The Truth About Passive Income

The Truth About Passive Income


Where does money come from? I have a mentor who asked this question, because we all want money. We all want more of it. But where does money come from? And one of my mentors,
Jesse Elder, likes to say that money very simply comes from other people’s bank accounts. Now, I’d say this
because we love this idea of passive income. How do we passively get people to give us money on a regular basis? Look, I believe you make
your money in business, and you diversify, and
you create cash flow, and somewhat passive income through what you invest in. That’s where your passive
income comes from. But behind every investment is a business. There’s no secret source,
there’s no secret well of money coming from somewhere. Good investments come
from good businesses, and good businesses are serving customers, who are trading value for dollars from other people’s bank accounts. So there really is no
truly passive income, because at the end of the day, all passive income still has to be in a good business that is providing value for other people’s bank accounts. So, the way that you get the
most passive income possible is through what you invest in, by investing in good businesses. On the stock market, privately,
through investment funds who invest in real estate,
or other sources of passive, passive for you, but not
passive for the business that is actually operating. So, once you make your
money, the way that you get your mailbox money, the way that you get automatic income, is by you either investing in businesses that are already being
run by someone else, or by you investing in things
like dividend-paying stock or real estate investment funds, where there are people
actively doing something to grow the business and
provide value for customers and you just get the check
at the end of the day. So, I made all of my money
building internet businesses, and the way that I get my cash flow is I buy dividend-paying stock, I invest in real estate funds where there’s other people who are doing all of the active work
and just sending me a check, I buy websites that other people manage, where they’re selling advertising, but somebody else is
managing that whole process, and these are the things that I invest in for passive income. But what’s important to understand is that there is no truly passive income. And the reason that’s important is because behind every source of income is some sort of a business, and if you forget that
people are on the other end, then you end up doing some
very dangerous things. And you end up looking
for hacks and tricks. There are no hacks and tricks. There is simply always
providing more value for other people, and if you do that by building businesses that provide value for people, and then you invest in other businesses that also provide value, that is how you become
rich, and you become free.

9 Comments

  1. Invictus Astus says:

    Great advice. Thanks Ryan!

  2. InternetBizUni says:

    Good video Ryan, too many sell passive income for what it's not.

  3. Roman Yashchenko says:

    Great point. Thank you for the short video.

  4. Zsolt Papp says:

    The true passive income is to own the central bank as a monopoly which loans money to the government from thin air. That is real passive and safe because taxes will always be there and you get interest on money what you never owned.

  5. Alex Reyes says:

    Wow , this is so well put

  6. Practical Life Advice says:

    Useful! Thanks for the advice!

  7. NOBEL DJ says:

    stocks

  8. Chewie 13 says:

    Love your car, I’m getting one within 5 years.

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