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Passive Income Strategies

January 21, 2019

Author: Bianca Yang
Email: ipacifics@gmail.com

One of my goals for this year, perhaps before I graduate in June, is to set up a passive income strategy generating $500/month. I think $500/month is going to be a fairly tough goal, based on what little I’ve seen of other people’s reported passive strategies. But $500/month ($6k/year) is large enough that it actually feels productive.

Below are a couple of the ideas I’ve had:

Passive income doesn’t have to be 5 min each day for 100K a year. As long as the hourly rate is above some minimum, like $500/hr, and the yearly commitment is below some maximum, like 200 hours (10% of 40hr/week yearly work rate), your strategy could be considered passive income. With that definition, perhaps there are even some side jobs that would qualify as passive income. For example, giving talks, or occasional consulting jobs.

My goal with this passive income endeavor is to FIRE (Financial Independence Retire Early). Sure, with a software developer’s income, it’s “easy” to achieve FIRE (where’s the sarcasm text modifier), but the easiness is still modulated by the size of the capital base you need to accumulate. I’ll need to do the calculations to figure out how much money I actually need to be happy going forward.

I mentioned above that I would talk about real estate later. Now’s that later. I also mentioned in my previous post that I would talk about things people find repeated value in. This idea is currently very rough, but I was thinking about how people can repeatedly enjoy using a piece of land yesterday. For example, think about the repeated value of a park, a mall, a basketball court, a soccer field, your backyard, a pool, etc. I guess I want whatever I create as a passive income generator to be reusable. If it’s subscription software, I want people to continuously use it. I want people to continuously seek out my rental property. I want people to continuously look for my t-shirt designs. I want people to frequent my franchise. If it’s investing, …, I suppose I want whatever I invest in to have that repeated value quality to it.

Maybe the above paragraph is a bit stupid, because everything, from shoes, to your desk, to your clothes, has repeated value. Things get consumed and need to be replaced all the time. That’s just part of the cycle of life. We fight hard, work hard, do things every day because flow and happiness are elusive. We need to go out and search, to seek our flow each and every day. Maybe that’s what I was thinking about yesterday, over that mediocre bowl of ramen.