Passive vs. Earned Income
Passive Income is more scalable than earned income. Why is that? Because earned income requires your work, presence, effort, attentiveness. Usually, working professionals have one, a maximum of two, earned income streams. Passive income streams, on the other hand, can infinitely scale to ridiculous amounts with some focus and good decision making. Whereas earned income requires personal and Human Resources, passive income simply requires your capital and great investment choices.
Scaling Your Passive Investments
As you snowball your passive investments, you are easily scaling your passive income to levels that can potentially meet or exceed your earned income. What happens when your passive income grows to such amounts. Well…you become “job-optional.” I first heard this term from an associate, Nathan Radford, who used it to describe the state in which working professionals have the option to work or not to work based on their financial strength. My personal belief is that all working professionals should strive to become job-optional.
Becoming Job-Optional
Regardless of whether you love your job, are serving a major purpose or want to continue to grow up the corporate ladder, it is wise to strive to become job-optional. The reason for this suggestion is because without passive income, your income stops coming in when you stop coming into work. During today’s times, there could be a number of reasons for people’s jobs to be disrupted. Not to mention, the pressure in that many working Americans face is weighty and overwhelming. A little peace comes when there are other streams of income aside from the w-2.
You do not need to be an entrepreneur to become job optional. In fact, to do so requires obtaining the proper financial mindset, taking steps towards sound passive investments, repetition and time. Passive investments in Multifamily syndications are a great investment vehicle for working professionals who seek financial freedom and diversification. As a next step fro you, If you have not already checked out our free Passive Investor Startup Guide, you can download it here here.
Also, schedule a call with us to find out if passive investing in the multifamily asset class is right for you.
Safe investing!
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– How To Use Your 401k To Invest In Real Estate
