The adage “time is money” never feels truer than when you’re getting paid by the hour. Long term, though, trading your time for money isn’t a sustainable goal. To get real financial independence, you need to start thinking in terms of finding something besides your time to trade for money.
Photo by Delwin Steven Campbell
As personal finance blog Afford Anything explains, this is the core concept that all passive income boils down to. Trading 40 hours of your week for money is great when you’re starting out. When you get to be 60 or 70, it’s going to be a lot harder. Working towards assets that can pay off over the long run — like writing a book, owning a rental property, or just having good investments — is what will sustain you:
Creating passive income involves swallowing a rough pill that the Conformist Majority despises: you’ll need to embrace upfront work, in exchange for self-sustaining riches down the road. Ramp up, so later you can ramp down. Front-load your workload. Passive income isn’t “something-for-nothing.” This ain’t no lottery, and it’s not a get-rich-quick scheme. You’ll be planting seeds today, so you can harvest freedom for the rest of your life.
Of course, most of us have ourselves trained to believe that the only thing we can trade for money is our time. No one’s going to pay you to sit at home, right? Except, we often see that this is true time and again. You have to put in work to earn money, but it doesn’t have to correlate directly to a set number of hours each week. Putting in money now for long-term gains can do more for your wealth (and happiness!) than a stable, endless 9-5 job will.
“I Want to Create Passive Income, But I Don’t Know Where to Start” — Part I [Afford Anything via Rockstar Finance]