Is Passive Income Really a Thing?
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- čas přidán 11. 06. 2024
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Who wouldn't want to make money doing nothing? Passive income is possible, but there are some mighty thick strings attached.
Two Cents is hosted by Philip Olson, CFP® and Julia Lorenz-Olson, AFC®
Directors: Katie Graham & Andrew Matthews
Written by: Julia Lorenz-Olson, AFC®
Executive Producer: Amanda Fox
Produced by: Katie Graham
Edited & Animated by: Dano Johnson
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sources:
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www.sofi.com/learn/content/wh...
www.cnn.com/2023/09/07/succes...
www.perceptionpredict.ai/blog...
files.consumerfinance.gov/f/2...
www.steadily.com/blog/what-is...
www.investopedia.com/terms/s/...
ycharts.com/indicators/10_yea...
www.tipranks.com/stocks/mcd/d...
I need a way to draw up a plan to set up for retirement while still earning passive income to meet my day to day need and also get charged lesser taxes even while in a higher tax bracket. i want to invest around $250K savings.
Don't put all your eggs in one basket; instead, diversify into different asset classes to mitigate risk. If you lack extensive knowledge, consult a financial advisor.
Accurate asset allocation is crucial with an Experts guidance. I have 850k in equity, 300K cash earning 5.25 interest, 685k in 401k, 250k cash account, 120k in car assets ( paid off cars) Gold and silver bars. age is 48. My advisor helped me realign my portfolio to my risk tolerance and it boomed overtime.
pls how can I reach this expert, I need someone to help me manage my portfolio
*Jennifer Leigh Hickman* is the licensed advisor I use. Just search the name. You’d find necessary details to work with to set up an appointment.
Thank you for the lead. I searched her up, and I have sent her an email. I hope she gets back to me soon.
All the TikTokers are raging that this video exists. They want to tell you how to make passive income by signing up for their courses 😆
That’s their passive income. You paying your money for their courses.
I have never signed up for one of these online courses from influencers, and I’m confident I’m not missing out.
Does ANYONE know a single person who has purchased classes like this and benefitted? Ever?
@@steverogers7601 100% correct
@@user-px7ss3nd9g 0% success rate
Usually when I hear the term “passive income,” it’s from someone trying to sell their course on passive income. More cringe is that the course is about how to sell a course on passive income.
So an MLM on courses about passive income.
Well, not really. MLMs are hard because you have to sucker friends and family in to buy/sell FOR YOU. These days, social media algorithms do the pushing for you for the engagement.
@@KafshakTashtakexactly
Even if someone is born in filthy-rich family, he still has to convince his parents to not give the wealth to someone else, so even in this case it's not passive income 🤣
There's no 100% passive income, but there are partially passive incomes, e.g. scalable businesses (like internet-based business which can scale to whole Earth), or a great book/song/YT channel (if succeeds, it's much less work per $ than in other businesses - sadly, very few succeed in those areas).
love the animations in this video, ah, the loop the loop way of how to get rich....the funky ponzi of modern day....I guess most big wins are more or less already decided at birth...
its just hard to accept (as after finding and reading more and more about these folks...either there is a not so known start up fund or their DNA of parents/grandparents in association with connections is like one of a kind and of course there is luck and if they are an industry or industry sub category creator which of course is a bunch of factors - aka the era of the economy ) unless a lucky lottery winner although without much foundation they burn out on the cash in a few years so not exactly castle goodyearS
On a serious note, this single video is more informative and accurate than 95% of the financial tiktoks/reels/shorts made by other creators. Thanks Two Cents team for creating great content!
Haha. True, but it I don't see it as great. Retired at 33. 😂
@bob1234881 Retired from doing what exactly?
Instagram and TikTok never were useful, why people talk like that?
@@bob1234881I wouldn't call living in your parents basement retired
@@djhero0071 I'm gonna guess tech. They make a lot of money right from the get-go, can start young (no college degree required), often dislike their jobs, and the FIRE (early retirement) movement is pretty popular with them. One of my best friends saved like 75% of his big ass tech salary before leaving
I read a story about that one guy who ate nothing but ramen to save up a million dollars and then once he hit that goal got stomach cancer.
Jesus that’s sad, do you have a link to the story?
Gahhhdamn
Sounds like an urban myth, but there is a great message there!
@@colinrussell2017you’re right, in fact there are more people who died from only eating instant ramen but no money saved 😅
@@masterof2d926he made it the f up
Thank you for exposing the influencers selling courses disguised as “financial freedom”
I worked in residential property management for 10 years, and I will never, never own a rental property. I know too much.
property tax too expensive? maintenance too high?
No dude tenants are a nightmare
I lost my 20 unit apartment in the eviction moratorium during covid. Tenants just stopped paying rent, they lost in the end. since i was forced to sell to a profit driven corporation before i was too deep underwater in the property.
The did free up a lot of time to work on my plumbing company that is thriving now.
4 employees, not including me. Grossed 5.8 million last year.
@@Plumber1111was just thinking about a guy I met who is doing REALLY well for himself. Owns a company that just moves dirt and does nothing else.
I love it when I hear about “regular work” jobs raking it in over anyone with an MBA.
@@hulkhoganwwfyep, tenants are scum. They dont care.
You need to get passive income the old fashioned way: inheritance.
That's a one-off lump sum. 😀
@@bob1234881 No, you just invest that into dividends or whatnot.
@@bob1234881interest from having a big chunk of money from said inheritance gives you passive income
@@bob1234881 not if you have enough elderly relatives!
Interest earning bank account mate....
My grandmother, 92, worked as a school teacher, retired at 52, and has been collecting from a pension longer than she was actually teaching! 🤯
That's the way to really profit off of the system.
Well, we’re never going to get to retire.
