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What is PASSIVE income & Why is it SUPERIOR to EARNED income?

There are so many ways to prepare for retirement, but one method reigns superior to all other methods... Earning Passive Income! Think about it, you're old and fragile and you just want to enjoy the last 20 years of your life travelling and hanging out with your spouse. As enjoyable and rewarding as working is, do you really want to sit around in an office for the last few years of your life when you could be learning Salsa in a foreign country?

There are two types of income in the world. One that you have to trade your time for (working for money) and one that you simply earn while lying on the couch with your feet on the living room table and eating junk food.

You may be thinking "uh huh, how is that even possible?" Good question. This is known as passive income. Some examples of passive income includes: writing a book and publishing it on amazon. Once the book is written, you'll earn money even while you're sleeping, as long as people are buying your book. Another is buying mutual funds and stocks. Once you have some nice securities that continuously provide a return throughout your lifetime, you are pretty much earning that money for free. How about starting a business? This is also a great source of passive income. When you're building a business that produces passive income streams, you're basically creating a "system" that will generate revenue for you, whether or not you are there.

These are just some ideas to get the ball rolling, but one thing is for sure. Before you can start earning passive income, you'll need money to invest into the source of your passive income. For example, without earned income to buy a laptop, you won't be able to publish your book that people will buy while you're asleep. Without earned income to buy stocks, you won't be able to eat pizza on the couch while Fortune 500 companies produce dividends and appreciate in value. Without earned income to buy houses with, you won't be able to lie on the beach while renters pay off the debt of your house for you.

The point is, in order to start earning passive income, you'll have to invest in the vehicle first, and the only way to do so is to work for your income in the beginning. Then once you have saved up enough, you can begin investing in businesses, bloggers, mutual funds, houses, and other passive income producing streams. Of course, there are risks involved in this so do so at your own risk! For example, stock prices may plummet, 90% of businesses fail, and your house may be vandalized by tenants. However, what's the fun in life if you can't take a little bit of calculated risk with your money?

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