Passive Income! Is It Possable?

Passive Income Vs. Linear Income

Passive Income! Is it possible create? The answer is yes. Unfortunately those late night get rich fast infomercials have given "passive income" a bad rap. Most people hear "Passive Income" and think of those scummy get rich quick schemes promoted by infomercials on late night television. In reality,passive income is a type of income not a program itself.

There are two types of income. The first is Linear Income and the majority of people earn a living with this type of income. It is simply trading your time for money. You work for an hour and get paid for that hour. Lets say you build custom doghouses and it takes you four hours to build it. let's assume after you pay for all the materials you make a profit of fifty dollars. If you work forty hours a week ( a normal work week) building doghouses you would be able to build ten units. Your income will look something like this: 40hrs / 4hrs per unit Times $50 profit per unit = $500. or ( 40/4=10 x 50= 500)  Your annual income is limited to the number of hours you can work times the hourly rate your paid. As you can see, earning money with this model is greatly restricted by time.

The second form of income is Passive Income.   Lets keep the dog house example from above. Instead of building custom doghouse, you draw up a set of plans listing all the materials and step by step instructions need to build the custom doghouse and you promote the plans for $19.99 on the internet as a downloadable PDF file. You create the product one time but unlike building the doghouses, you can sell your plans over and over again while you sleep.  Also, you are not limited to customers within a five mile radios of your business like you are when you build them.

There are many different ways to create passive income. The path I chose to build my first stream of passive income was through building a niche website and placing Google adsense adds on it. In addition to Google adsense I will eventually place Affiliate Ads and sell advertising space. The key here is to diversify through having multiple websites. Also, if this seems hard to you or you don't have any computer knowledge don't worry. It's not that hard to do. In fact you will probable obsessed with it once you start getting the hang of it. I Did!!!