She has peobably start working at age 16 not 26
@@redaalami6201Nope, basic math - she probably started at 22, right out of college, 30yrs teaching to age 52, has lived 40yrs in retirement. Most union jobs, you max out the pension formula at 20, 25, or 30yrs. Some now require you to be a certain age to collect, but not then/not always.
Many folks put in their 20, then just do a private/consulting version of their old public job for extra cash.
@@matthewcaldwell8100Go look into public-sector jobs, or highly-unionized industries. Lower salary in some fields, but more reliable work, and you still get stuff like pensions & free/cheap health insurance.
Most places will train you, some even pay for your education (my job paid for a Masters in CS).
“If I knew an easy way to make passive income, do you think I’d be working here?!?!?”
Just buy my sun praise based course and you too could achieve massive unearned wealth.
Everyone is advocating investing for passive income, but with a 70-hour workweek and limited financial knowledge, how can I manage it? CZcams videos say "BUY, BUY," but when and how do I sell for profit at the right time?
I also think everyone needs a Margin of Safety in their portfolios and just remember, It's time in the market versus timing the market.
Well all i know is that you cannot go wrong taking profit at near high. No one ever went broke taking a 10% loss. It's best if you consult with a fiduciary advisor to get informed buying & selling decisions
Working with a financial advisor has been a game-changer for me. They provided invaluable insights and tailored strategies that aligned perfectly with my risk tolerance and financial objectives. With their support, I've seen significant growth in my investments and gained confidence in my financial future.
I've been considering getting one, but haven't been proactive about it. Can you recommend your advisor? I could really use some assistance.
I'm cautious about giving specific recommendations as everyone's situation varies. Consider independent financial advisors like “Sharon Lynne Hart” I've worked with her for 9 years and highly recommend her. Check if she meets your criteria.
This video indicates you don't need a high IQ to be a good investor, just 2 qualities, self discipline and a lot of patience. Investing is mostly about behavioral psychology. How can I generate more income to retire with at least $3m for long term care?
We share common goal, making sure you are ready for your later years is very important. That's why passive investing works, low costs, better diversification and it enables people to overcome their behavioral bias especially if they engage professional help.
@@Shultz4334 It's unfortunate most people don't have such information. I don't really blame people who panic. Lack of information can be a big hurdle. I've been making more than $45k passively by just investing through an advisor, and I don't have to do much work. Doesn't matter if the economy is misbehaving; great wealth managers will always make returns.
@@Shultz4334 It's unfortunate most people don't have such information. I don't really blame people who panic. Lack of information can be a big hurdle. I've been making more than $45k passively by just investing through an advisor, and I don't have to do much work. Doesn't matter if the economy is misbehaving; great wealth managers will always make returns.
It's unfortunate most people don't have such information. I don't really blame people who panic. Lack of information can be a big hurdle. I've been making more than $45k passively by just investing through an advisor, and I don't have to do much work. Doesn't matter if the economy is misbehaving, great wealth managers will always make returns.
@@Curbalnk I've been looking to get one, but have been kind of relaxed about it. Could you recommend your advis0r? I'll be happy to use some help.
You definitely have my sub. This content is next level. For me Unimantic was the turning point. Please keep doing what you do and keep being you, love it.
Passive income I think is just a marketing term. "Passive Income" always needs some kind of work to make it happen.
The formula is basically you need a lot of money or a lot of time - ideally both. Warren Buffett makes $1B in dividends from Coca-cola - 30+ years after he bought it. And that cost him $1B at the time.
@@epbrown01 Time is the most important component and it's also the most plentiful thing any of us have. Now whether we're using our time productively or not... different question.
@@BTrain-is8chMaybe when we are young ( 20s) it is the most plentiful thing we have, but in fact it is the opposite in the grand scheme of things:
It is a constantly depleting, non renewable resource. That's what makes it so valuable. You can lose money and earn money back, but you'll never get back time.
Sorry for any existential dread I may have caused🕑💀
@@epbrown01 ok I’ll take the lot of time path, started in my early 40s
Stayed the course, these stocks provide A LOT of passive income via dividends
XOM, MO, CSCO, SYY, ABBV, PNC, CVX, PPL, NEE, T, VZ, IBM, UPS, HSY, PSTL, NLY, CSL, HESM, RSG, and others, not to mention a large collection of preferred stock purchased well under the $25 call price paying 5-6% yields
Large collections of CDs ar 5-5.4% also provide nice “passive income”
And treasury bills too .., 2 minutes work make 50x your bank interest
Lots options
@@BTrain-is8ch really depends on what being productive means to you. I you like just spending time with your children or partner even if you aren't getting anything done is that productive.
Ive always said this, when i hear "create a ytube channel" as advice for passive income, like creating content its very hard and time consuming isnt 100% passive at all
Every passive income requires work up front. But the idea is that you do that first and then it keeps going
Create a ytube channel may not be passive but still better than full time job, you dont have to deal with other people bullshit, you work your own hours from anywhere you want and you dont have a fucking boss telling you what to do, when to eat, when to go to bathroom, what clothes to wear. All that makes me feel like slave.
This video is a passive income: Uploaded once and wait the view go up charge CZcams and do not have to due much .
Takeaways:
- Passive income is defined as "money earned from an enterprise with little or no ongoing effort."
- It's important to distinguish passive income from an investment's growth in value, which is an unrealized gain.
- Even for successful creators, the work required can be extensive, and many express feelings of burnout.
- Starting a business that eventually runs itself also requires significant upfront effort and is not truly passive.
- Defined Benefit Plans, or pensions, can provide a reliable passive income stream, but they are becoming less common, especially in the private sector.
- Rental properties can generate income, but they also come with various overhead expenses and responsibilities.
- Dividend-paying stocks and bonds can provide a passive income stream, but the yields are often relatively low.
Though everyone loves the luxury lifestyle but many don't want to take the risk to invest or work for it.. Now's the best time to buy the dip and it's an opportunity that will grant you all the luxury you crave for.Very interesting content, i would also be glad if anyone here can explain a few things for me, this is 2024 and I believe it's my time to invest and shine for a better future.
