INSIGHTS

Passive Income

Serdar Bıçak

24.01.2023

What Is Passive Income?

Passive income is a type of income that is earned without labor or time. For instance, passive income may pertain to the type of income generated from a rental property. Another example is income in the form of a stock that generates an annual percentage payment. It is expressed as the income that investors earn without effort. Passive income is money earned from activities in which you are not actively or directly involved. These may be investments that you made money on, or jobs that you did in the past that continue to pay dividends today. In brief, passive income relates to the idea of making money work for you.

How Do I Make Passive Income?

Because most of the society has been conditioned since the industrial age to generate active income, very few people know about passive income and how to generate it. Passive income, unlike full-time employment or freelancing, does not require much time and effort. A common way to generate passive income is opportunities and activities where you can turn money into assets. Methods of obtaining passive income include buying and selling real estate, investing in the property of public companies through the stock exchange, and putting money in fixed-term deposits. Passive income also includes royalties from a book you write, an online course you create, or rent from your real estate.

What are the Advantages and Disadvantages of Passive Income?

When you have a passive income, you no longer depend solely on your active income to cover your living expenses. Passive income means you can make a profit whether you work or not. Some types of passive income may be more profitable, such as renting out properties you own where tenants have to pay you a monthly fee. Since the company’s payments are scheduled every three months or every six months, the proceeds from the stock can take the position of a steady income stream. Interest gains on government bonds and term deposits are also examples of sources of passive income. However, keep in mind that it may take years to start earning a substantial amount. To start generating passive income, whether in terms of money or time, you need some kind of initial investment. You have to spend a lot of money on things like rental properties, stocks and bonds and even businesses before you can start generating passive income for yourself. Many people do different research on passive income sources and want to think of it as the main source of income, but the main benefit of passive income is also its flexibility, which is the biggest drawback. With passive income, you have little control over your earnings, so you may own property on passive income. However, without a tenant, you will not have a regular income. Additionally, as stock prices go up and down, you might lose money on stocks. Investing in corporate bonds also carries the risk that the companies will close and not be able to pay you back.

What Is a Passive Income Job

Especially in the recent years following the outburst of Covid-19 pandemic, the method of generating passive income has come to be widely relied upon. Working from home has also been providing additional income alongside one’s day job. This refers to work done over the web without any material investment or exit. For instance, there are branches of business that diversify passive income such as article writing, online article editing, distance learning and training videos, creating a platform for product promotion and sales by opening a channel on YouTube.

What is the Importance of Earning Passive Income?

The most important benefit of passive income, which stands out for its advantageous nature in terms of generating additional income, is that you don’t have to spend time to make money. Continuing to spend time and effort on an active source of income prevents you from making the most of your time. With this, it becomes much easier to spend your time on things you enjoy, relying on passive income sources. Another important point about earning passive income is that it allows you to automatically continue earning money in the event of a potential job loss or unexpected situation. Taking the right steps at this stage offers both legal certainty and a chance for high productivity.


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INSIGHTS

Passive Income

Serdar Bıçak

24.01.2023

What Is Passive Income?

Passive income is a type of income that is earned without labor or time. For instance, passive income may pertain to the type of income generated from a rental property. Another example is income in the form of a stock that generates an annual percentage payment. It is expressed as the income that investors earn without effort. Passive income is money earned from activities in which you are not actively or directly involved. These may be investments that you made money on, or jobs that you did in the past that continue to pay dividends today. In brief, passive income relates to the idea of making money work for you.

How Do I Make Passive Income?

Because most of the society has been conditioned since the industrial age to generate active income, very few people know about passive income and how to generate it. Passive income, unlike full-time employment or freelancing, does not require much time and effort. A common way to generate passive income is opportunities and activities where you can turn money into assets. Methods of obtaining passive income include buying and selling real estate, investing in the property of public companies through the stock exchange, and putting money in fixed-term deposits. Passive income also includes royalties from a book you write, an online course you create, or rent from your real estate.

What are the Advantages and Disadvantages of Passive Income?

When you have a passive income, you no longer depend solely on your active income to cover your living expenses. Passive income means you can make a profit whether you work or not. Some types of passive income may be more profitable, such as renting out properties you own where tenants have to pay you a monthly fee. Since the company’s payments are scheduled every three months or every six months, the proceeds from the stock can take the position of a steady income stream. Interest gains on government bonds and term deposits are also examples of sources of passive income. However, keep in mind that it may take years to start earning a substantial amount. To start generating passive income, whether in terms of money or time, you need some kind of initial investment. You have to spend a lot of money on things like rental properties, stocks and bonds and even businesses before you can start generating passive income for yourself. Many people do different research on passive income sources and want to think of it as the main source of income, but the main benefit of passive income is also its flexibility, which is the biggest drawback. With passive income, you have little control over your earnings, so you may own property on passive income. However, without a tenant, you will not have a regular income. Additionally, as stock prices go up and down, you might lose money on stocks. Investing in corporate bonds also carries the risk that the companies will close and not be able to pay you back.

What Is a Passive Income Job

Especially in the recent years following the outburst of Covid-19 pandemic, the method of generating passive income has come to be widely relied upon. Working from home has also been providing additional income alongside one’s day job. This refers to work done over the web without any material investment or exit. For instance, there are branches of business that diversify passive income such as article writing, online article editing, distance learning and training videos, creating a platform for product promotion and sales by opening a channel on YouTube.

What is the Importance of Earning Passive Income?

The most important benefit of passive income, which stands out for its advantageous nature in terms of generating additional income, is that you don’t have to spend time to make money. Continuing to spend time and effort on an active source of income prevents you from making the most of your time. With this, it becomes much easier to spend your time on things you enjoy, relying on passive income sources. Another important point about earning passive income is that it allows you to automatically continue earning money in the event of a potential job loss or unexpected situation. Taking the right steps at this stage offers both legal certainty and a chance for high productivity.