“He who fails to plan is planning to fail.” Winston Churchill
Every path you take in life requires some sort of planning on your part. Whether your plan is nothing more than how you take that first step down a path towards the unknown, or your plan involves the visualization of what lies at the end of that path, you should always have a plan for your future. It doesn’t have to be a well-defined, written out plan, but without a plan, your future may not be all you might hope it would be.
The fear of the future should never prevent you from planning for that event. Everyone’s future is uncertain in the present. None of us knows what tomorrow brings. When the sun comes up on a new day it brings with it joy and hope. Joy in that we are able to witness the coming of the new day, and hope in that the new day brings many blessings. When the day ends you should always be thankful that you were able to be a part of something new, and make a plan for the next new event in your life.
I’ve always enjoyed sunrise and sunset; sunrise for the excitement that comes with the beginning of a new day, and sunset for being able to be thankful for being a part of what sunrise brought into my life. Beyond sunrise and sunset I’ve held firmly to the idea that my future is a three part event. There’s one year out, three years out, and six years out, and they each involve a multitude of sunrises and sunsets. Each of these plans I lay out involve things I wish to accomplish during those periods. Every year, at the end of October, I reevaluate my three plans. Sometimes things in my one year plan become multi-year events. There are times when proposed accomplishments take less time than I originally planned. And, there are those times when my idea of the future changes enough that one or two of my plans need to be rewritten. That is why I address what my future might be on a regular basis. Nothing is static in this world, and your future is a living, breathing event that will grow, or shrink, depending on how you work towards it today. Without an effort now you will find yourself at the mercy of events beyond your control.
What I want to address today is how passive income influences your future. Any additional income during your retirement years allows you more flexibility in your life. It might be the difference between visiting your favorite restaurant twice a week versus once a week. It could very well allow you to attend the theater with friends instead of watching tv alone. In short, however much additional income you can rake in will allow you the opportunity to do things you want instead of doing things doing things you must because you do not have the money necessary to do what you desire. In order to achieve all you desire out of life you must write this idea into your plans.
I define passive income as monies received from sources other than trading your time for money. Do not think that passive income is easy money. It requires work: initially there is some outlay of time and commitment on your part. This type of income includes monies received from rental property, royalties from books or music you’ve published, being a silent partner in some venture (I think of a restaurant where your investment nets you a monthly tab based on the dollar amount you’ve invested), blogging, affiliate programs where you direct people to online retailers, selling your crafts, dividend income, multi-level marketing, pension income, and social security. This list is not all inclusive, but I think you get the idea.
I’d like to address the last two income sources; pensions, and social security. Each of these incomes involves a large amount of your time and effort before you can be assured of a steady source of money being deposited in your bank account at retirement age. You might work for a company for 20-30 years before they begin paying you a steady income when you leave their employment. Social security benefits are based on your highest 35 years of income, and you’re not eligible unless you’ve paid into the system for a minimum of 10 years and have reached the age of 62 (full retirement age depends on your year of birth—65 to 67 years of age). They both require a large outlay of time and effort on your part during your younger years before enjoying any benefits during your golden years.
The other methods of acquiring passive income might be less demanding, but they all require work on your part. To my knowledge there is not a source of passive income that does not require some amount of effort from you. Your goal is to have money coming in without the demands of hours upon hours of work on your part. My goal has always been to achieve a set amount of income by working only 20 hours a week (I shoot for 4 hours a day, 5 days a week, but sometimes fall short). That leaves me ample time to pursue things I enjoy doing; off-roading, hiking, reading, talking to rocks, or even watching the grass grow. I feel useful, in that I accomplish something everyday, and am still able to do the things I want. It provides some sort of routine to my life.
Initially, you might have to work at setting up your passive income stream while working a traditional 40 hour a week job. It might take a year or more to achieve what you set out to do. Some people work at it 5-10 years before they are able to enjoy the fruits of their labor. Just know that you will have to put effort into your venture.
Let me finish up with three points that are vital to the success of your plan:
You’ve got to love what you do. You cannot expect success unless you are doing something your really like doing. If you’re in it for just the money, do not expect the money to come to you. Whatever you do, it has to be enjoyable, and helping someone else along the way adds to your enjoyment.
Expect to put in some serious time to succeed. If you are not willing to work towards your goal, then do not expect to reach that goal. It will not come to you. It should be something you really want, and are willing to sacrifice to achieve. As everything else in life, work and sacrifice on your part will lead to your ultimate success.
You can never just quit and expect the money to roll in. It’s not going to happen. Just like a pension plan and social security, you’ve got to put in some amount of work on a regular basis. It might be 5-10 hours a month or 20 hours a week, but you have to make a commitment and stick to it. However much time it will take, just know that in order to succeed it will require a continuing commitment on your part.
In short, if you want to acquire any amount of passive income, regardless of the dollar figure you hope to achieve, you must love what you do, work at it, and never quit. You know you want it, so go get it.