I think the one thing most investors miss when calculating intrinsic value, is that they look solely at the history to estimate growth in the future. The growth rate is very important, it arguably should take the most time in valuation. The past 10 years could be unusually good/bad due to acquisitions/dispositions affecting financials. Look to the future and make your best judgements.
There is one thing I have learned in recent months it is to remain calm, especially when it comes to investment in Stock. Learn not to sell in a panic when everything goes down and not to buy in euphoria when everything goes up. I advise y'all to forget predictions and start making a good profit now because future valuations are all speculations and guesses.
I agree, that's the more reason I prefer my day to day investment decisions being guided by an advisor, seeing that their entire skillset is built around going long and short at the same time both employing risk for its asymmetrical upside and laying off risk as a hedge against the inevitable downward turns, coupled with the exclusive information/analysis they have, it's near impossible to not out-perform, been using my advisor for over 2years+ and I've netted over 2.8million.
I think this is something I should do, but I've been stalling for a long time now. I don't really know which firm to work with; I feel they are all the same but it seems you’ve got it all worked out with the firm you work with so i surely wouldn’t mind a recommendation.
I definitely share your sentiment about these firms. Finding financial advisors like Marisa Breton Dollard who can assist you shape your portfolio would be a very creative option. There will be difficult times ahead, and prudent personal money management will be essential to navigating them.
Pension, interest, dividends, annuity etc are passive income.
Managing rental property is not passive income.
Gambling, in my mind, is the "passive income" scam that is hurting people the most. Little effort with huge promises of rewards? Sounds like the very definition. I think we aren't talking enough about gambling right a lot of younger people are tip toeing with it in very volatile/manipulated stocks and sports betting.
Sports betting and video game betting like gun skins are bad as well
@@TheScrubmuffin69 those are forms of gambling
Plenty of people are abundantly clear about the fact that stock picking is essentially gambling. People trying to ride a GameStop/AMC wave deserve what they get.
I mean gambling is a pretty good "passive income" but only when the game is rigged in your favor. It is bad to be the person buying lottery tickets but great to be the person selling them.
Society is so morally decayed that gambling is legalized, in order to increase tax revenue. 😏
It would be nice if landlords didn't treat their investment residences as "passive income" without treating ithem like a business that requires maintenace and has costs.
Fix the goddamned tap!!!
Couldn’t agree more, some landlords have the worst kept properties I’ve ever seen because they simply don’t care as long as it rents out, I work on them from time to time (house
Painter/handyman) and the landlords never want to spend the $ to have them properly maintained, sadly the poorest maintained asset is a rental property…
This is spot on. I never could figure out why owning a rental is called "Passive" income. Whoever says that must not own a rental property.
Or owned a business. When you're the boss, there is no "clocking-in/out" 😅
@@mandisaw *owner, when you are the owner. A boss has to "clocking-in/out".
@@adiahheart9413 True, true - I conflated the two :)
As an active duty Army officer and real estate investor with a dozen residential rentals, I can say that my military pension pays more and is much more passive then my rentals. You pay everything up front with 20 years of service to the pension. After that, it is adjusted to increase at a rate equal to inflation every year and is 100% passive. No matter what, even with an accountant, attorney, and property manager, my rentals will never be totally passive. They are also likely to never exceed my net cash flow from my pension. More work and less money from the rentals, but yet nobody talks about finding a good 9-5 job, working for 20-30 years and retiring. You can't sell a course on that and it is not a get rich quick scheme so people don't want to hear it.
Bravo! Well said!! 👏🏿
And now with the blended retirement it’s such a good deal. You get a little less in pension but that 5% match and the $22k we can put in every year is a lot! I’m on track to have 3million by 60 PLUS the pension which would start much sooner!
It's also not guaranteed anymore - a lot of people search unsuccessfully for years to find that good 9 to 5 permanent job, and private companies increasingly don't want to keep anyone around that long.
Unfortunately the Military is considered to be the last employer in America that offers retirement pensions.
Stock your IRAs if you're offered em, folks
@@gino14 If you joined after December 31, 2017 you no longer receive a pension
Great video.
If a concept sounds too good to be true, it probably is.
Be cautious out there, slow & steady tends to win in the end.
There is another side to this. There are concepts that sound too good to be true simply because they are morally bankrupt and doing them involves taking advantage of others.
Also true, thanks!
I miss the mustache so much 😭
I thought he was another person
@@matteosaottini930 ikr lmao. this is so confusing for a long viewer who got a hiatus. I was thinking that they hired another people for their video lol
I think she looks better without it.
You overlooked the route most people who have passive income took: choose rich parents. The children of the 1% typically have trust funds that provide passive income such that they need never work. Under today’s tax laws, the children of wealthy parents can be given as much as ten million dollars completely tax free between their birth and turning 18, and there are all sorts of specialized legal entities (eg, Walton trusts, intentionally defective trusts, family limited partnerships) that exist so that rich people can avoid paying inheritance taxes, so that their kids don’t have to work.
Good for them! Don't be envious -- it's not attractive.
I think the point of the video was how normies have a hard time with passive income, and battling Tiktoker scams. But ya. I get it.
@@LG123ABCcope
@@LG123ABC The paragraph is just a list of facts. Can you point out which sentence is even an opinion? None of the sentences are opinions, therefore, saying they are jealous is a delusion and says more about you than them.
What's very interesting is how financial tools have been created by rich people in order to stop the "rags to riches to rags" that was endemic with the 19th and early 20th century robber barons. The Vanderbilts come to mind as the most famous of rags to riches to rags. Things like tax-free inheritance/trust funds, step-up loans from banks against assets, and pass-through corporations/non-profit corporations are all very effective tools to create perpetual tax-free zones for the children of the wealthy.
