Money Mindset

Money Mindset discusses the experiences and opinions of a middle-aged professional on the topic of money, including: financial planners, investment experiences, part-time income sources, real estate investment and private sales, web site income opportunities, changing professions, home office organization, money education for kids, and many other subjects I have experienced first hand or even just thought about.

Tuesday, March 07, 2006

Passive Income

Passive income is simply income that your investments generate each month. It takes no additional work for it to happen. If you invest in assets that generate cash each month with no money from you, then eventually, the passive income stream will exceed your monthly expenses. When that happens, as long as your monthly expenses don't keep increasing, then you have "infinite wealth", meaning you can retire and live off of your investments.

Oops, My Expenses Grew, Too!

I mention "as long as your monthly expenses don't keep increasing" because I realize that if you don't make a conscious decision to budget and pace your spending it gets very easy to change your lifestyle to match your new passive income. There's nothing wrong with increasing your standard of living as your means increase, but just realize that you won't be able to retire until you make an effort to live within your means.

OK, There's Still a Bit of Work...

So, the way I look at it, if you are looking to retire on passive income, the only work you should need to do to "stay retired" is to manage your expenses to stay within your means.

For more discussion on passive income, please read the link below posted on Robin J. Elliott's blog.

Passive Income at Real Success Blog.

Should you decide to go further with Robin Elliott, and join the Joint Venture Forum, which explains how to generate passive income with no money and no risk (but some education and a small amount of time), please indicate that you found him through "Scott at Money Mindset Blog".


... Scott

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