What are your thoughts on an Immediate Annuity as a passive income vehicle? I suppose it’s not a great investment since you never get your principal back, but the risk is zero and the cash flow is fairly good, approaching 6% currently. And, since you are guaranteed payments for life, you may not care that you never see your principal again anyway since you’ll be dead!
Given the growth in the sharing economy, your junk can start to pay for itself. For example, if you have some awesome vintage furniture inherited from your grandmother sitting in a storage unit, you can rent this out to photographers for their “styled shoots” which are becoming all the rage. If your furniture is more modern but you still can’t bear to get rid of it – perhaps a home stager will be interested.
Real estate is the obvious choice if you are going to make money on your money. I personally am not at the point where I can do any of this in a meaningful way BUT my parents are and they now own a couple homes outright and are collecting income from them to power their retirement income. It makes a lot more sense for anyone that has a chunk of cash sitting in the bank and are planning on slowly drawing from it because you technically still have all that money in a property (or multiple properties) and can sell them if you really need the lump sum of cash but you’ll earn great interest payments until you do that.
Ask yourself how many hours a week do you spend sitting in silence, coming up with an idea and working on your idea? We’re so busy with our jobs that our childhood creativity sadly vanishes at some point in our lives. There are food bloggers who clear over $15,000 a month. There are lifestyle bloggers who make over $10,000 a month while living in Thailand. And there are even personal finance bloggers who’ve sold their sites for multi-millions.
Throughout his teaching, Shea will help you master the skills necessary to build an Amazon affiliate store that functions just like a powerful e-commerce site. That includes picking a niche and doing relevant keyword research; picking a theme for your affiliate store; setting up that store; implementing e-commerce SEO best practices, promoting your site; utilizing basic email marketing; maximizing conversions; and eventually outsourcing your work to efficient virtual assistants.
A company called StreetShares helps mostly veteran small business owners (also some non-veteran owned) acquire capital for their business cash flow needs by providing loans. What’s really cool is that these loans are funded by investors. For a $25 minimum investment, all U.S.-based investors can earn a flat yield of 5% on their money by investing in StreetShares Veteran Business Bonds.
Great breakout of some common items that are (mostly) accessible to individuals. My biggest issue with p2p is the ordinary interest it generates and the ordinary tax that we have to pay. That really takes a bite out of the returns. Fortunately, I opened an IRA with one of the providers to juice the return with zero additional risk. 6-8% nominal returns over a long period of time will make me very happy. It should end up as 5-7% of the portfolio anyway, so nothing too significant.
Anthony, nice setup! To your question about the rental mortgages, you haven’t said what interest rate you are paying. As a start, if you are paying more than the risk free rate (Treasury bills) which you probably are, then a true apples to apples comparison would be yes, pay off the mortgage. But, if you are comfortable taking more risk, you have other options to invest in which you *hope* will yield you more over the coming years. You also didn’t say whether the rentals generate net income and if so, how much? What is the implied rate of return on the equity you have invested in them? If you pay the mortgages off, you’ll have even more equity tied up, will the extra net income make that worthwhile? Maybe you should use the money to buy more rentals instead, if purchase opportunities still exist in your town. … this is less of an answer than a framework to analyze the decision, hope it is helpful.
I personally don’t care about being seen as rich – I don’t need the fancy house or cars. I just want to know that I can give up some or all work whenever I’d like to, and spend that time with my family without any financial pressure. I remember reading somewhere that “wealth is measured in time, not dollars” – and I believe that to be totally true. If I ever got a tattoo, that phrase would be highly considered to end up somewhere on my body.
Managerial accounting defines residual income in a corporate setting as the amount of leftover operating profit after all costs of capital used to generate the revenues have been paid. It is also considered the company's net operating income or the amount of profit that exceed its required rate of return. Residual income is normally used to assess the performance of a capital investment, team, department or business unit.