To show just how effective the rich are in not paying taxes, half of the US's billionaires received their full Covid stimulus checks. And even the unavoidable sales tax for people like you and me can be avoided by rich people using a variety of perfectly legal financial tools. Meanwhile, most US citizens pay about half their income into taxes if you include sales taxes, payroll taxes, in addition to income taxes. My effective tax rate, for instance, is 56%. Warren Buffet's effective tax rate, as stated by himself, is about 12%.
Investing in alternative income streams that are independent of the government should be the top priority for everyone right now. especially given the global economic crisis we are currently experiencing. Stocks, gold, silver, and virtual currencies are still attractive investments at the moment.
The dollar is literally being destroyed / debased / devalued. The best performing asset in the history of the world is BITCOIN. BITCOIN is by far the best store of value. 10 years from now you’ll be thankful for every dollar you put into BITCOIN.
Regretting missing out on earlier Bitcoin investments, I kept funds in a HYSA. Now, with $200k to invest, I aim to avoid FOMO and buying at the peak. What's the best approach for a newbie to navigate the market?
well the crypto market is expected to do way better than any other equity sectors this 2024 especially with the SEC crypto ETF approval but it’s a volatile market nevertheless and if you’re new to it, it’s best to reach out to an experienced adviser for proper guidance.
Yes, my asset manager advised I spread further into mutual funds and crypto Etf and boy am I glad I did. The whole idea is: Don’t get too greedy and also to exit at the right time, so generally I do find having an adviser very helpful, because what Avg. Joe really has time to watch and comprehensively analyze the market.
Who is the coach that provides guidance for you? I urgently require assistance; my stock portfolio is stagnating, and I need investment advice for retirement.
It's a misnomer.
You want to have income that can grow beyond the linear dependence on the time you spend.
Dividends and royalties are as passive as you can get.
Of course building up the investment for a substantial dividend is a lot of work. As is creating content and marketing it for the royalties.
Building a business and profiting from the scale of employees is also a answer to what we are looking for.
Military veteran here. Last time I checked, the government no longer has the 20 yr pension commitment. Newer personnel get the Thrift Savings Plan (government 401k/IRA plan). Older personnel still get the pension (those who signed up before 2018/2019).
Military gets 40% instead of half pay plus TSP match
Gov't pensions have taken a beating in the fight to destroy unions/labor (which includes vets!). Some places with stronger unions fare better than the Feds, but it's still usually a better deal overall than private-sector, in terms of retirement.
The military as a career option is another matter, I'll leave that to folks with experience.
@@robertguidry2168 I just read up on it. It doesn't seem all that bad.
As of 2018 anyone joining the military falls under BRS (blended retirement system). The short version it changes your multiplier from 2.5% down to 2%. After a year they add in 1% to your TSP (not the roth TSP) with a match up to 5%. Yes I have skipped over big pieces, but that gives a summary. There is also added incentives such as a 12 year TIS multiplier for additional cash and other things as well. Yes the other person wrote it's 40% vs 50% with all things being equal at a 20 year service.
Common misconception is that the pension went away. It did not. It blended. Lots of legacy folks don't understand it and will spread misinformation about it instead of learning about it.
"Passive Income" is an Internal Revenue Service term. There are different categories of income. Passive Income, Earned Income, Unearned Income etc. They are taxed differently. It is not an accurate description of how income is earned. Hamburger is not ham. Hot dogs are not dogs. Blue moons are not blue.
Baby oil is not made from babies.
I want to say thank you to the guy in the comments who recommended Unimantic to me. You've been very helpful. Thank you!
German spam for the 1st two comments 😅. Here is a real person saying thank you for your content. Always very informative and helpful.
Report it.
@@krzysztofkonopka5559 1st thing I did 😅
I love the pension explanation about how annuities pay 20+25th of their value, so simple
so basically in today's economy it is extremely difficult to live off of passive income especially if you are young unless you are from a family in the 1%. And if you're not lucky enough you can only do so when you're old and have managed to grow your pension fund high enough after working for 50 years or smth
In any economy! Value comes from labor x time, so you'd have to maximize one or the other, ideally both. Even an inheritance just means someone else's labor, in the past.
Correct! "If you ain't rich, then you ain't sheet." --J.P.
@@mandisawWrong. I only care about passive income because Americans live in an economic system where access to basic necessities like shelter and healthcare are deliberately and perniciously withheld/restricted to extract the maximum amount of wealth from the plebs.
Thanks for bringing awareness!
Private sector Union employee here with a Defined Benefit plan(Pension), and a 401K with a 6% match. Definitely looking forward to retirement!
Lemme guess, union? 💪 Public & pensioned over here 😁
I've only seen the best interest rates from investments in the copy trading market, like Eledator, for example.
I appreciate your videos a lot not only the info but your editors,producers and crew sure know how to animate this in a way that is entertaining and simple to understand❤❤❤
This is a very good summary. Passive income comes from making solid income, living below your means, and investing. Or working your ass off. I'm too lazy for that.
Honestly, I don't understand why you're discussing these dubious schemes. There are plenty of options like Unimantic and similar ones that are fast and profitable.
I have to say Julia is my celebrity finance crush.
Big thanks to the entire 2 cents team for putting out great content!
It is for some people. Especially in the entertainment industry. Jerry Seinfeld wakes up and makes coffee. By the time he walks to the mailbox he’s got several thousand dollar checks waiting for him for being in a show that ended 25 years ago.
Yeah, that case can be included in the examples they give at 7:37. Not very much replicable 🥴
What's the deal with residuals?
J "probably knew Epstein" Seinfeld.
4:05 In some cases, you can even "buy time" in a pension plan, replacing that time spent with cash earned from other jobs.
Hmm interesting. Thanks for sharing
@@ladylove34 Sure. Something similar happened to a relative of mine; they worked in a school cafeteria, so they were a state employee. But then they took the cafeteria private. My relative was mostly vested in the state pension, and paid for the rest of the time needed to get all the way vested.
