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The Moment When You Realize Passive Income Isn’t Bullsh*t

by | Apr 15, 2024 | Money, Passive Income

Money advice given by real estate millionaires used to piss me off.

The idea of attending a seminar used to feel worse than walking into a car yard to talk with a used-car salesman.

Whenever I heard the phrase, “make money while you sleep,” I used to throw up a little bit in my mouth. Passive income felt like an idea only the rich got the pleasure of enjoying.

It felt like a secret club or a scam that’s spread by gurus in order to sell a $20 book on Amazon called “Dot Com Secrets.” Shhh… don’t tell anyone.

Most of you reading this can relate to the dirty thoughts about passive income. There’s a moment, though, when everything changes and you realize passive income isn’t bullsh*t.

A weird dude with a Nike t-shirt

In 2011, I met an Aussie guy with a Nike t-shirt.

He wore Nike everywhere. We got chatting about writing. He’d been a writer too. He’d written every cheesy listicle you can think of, including “Elon Musk’s morning routine.”

He started a small WordPress blog while working for a telecommunications company. Before that he was a snake handler.

He’d help capture snakes in the Australian desert that went near big mining operations. Without him, workers would quietly get snake bites and die. The funny thing: he was terrified of snakes.

To qualify for this job they put him in a large, dark room full of snakes. He had to survive. Sounds wild, I know!

In both jobs he had his writing side hustle.

His blog made $0 at the start. He did a few SEO courses to try and find some readers. Growth was slow. After a while he added Google Adsense to the website. Tiny payments hit his PayPal account.

At the start he says it was enough to pay for his $3.50 a day coffee addiction. A few months later it also paid for his car parking at work. Six months after that it was also paying his phone bill.

By the time I met him, his silly WordPress blog helped him quit his job and make over $100K.

I asked him how it felt.

He said the moment his life changed was when he made enough money to buy one coffee. I almost laughed. I dug deeper.

He told me the first few dollars flicks a switch in your brain. It tells you passive income isn’t a scam.

The bizarre insight

What changed my mind about passive income was seeing an average person do it. The problem with passive income is it has a bad reputation.

The people who promote it are cheesy as hell and unrelatable. They use borrowed Lamborghinis and photos outside other people’s mansions to sell the dream so they can sell you some nonsense product.

But when you see someone just like you make it happen, the impossible starts to feel slightly possible.

The worst thing you can do is learn about passive income from a critic who’s never earned passive income and is taking out their frustration on the world by saying it’s a scam.

If passive income were easy, we’d all have it.

What makes passive income hard (real talk)

Passive income is hard because it takes a lot of active work at the start to get it going before it becomes passive.

Most people give up before they’ve put in enough active work to qualify for active income. There’s a threshold of participation. For some it’s 6 months, for others it’s 3–5 years.

If you’re patient, listen, and keep an open mind it’s possible to stick around long enough to figure it out. The majority of people won’t because they’re impatient and feel the world owes them something.

If they can’t have it now, they don’t want it at all. Stupid.

Another reason passive income doesn’t work for a lot of people is they choose the wrong option. There are plenty of ways to make passive income. For example, you could write books and live off the royalties.

Or you could create digital products — courses, templates, software — and sell them on auto-pilot.

You could also write online and get paid by the word — this one’s a trap because it is sold to us as passive. You write the content, sit back and relax, and for the next few years that writing will earn money.

But that’s not how it works.

Content platforms have algorithms and they only prioritize new content. So if you want to get paid by the word you’ve got to jump on a hamster wheel and write high volume.

Network marketing is another bad passive income model. The dream is you do some networking for a year, then that network buys the company’s products and you live off the commissions.

What they don’t tell you is the unpaid employees that push network marketing companies have a high churn rate.

The products are often garbage and don’t encourage repeat purchases, so you are forever recruiting new people into the pyramid scheme and getting paid the scraps after the people at the top cream off all the profit.

Like I said, passive income is a scam if you choose a scam way to earn it.

The simple ways I made passive income

A lot of info about passive income is written by people who’ve never done it or made under $100.

I’m average in a lot of ways and have made decent passive income in the last 10 years. What worked for me was having multiple passive income sources. This has de-risked my income and helped me find the options that work best.

My passive income comes from:

  • Books
  • Paid newsletters
  • Digital products
  • Recommending products/services (affiliate commissions)
  • Owning financial assets that generate income (stocks/crypto)

None of these are glamorous or as sexy as Pamela Anderson in the 90s or Tom Cruise in the movie “Risky Business.” But they do the job. They allow some freedom to do whatever I want and not stress too much.

I have a goal to add more passive income sources soon. One option I’m looking at is putting a few ads in some of my website content or newsletters. There’s no extra work and the commissions from any sales are ongoing for the life of the customers.

Again, promoting ads isn’t as sexy as selling some magic protein for gym bros while leaning on a Ferrari — but it works. It’s timeless and simple.

When I see sexy ways of making passive income, I run. New, trendy, *not* saturated, and talked about on TikTok … are the factors I use to screen out passive income opportunities.

I want proven passive income opportunities, not lottery fantasies promoted by a 21 year old in his mother’s bedroom.

Bringing it all together

Passive is hard work to get started but it’s worth it.

It provides a foundation from which you can build a good life with less stress. It’s less about being a millionaire, and more about living comfortably.

For most people, making $50K-$100K a year in passive income is enough — and life-changing.

Stop trying to go big. Just start simply. Get one unsexy passive income source going then add more. Make your goal several years, not days.

That’s how the idea of passive income goes from bullsh*t to real.

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