Rich people and their passive incomes

28 Jan 2023

Passive income is basically the goal that everyone is want. So, how the rich got Passive income?

The first one is the passive income of interest. The first thinking of many people is to save money in the bank. This is the most basic passive income. The words are also quite impressive, but under normal circumstances, people with such a large amount of money will generally not eat such a low interest rate.

In the area of ​​passive interest income, besides banks, there is another kind of usury. This kind of usury is not the kind of usury that we hear, but the rich generally have their own small circle. In these small circles, everyone is in business. Since they are in business, even if there is money, there is a time when capital turnover is tight. At this time, the small circle plays a role. Everyone understands each other better whether it is borrowing money. People who have borrowed money are relatively more trustworthy. People who need to borrow money will have a lot of procedures if they go to the bank, and it will take time, and sometimes the amount of funds may not be large, if it is a social loan , Then the security is self-evident, if something goes wrong in the business, debt collectors are not easy to mess with.

The interest rate of borrowing money in one's own circle is much higher than that of banks, but it is lower than social loans, and the security is much higher. For those who lend out funds, so a small circle is also beneficial.

The first one does not have to worry too much about the safety of the funds, and the second one gets much higher interest income than the bank. In fact, this model is very popular among the people, and it does not require you to have too much capital. You can get good income with spare money. Of course, this requires you to be in the circle of others and most people are not in that circle. They are not familiar with it, so naturally they dare not take the corresponding risks.

The second is the income of fund securities. There are various financial management courses on passive income. Among them, the most mentioned is fund management. Generally, people with middle-class income have more passive income in this area. Suppose When the deposit reaches about 1 million, many people will buy some lower-risk fund products, or speculate in stocks according to their own capabilities.

A friend of mine was fired from job in 2020 because the company’s business was not good. The company now only has a polished commander. When there is a project, it will be assigned to the employees of the previous company to do part-time work. Although the company is disbanded, the income has dropped. A big chunk, but he trades stocks every day, and his monthly stock income is about $1000, which can basically cover his daily expenses, and there is still some surplus. Of course, making money from stock trading is not an easy task. It requires a person's comprehensive ability and it must attend a lot of tuition before that, so ordinary people must be cautious when trading stocks.

The third is asset-based income . The most typical method is the house bought 15 years ago. So far, the housing price has basically doubled. If prices is doubled in big cities, it is basically less than 1 million. It’s a few million. It’s very difficult to earn a few million from work. Asset income is actually not as difficult as everyone thinks, because in the previous years it was leveraged. A 30% down payment for a house of 2 million is 600,000, although hard work can hardly make you a rich person, hard work can still make you able to afford the down payment. If you are in third- and fourth least developed cities, the house price is much lower. The difference is whether you did the right thing at the right time, it is difficult for people who are troubling and thinking about getting passive income through assets.

The fourth is income from intellectual property rights . For example, if you write a book, this can be a continuous source of income. Now some well-known entrepreneurs will publish their own autobiography, which is actually a kind of passive income.

The fifth is income from sideline business. The term sideline sounds a bit small. I feel that only ordinary people have sideline business. In fact, rich people also have sideline business, but the scale of this sideline business may be larger, such as investment. A certain small business, these small businesses all have a common feature, that is, if it is spread out at once, it will continue to generate income later. For example, we often see the claw machine. Under normal circumstances, people who can make money from the claw machine are rich people. Ordinary people don’t make much money from it, because the threshold for claw machine seems to be low. High, in fact, there is still a lot of business logic inside. Some resources and other reasons prove that ordinary people will not have it, but for the rich, these things are much easier.

The sixth is stock dividends . You can never get rich when you go to work. This sentence is absolutely not wrong, but you have to know that there are many people who make money through work. What is the difference between these two sentences? To say that you can never make a handsome amount at work refers to relying on dead wages, and to make a fortune through work refers to owning the company's stock. Once the company goes public or the market value rises, you will be able to obtain excess returns. And some company executives may be earn tens of millions or even hundreds of millions of dollars because company is listed on stock market, so don’t think that you can’t make a fortune at work. This is a wrong view. Don’t think that your hard work is useless if you don’t have stocks. People with stocks are not born with stocks. When you work hard to a certain level, there will naturally be stocks, but you have to work hard before that.

Of course, the passive income of the rich is far more than the things mentioned above. Today I will just briefly talk with you about what passive income the rich have, what inspirations are for us ordinary people, and how we ordinary people should improve their own Passive income?

Next, let me give you some suggestions.

First, never think that work can’t make a lot of money . For most people, you can’t make a lot of money at work, but work is the fulcrum for almost every ordinary person to make a lot of money. It is impossible to make a lot of money, or to have a relatively high income from sideline business. Whether it is asset income such as buying a house or investment income of stock funds, the premise requires you to have a certain amount of capital in hand. Without the most basic amount of funds, you simply cannot do other things.

Second, if you are an office worker, you must find a second way. It can be a simple sideline business or passive income from assets . Many things seem difficult, but if you divide such a difficult thing into several years to work hard and carry it out, you will find that it is not as difficult as the people says.

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