In short, you work until death. The end.
Nah, they left one out: Intellectually Property. Spend a year writing about a kid named… Gary Putter, an orphan who goes to a magic school and has adventures. It becomes a hit, you make billions, done. (Set some money aside for lawyers.) 😂
That's what you voted for.
@epbrown... if only it were that easy, son. 😂 Without coin, corporate connections, crews, clout, computer code, committed communities, and lofty opportunities... nothing significant can nor will ever occur. That's just reality on a planet of eight-billion.
Reflection is truly key.
🐲✨🐲✨🐲✨
"Before I start, I must see my end. Destination known, my mind's journey now begins. Upon my chariot, heart and soul's fate revealed. In time, all points converge, hope's strength resteeled. But to earn final peace at the universe's endless refrain, we must see all in nothingness... before we start again."
🐲✨🐲✨🐲✨
--Diamond Dragons (book I)
Ok doomer
After all the taxes, rules, regulations, policies, fees, red tape, risks and requirements, it's almost like the system is fine-tuned to keep you from getting ahead or something.
It is. The rich don't want any competition.
I don’t think so. People put their own greed first and sabotage themselves.
It's your excuses that's stopping you.
@@handleyobusiness I agree but there's more to unpack on that... your statement is true if your enemy is laziness. I've worked in both white-collar and blue-collar sectors, down and dirty but also in high-skilled environments. Got the work ethic and drive to start a small business. The fight is real.
You'd have to have $500K to become an "accredited" investor status (the cool kids club to invest in cool kid things). I get taxed when I make money; I get taxed when I lose money. I can work my ass off all my life and it won't be enough; I can make investments with that money and still not have enough. I do the "good boy" things to get my credit score up only for that not to matter at all. Want to start a business? You're already -$7,000 in yearly taxes for being "self-employed" now. It's up to us to make up and "try harder" whenever we get nickeled and dimed with silent penalties and fines.
So my point is: is that really on me? Every time someone can get ahead, they'll find a way to stick us so that we don't get ahead. If you aren't zeroed-out at the end of the day, they will and can find a way to make sure you are. _"If you aren't in debt up to your eyeballs then you ain't livin'!"_ There's a reason why more and more people need to take more time and more jobs because maintaining a standard of living creeps up on us, even people that are frugal. The same can be applied to taxes on top of taxes on top of more taxes and, oh hey, here's a new tax this year to put on the pile, sorry bub -- and we let it happen to us so much that it is slowly sinking us into a larger-picture state of misery we as a whole are experiencing.
tl;dr: educating myself about investing and stocks and whatnot over the last year or so, learning a lot. No excuses, you're right. But that action of investing is penalized even if I'm doing everything right. And I'm saying "that sucks." lol (Why bother trying to go the extra mile and succeed when it doesn't pay to put that effort in?)
"Sir, this is a Wendy's." 😬
Only passive income I know of is mutual funds. But even then, people might get caught up moving money from fund to fund too often.
No, a well diversified dividend portfolio without any garbage mutual funds is true passive income as well. 🥱
2 kinds of income:
- What's made just in time (hourly/salary work)
- What's made ahead of time (royalties and value appreciation of investments)
Sure, there's allowances, but that's for chumps.
Your expertise as financial planners is very evident in this video. One of the best you've ever done.
2cent is the best financial channel ❤
for Canadians if you haven't already started, please use your TFSA to buy some financial products like stocks or ETFs. lots can pay more then 2-5% yield div and its tax free to reinvest! so it can compound and really help you get to those financial goals over the long term. good luck!
That's right! I live off dividends from a covered call ETF (HYLD to be precise) which has between 12.5% and 13% yield. I dunno where these people take their 2% to 5% yield, there's waaaay better options (no pun intended).
I'm that someone who's lucky enough to start a business during my uni years, got it to do quite well then continued it after graduation, then covid hits. That's when I earn quite a bit.
I'm 27, with (I believe, if all go well) enough money for the rest of my life. Even then I call myself semi-retired, I'm still running the business but not actively expanding because I enjoy doing something.
But that's because I'm really frugal and debtless. If you're thinking to have enough passive income to live a luxurious life like what those gurus promise you, you have to go to a fantasy world I'd say, or be really really lucky.
Low cost Index/ETFs can pay monthly stipends without limiting the purchaser to dividend yielding companies (dividend yielding company index/etfs reduce investor market exposure unneccesarily).
Is letting your mustache grow out without shaving it a real thing?
Step 1: Have capital.
Step 2: Make your money breed for you.
Also, starting a business is not passive income because it takes work, but a pension does count as passive income? Do you guys want to do a second draft of that one?
Business requires ongoing labor, until/unless you can fully make it self-sustaining (even then, you'll need to strategize). Pension is more hands-off, you just do your normal job, then collect a monthly check at the end.
Happy to live in a country where pensions very much aren’t a thing of the past. Wasn’t aware workers rights were so deteriorated in the US.
America had an ocean separating it of the world's largest communist nation. So America didn't get a taste of civilization.
Hah. Workers having rights! That's a good joke.
My passive income is the stray quarters I find near the vending machine at work.
I've kept much of my savings in cash for safety, but I'm unsure if it's right for retirement. Contemplating investing $400K in stocks, as I've heard investors can profit in tough times. Unsure about my next move.
Yeah, I’m also closing in on retirement, and I have benefitted much from using a financial advisor. I didn’t really start early, so I knew the compound interest of index fund investing would not work for me. Funny how I pulled in more profit than some of my peers who have been investing for many years.
Please can you leave the info of your lnvestment advsor here? I’m in dire need for one
What a share!! it was easy to find your adviser. Did my due diligence on her before scheduling a phone call with her. She seems proficient considering her résumé.
