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What if you just had two separate sources both earning you $250 paychecks ($500 total) per month without you doing additional work. And these sources just paid for your automobile expense.
Perhaps you have beaten this concept to death at this point Good. Rich Dad Poor Dad tattooed this concept onto my brain. The concept is exactly what Real Estate Investors predict Cashflow.
Again, I realized that I DID NOT want to become rich when I was 65 if it cost me my life during my younger years... I'd rather have a wholesome amount of cash coming in each month from several sources and retire early. Or do WHATEVER I wanted after the army without having to consider the paycheck coming out of my new hobby, project, or even occupation as a portion of this equation.
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Both terms"residual income" and"passive income" try to capture the identical concept of,"making money mechanically." For the sake of brevity, I will only be using both terms interchangeably.
After hearing the words"passive income,", many of us immediately begin having romantic visions of lounging on a yacht in the Caribbean Sea and occasionally checking our growing bank account. You immediately snap into it, have a sip of your Monster Energy drink, and try to stay alert while on your 24-hour responsibility in the barracks. .
An asset is something that puts money in your pocket each month. It's a lifestyle and wealth multiplier.
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A liability is something that takes money from you every month. It might be a temporary lifestyle enhancer, but a long-term way of life and wealth killer.
Teach yourself to this point that you can find and purchase American Real Estate that you rents in a higher price that all of its expenses and there is still a significant amount left over. The residual money is that flow of income or cash flow.  Finally, when we start looking at these income streams collectively, it becomes known as"residual income." .
Admittedly, setting up your own Real Estate Investing Business is NOT easy... however, with the proper education, Real Estate Investing does NOT have to be hard. However, you have to learn and act.
Now, in case you all of the above makes sense, a funny thing will start happening. When you begin talking to people about finances you will soon begin to realize that there are two different kinds of people in the world: those that understand the difference between an asset and a liability, and the Look At This ones that will NEVER be wealthy. .
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Every one of those entities are money making systems. They create income while costing very minimal personal work or time. Even if one of these ended up costing me a million dollars a month but made two million dollars a month, it's an asset.
Honestly, who cares how much You're spending on an advantage every month when it earns you more than what you spend Now let's take it one step further... what should the spending was automatic and was that the earning
When there was a machine that spit out two dollar bills once you gave it a single dollar bill, you would be glued to this machine daily! Moreover, you wouldn't care whether that machine charged you 50% interest on your dollar prior to generating you the two bucks it spit out. .
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Since passive income inherently means that I do not have to spend the most expensive thing in life, time, in order to earn a certain amount of residual income.
Since some people who hear the word get disappointed when they realize there's a great deal of education and some significant setup required on the front end of the journey to financial freedom (our"Why"). Again, this isn't a get rich quick scheme, but it is a hell of a lot better than what I had been taught by some of my military and veteran mentors. .
As members of the army, we often believe it would be exceedingly hard, or maybe even impossible, for us to find time to earn extra income. So far as our professional prioritiesour army service should be in the very top. So how can we ensure that we are setting our new real estate investing business up for massive success How can we make certain it doesn't create more stress than pleasure.
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They key is to leverage our VA benefits, minimize our personal housing expenses, and focus all of our savings towards producing resources... a.k.a. rental properties.