes rental property, limited partnership, and any investment. Active income and passive income are both taxable, but they are typically treated a bit differently by the IRS, as well.
In recent years, passive income has become a term used by work-from-homers who want to earn money without being actively involved in it. When we use the term here, we’re talking about any activity where income can be earned easily without your participation. Here are a few examples.
Rental Properties
Rental properties are any passive income in that the way you earn your income is passive. You own a space and are renting it out to tenants. Yes, you may have to work with a property management company to ensure the property is in good standing, but in general, the earnings you make are passively generated.
Royalties
Royalties are payments that are started by one firm considered the licensee, to another firm or individual considered the licensor. This is done to use the latter’s intellectual property. So, this could include videos, music, or even books.
Portfolio Income
Some consider interest earned and dividends paid on portfolio items passive income. It also requires little to no effort to maintain, making it a shoo-in for our definition of passive income earnings. However, keep in mind, some analysts don’t see portfolio earnings as passive, but we’ll group it under this term for our sake in this post.
As with any job or investment, each of these types of passive income comes with varying levels of risk and work. However, each pays out passively, meaning you don’t have to actively work to be paid for your participation in the investment or project.
In the next section, we’ll discuss a few easy ways you can earn passive income and use it to infuse your income stream formula for success.
5 Bonus Passive Income Ideas
1. Create an Online Course
Do you have a special skill or knowledge set that other people want to learn about? If you do, create a video course about it! Whether you know how to sew or can help people put together model airplanes more efficiently, there is a niche for everything so don’t count your skillsets out!
2. Publish an eBook
An eBook is another way to share your knowledge with the world while earning passive income. The good news is, virtually anyone can self-publish through Amazon’s Kindle Direct Publishing, iBooks Author, and countless other platforms. This form of passive income falls under the royalties category, where you’ll earn based on sales performance. Investing in marketing will go a long way towards pushing people to your business. Once the book is written and published, you can generate income forever.
3. Start a Podcast
Podcasts are another great passive income idea since all you have to do is invest in a microphone and maybe some podcasting software, and you’re good to go! Share your knowledge or interesting take on hot topics and push people back to your business/product in the process. You might even score some advertising partners along the way.
4. Start A Vending Machine Business
Vending machine passive income is a real thing. A vending machine business lets you use your creativity and business savvy to determine the best places to put your machines to earn income. Be smart about it and you could earn thousands of dollars per month in income.
5. Create a Blog
If you’re passionate or knowledgeable about any topic, start a blog! You can earn income through ads and affiliate links.
How to Get Started With Your Income Stream
Ready to start creating an income stream formula to generate passive income? There is no better time than now to get started.
If you’re new to this world, then take it slow. You don’t have to try multiple ideas at once.
Take one idea and start from there and build on it until you have multiple streams of income.
This is especially true if you’re afraid you don’t have enough extra income to invest in another stream of income. And look for ways in your daily life to cut back on expenses like eating out or buying luxury items. Your savings will add up much more quickly if you do.
Anyone can use passive income to increase their wealth. Hold yourself accountable and get organized, and the sky is the limit for your income.
Start Achieving Your Financial Goals
Reach out to Stewart to get started on your journey to financial success. He’s a wealth coach that will get you where you want to go.