Scam bots unite! ✊️
DRDCX
There are a lot of crooks in the passive income space, but passive income is a real thing through stock investments. Ideally those investments go into something standard but boring (e.g. a mutual fund or ETF that mimics S&P500) and invested via a company that charges low fees (e.g. Vanguard).
It would be nice to see a video discussing strategies for attaining financial independence, rather than just implying it's all a scam. It's not, but the reality is that it isn't simple to attain and it may not be feasible for everyone. But even if not everyone can attain financial independence in the long run, everyone can benefit from applying the strategy to be more financially secure than they would have been otherwise.
Passive income from stocks requires having a _lot_ of spare cash that you can invest up front. I have a decent amount of stocks; I get just a few hundred dollars in dividends per _year._ Mostly stocks are just a good alternative to a savings account for retirement since over the long term they grow faster than the banks’ meager interest rates.
@@trevinbeattie4888there's not really anything bad about investing your money wisely rather than letting it sit in a bank. You're doing the right thing, hows the extra 12% you've gotten this year feeling?
@trevinbeattie4888
You are exactly right
I have over $2.4 million dollars worth of PepsiCo stock. It pays me less than $20k per year in dividends. No wage workers today will have that kind of money to invest in their whole life.
But really, it's not impossible. I earn an affiliate income passively. YES, I had to put in the work to get something valuable up and running, but now the income continues passively. Enough to not waste time by working for a boss. It's like writing a book that sells well, or recording an album that sells well. You'll always have to put in the work first, and make sure you create something valuable. YES, it's not easy, but: YES, it IS possible.
I know many people, especially finance CZcamsrs tend to disagree, but I still consider CZcams income to be passive income.
If you put out a really good CZcams video and people are watching it (like this one - fine work as always!), that ad revenue will continue to come in while you're out with friends, going for a bike ride, eating dinner, on a date, etc. Yeah you had to put some hard work down, but nobody is saying you don't have to put in any work to earn passive income. The point is, once you put the initial muscle in and release a successful video, you will then have money flowing in regardless of what you're doing with your time. It can even get picked up by the algorithm and generate some income YEARS after it was first released. If that isn't passive income, I don't know what is.
I was advised to diversify my portfolio among several assets such as stocks and bonds since this can protect my portfolio for retirement. I'm seeking to invest $200K across markets but don't know where to start.
I thought about investing in the real estate market, I heard that people make millions , but I lack good knowledge and a strategy to outperform the market and generate good yields. I have $460,000 but it's hard to bite the bullet and do it. Money is hard to come by
This seems like the worst period.Even the markets are very unpredictable.started investing recently when the market prices were a bit high,today i am more than 60% down
I began my investment journey at the age of 38, primarily through hard work and dedication. Now at the age of 40, I am thrilled to share that my passive income exceeded $100k in a single year for the first time. This success reinforces the importance of the advicmonth e mentioned earlier. It is not about achieving quick wealth, but rather ensuring long-term financial prosperity.
Fantastic! Can you share more details?
was guided tho..Julia Hope Marble. walked me through the ropes majestically i'ts my ultimate pleasure.
I mean, passive income does exist... you just need to put a lot of money to make a noticeable income from it.
Yeah I'm getting 20$ a month in passive income from my dividend paying etf lol. Not exactly liveable 😂😂
CD investment: hold my beer
Mr. Ryan Gosling now becomes more of a hippe - Gosling
Are you still just holding coins? Guys, what are you doing? Eledator has been around for almost a year!
And the thing with passive income is, you are living now. Life is short. Do you really want to dig a well through your best years that you could retire as a rich old man? When money is least useful to you?
What about basic luxuries like your own place to live or your car to buy and to maintain? Won't you have any medical expenses to cover like dental? Don't you want to own any luxuries? Passive income like people advertise is unrealistic. The best investment I have done was to my own standard of living. That is, I bought an apartment. It shot up in value. I'm richer now than I was before. If I'm going to marry someone who already owns place to live, that apartment already could serve as a rental property.
Excuses. Its not that hard. Im 26 and generating $500 a month of Passive income. Sadly once you turn 35+ it is very late to invest or chase passive income.
@@tvb4227 Is this a point when your alternative accounts recommends me to research an investor?
@@REgamesplayer First you do is find a broker. Robinhood, Webull etc etc.
Then you find a business that usually pay higher yield.
But before you jump into that you will need a savings of atleast 80k. That pays averaging $300 - $350 a month from bank interest.
You re-invest that passive income ofcouse.
Then you switch up to broker. Targeting and buying businesses that is focus in GAS, BANK, REIT, PREMIUM INCOME AND ETF. They are usually the one pay higher yield.
Be discipline AF. Live with parent if you have to. Once it reaches $800 a month of passive income. That where fun begins doesn't matter if you move out or not.
Im in my 4th year. Almost in my 5th year and it starts to show up.
7th year is where you harvest that Beauty more valuable than GOLD, DIAMOND OR DEPLOMA called ''THE COMPOUNDING INTEREST''
Read bunch of finance books, follow Warren buffet style but focus in yield not richest. Warren buffet might a billionaire but his too old. The target to be free young. Not be free old.
Only few people reaches it and Im next ;)
@@tvb4227 So, you already need to be rich in order to be rich. Got it.
Fantastic video. Keep them coming! I learn so much!
Simple counter examples:
-Trust Fund
-Shareholders
-Rentier class (landowner, I.P., lender)
Next video: "Is retirement really a thing?" in this same vein
I mean, I could retire now at 38 but will continue to work to help out my friend. So, yes but no?
One more option for those who are better at tinkering: License your patents. Obviously this one has a huge barrier of entry in that you have to be able to make something worth licensing, and the life span for said patent is 20 years, but hey, it's one option. But at the end of the day, passive income is hardly passive. Takes a huge amount of energy/time/resources to build up something that can generate more money than what you can do with your own two hands.
