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What is passive income?

Tags: what is passive income, how to build passive income, passive income examples

There are three types of income: earned, passive income and portafolio.

In earned income, you make money direclty as a result of your work. Either you are an employee, or self-employed, you need to work hard everyday to make money. If for any reason, such as sickness, you stop working, your income stops flowing too. I hope you see the problem there.

Passive income is the money you earn even if you dont work. It is cash generated by an asset that you control. Examples: renting properties or machinery, getting royalties from some piece of artwork that you own (music, movie, books and so on). One very popular way that can be started from your home part-time is building a web site. Then you can build several tipes of passive income sources: selling online, using online advertising (specially google adsense, which is by far one of the most popular), an affiliate program or a referal program.

The portafolio income is a particular case of passive income, where the asset that you control and produces money for you is, well more money. Exmaples: interest income over a sum of money you already have (in banks deposits usually), dividends from shares holding, or profits from stocks, bonds, etc.

All those are examples that have something in common: they make money for you on their own, they are on autopilot.

This is why passive income is such a great thing, and why so many people want to learn how to build and manage passive income assets. Passive income method and techniques are on an unprecedent revolution right now thanks to the internet, and many online entrepreneurs are learning they way thought it, while having fun and making big money thought their assets. Start now learning more passive income examples.

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