How to Determine If Your “passive Income” Is a Second Job
If you’re currently trying to create a passive income stream – because you’re striving for financial independence , chasing that 4-hour workweek, or just hoping to make some extra money – you’ve probably figured out that generating passive income takes a lot of work.
After all, you can’t just build a website and hope people buy what you sell; you need to find your ideal client, find a solution to his problem, effectively promote the solution, etc.
It’s almost like giving yourself another full-time job, but it doesn’t have to be. At least not after you earn passive income.
As entrepreneur Nat Eliason explains , the whole point of a passive income stream is to create something that makes money passively . By itself. Without your participation.
Here are Eliason’s thoughts on the difference between passive income and work :
Passive income is not a very descriptive term. It is more helpful to think about building a passive selling machine. Something that can sell something with a minimal investment of time.
There are several key criteria for PSM:
- The product must be easy to maintain, otherwise you will always be working on it.
- Marketing must be easy to maintain, otherwise you will always sell it.
If it’s not a simple product with a simple sales funnel, you don’t have a PSM, you have a job . So if your goal is to create a steady stream of passive income based on PSM, then you need to find things to sell without constantly worrying about the product being sold or how it is being sold.
Eliason expands on these thoughts into a guide to developing a true source of passive income, so if you’re wondering why your passive income project is more like a job, or how to develop a product that can actually generate passive income, check it out.
Because if you want a small business, you have to start a small business.
If you want to generate passive income, you will need to think more carefully about what you are selling.