The patent system is broken and good luck ever getting a penny for something you patent.
Rental income is my go-to because I have access to $0 down mortgages through VA home loans.
Being able to gain control of a $700k+, appreciable, income producing asset every year without spending any money has been life changing. Sure, each unit profits me less than $200 per month, but that adds up very quickly. I've been at it for three years now and I already have 12 units. That's already enough to retire on, not even including the hundreds of thousands in paid off principal and equity gains.
Plus, when the mortgages are finally paid off that profit will shoot up to five figures per month.
I'll probably continue for a few years, and then shift my full focus to dividend investments.
I was about to click off at first, because I heard _"Passive Income"_ and I thought it was one of those annoying _"let me show you the secret to..."_ ads 😅😂
Passive income does not mean free cash. It means putting some amount of up front work and create multiple streams of income that require limited attention. Investing in index funds, stocks with high divident yield, creating content, joining a startup with revenue share are all valid passive income streams.
Yeah this is it.
A lot of comments are full of negativity. My two cents on the issue: Evidence shows that wealth growth is directly linked to market exposure. Market exposure is linked to market optimism. Although it is alright to be careful when someone is selling you anything with a conflict of interest (e.g., insurance, anuities, etc) it is equally dangerous to become over-conservative (or even economically depressed) and stop trying.
You guys are great. Thanks for making such an informative video 😊
very good video tbh. kinda shallow, but a good basic summation of things! and i'm to the right of attilla the hun so i dont like complimenting pbs lol.
video doesnt mention the 4% rule directly, but yeah it says you can generally safely withdraw about 4%, inflation adjusted, of a given investment (mostly stock) portfolio. So you need a million $ just to clear 40k in annual inflation adjusted income by this measure. One good side effect though, is that in most cases using the 4% rule is conservative enough (since it needs to cover the worst cases) you will usually (not always!) end up with a significantly larger portfolio at the end of 30 years (the generally assumed "retirement" period of the 4% rule) than you started (that 1m could turn into 2 or 3m).
Right now of course you can earn a safe 5-5.5%, but we cant expect rates to remain this high.
The only "real" passive income is royalties and residuals. Mariah Carey earns 2 million dollars yearly from "All I want for Christmas is you".
If you ain't rich to begin with, there is no possible way to become rich without corporate connections, crews, clout, computer code, control, committed communities, and lofty opportunities. Mariah C. had them *ALL*. It's as simple as that. No exceptions.
I've been doing affiliate marketing for years as a side hustle and you can make money with it and it. In my case it turned into a high paying full time job when one of my clients brought me on as staff. That being said there was a study that said 64% of affiliate marketers make less than $1,000 a month, I suspect it's higher than that. During the pandemic were my best years (everyone's stuck at home on their computers) I made 3k one month. Other than that it's almost always less than $1,000. There's no such thing as 'easy money' unless you're doing something illegal or immoral.
I prefer the FIRE plan with dividend growth stocks or REITs. You might want to aim for higher starting yields of 6-8%, learn how to avoid yield traps, and have a good backup plan in case of dividend cuts. Even if it takes 5-10 years of work and sacrifice, it's better than working decades. The money is very passive, but the irony is you typically want to work more hours to accumulate faster.
I love it. I love the moral of the story. Passive income is possible but not without work. I like to call unstructured income. It’s not a nine to five, but you still need to work hard.
Well a lot of time it's a bunch of work upfront but then less work total going forward to maintain. You would get to work much more part time to get full time income eventually but there are some full time weeks. Or... i mean some jobs are very one to one service where there is only one of you and you can only get a certain amount of money total from any one client you're working directly with. Passive income, alternatively, gives so much potential for growth and scaling your business to actually make you more revenue and profits.
But I don’t want to work that hard.
passive income and compound interest should go hand in hand, otherwise that income will not be able to keep up with inflation or present living expenses
Congratulations . That must be a great feeling. I aspire to get there one day. I'm 47 years old and I made the decision to start using my money correctly to work for me that way in the future I can be financially stable and independent from needing to work for someone else. Right now I am making 30 K a year net income in my current. job. But I am in the process of getting a skill to where I can make 70 K which I'm sure will be about 50 K net and then I want to start saving until I have a certain amount that way I can invest, and at the very least, I can be financially free from having to work for someone
Please talk more about annuities! They are benefits and cons for people
While I acknowledge the FIRE community is very lucky to combine financial education with goal setting and long term discipline/planning, I think the implication that it's similarly likely as winning the lottery is not correct. My chances of winning the lottery are close to nil (well, straight up nil because I don't play the lotto). I am FIRE, however, and I know at least 3 other successfully FIRE people. Structuring for passive income is definitely hard though, and yes it took choices the average person won't make.
Only 3 successful FIRE people?... So your basically saying it's not likely to work then? No lie, but I have actually met more lottery winners than people who achieved FIRE.
@@AK-47ISTHEWAYI'm financially independent because I was born to already wealthy people. It was a lottery win. Financial independence is only a goal when you know you live under a financial system that actively exploits you and doesn't care about your welfare.
Thank you for this :) As someone who runs a business, whoo boy is it a lot of work 😅
You don't run the business, the business runs you! 🤣
In terms of the rental property, you could just hire a property manager, but that would also add an extra cost - it might only be worth it if you already have a decent cash flow on the property. For things like dividends, I agree it's highly unlikely you can retire early off it. However, even a small amount can make a huge difference in your life. Eg. Let's say you make 1000/year in dividends and every year you decide to put that towards your house. After 10 years you paid off an extra 10k.
You guys make consistently great videos, but this one hit the ball out of the park. Spot on and realistic assessment. Please never stop
Idk if you have already done a video on this but I could use one on high yield interest accounts.
I think they did, try searching the channel for savings or the FDIC
That's funny 'cause I live off passive income, mostly rentals, It's easy! Just inherit it!
Creating a passive income is NOTHING like winning the lottery. Winning the lottery means basically doing nothing but gambling and then winning, pure luck. Building an investment portfolio over 10 or more years requires both a plan and the work of saving consistently to make it real, night and day difference between the two. Also, you don't understand real estate, you actually WANT a mortgage, because you don't pay it, the TENANT pays the mortgage, but YOU get to use other people's money to own MUCH more real estate than you could afford using just savings. This is why $100-$200 a month passive income from each property is really good, because you get to deduct the depreciation of that property from your taxable income, making that money effectively tax free, and then you can just save that income and your earned income to use another large mortgage to buy a second property with a second $100-$200, and then you snowball it into a huge income over time.
I love this. You made a video that spoke what I have been skeptical about. All those IG ad are not making money on what they claim they do but sell their classes to make their core money.
Serving in the US military has this other than pensions. Go ask a military recruiter about it.
Here's what I would tell any young person getting ready to enter the workforce: 1) Minimize your expenses in every way you can (live with your parents, roommates, etc.) 2) Have a goal of investing 50% of your GROSS income into an S&P 500 index fund such as Vanguard 3) Plan on living like a monk/hermit for at least 10 years
If you can get through 10 years of deprivation, you should end up sitting on a substantial nest egg. Now you can begin to think about dating, getting married, buying a house, etc. You might even have enough to pay CASH for some lower-end rental property.
lol you forgot step 0 have rich parents.
Marry a wrong person and see your plan *0
This is good advice. I shorten it to, get money buy assets, for those in the back...
Get money buy assets
Get money buy assets
❤
❤
Thank you. Sometimes, in my independent research, I see the advice "Buy land," and it bothers me a bit cause I was looking up how to build wealth, and I'm thinking, "How can I buy LAND when I'm trying to save my coins".
Rule 8 indicates you don't need a high IQ to be a good investor, just 2 qualities, self discipline and a lot of patience. Investing is mostly about behavioral psychology. How can I generate more income to retire with at least $3m for long term care?
We share common goal, making sure you are ready for your later years is very important. That's why passive investing works, low costs, better diversification and it enables people to overcome their behavioural bias especially if they engage professional help.
It's unfortunate most people don't have such information. I don't really blame people who panic. Lack of information can be a big hurdle. I've been making more than $30k passively by just investing through an advisor, and I don't have to do much work. Doesn't matter if the economy is misbehaving; great wealth managers will always make returns.
I've been looking to get one, but have been kind of relaxed about it. Could you recommend your advis0r? I'll be happy to use some help
Vivian Jean Wilhelm is the licensed advisor I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment
Thanks for sharing, I just looked her up on the web and I would say she really has an impressive background in investing. I will write her an e-mail shortly.
I will be forever grateful to you, you changed my entire life and I will continue to preach on your behalf for the whole world to hear you saved me from huge financial debt with just a small investment, thank you Carla Koren.
I'm surprised that you just mentioned Carla Koren here. I met her at a conference in 2018 and we have been working together ever since.
The very first time we tried, we invested $1400 and after a week, we received $5230. That really helped us a lot to pay up our bills.
I'm new at this, please how can I reach her?
You trade with Carla Koren too? Wow that woman has been a blessing to me and my family.
Initially I was skeptical, until I decided to try. It’s huge returns is awesome! I can’t say much.
I'm definitely making most of my money on property, which is little work, and rental income is definitely what I'm thinking of. 12% return on investment excluding price increases 20% after. Ok, interest rates will make a dent, but I'm still doing well on 2 houses and a flat. 😀
Also, with shares, you can use the 7% over inflation on a low-cost index fund. Basically, selling what is required, but really, it is a way of growing your saving where as a bank account loses real value.
It's best not to go for high dividend stocks as they don't do so well.
are you factoring in renovations and capital expenses?
@amanasd26 The 12% and 20% is based on the money I put in. I.e. geared nice to the my mortgage.
The 20% is based on 4% price increase and 1% decrease due to maintenance. :(
Of course it isn't truly passive but only requires little effort.
I love every time your episodes come up. Thanks for putting out this good info.
What about just buying a stock market index and collecting dividends forever, to its pretty passive. You can use the income to compound
Simple. I have $2.4 million in PepsiCo stock. It pays me less than 20k in dividends per year. You would have to work more years than the average American lives to have a chance to have that much stock. Let alone then trying to live off the dividends.
@@Praisethesunson I retired at 36, I live off about $200K a year funded by dividends, I live in Australia though, where we have high dividends because Australia tax laws benefits dividends. USA tax law causes companies to buy back more. stock rather than pay dividends, so in the USA case you could sell 4% of your stock each year to increase the cash flow, thats just harvesting the retained earnings used to grow and buy back stock that other countries would normally pay in dividends.
@@user-ug5bc2ym6p You buried the lead. How much principal capital do you have that you net 200k per year off it's payouts? However much that is, that's the part the proles cannot participate in.
Passive income do exist you need a good financial plan and investment plans to earn from it. Like for me I earn through stocks and crypto, a brokerage firm helps me out, limiting my time in the market and risk. I’m favored financially with Bitcoin ETFs approval, Thank you buddy. $12,000 monthly profit regardless of how bad it gets on the economy.
Same here, I believe the Bitcoin ETFs approval will be life changing opportunity for us, with my current portfolio made from my investments with my personal financial advisor 1 totally agree with you
YES!!! That's exactly her name ( Audrey lauren) so many people have recommended highly about her and am just starting with her 😊 from Brisbane Australia 🇦🇺
I’m a long term investor, I withdrew my profits of over $61,000 during the COVID 19 pandemic ….
I’m a retiree and even though I started investing late in life , having other means of money apart from ur salary is very important and will do you a lot of good 😊
She is my family’ personal Broker and also a personal Broker to many families in the United States, she is a licensed broker and a FINRA AGENT in the United States…