Financial independence is easily one of the most liberating feelings, yet the millennial generation is crippled with student loan debt and an over saturated market with educated individuals. With that, the acronym F.I.R.E or Financial Independence, Retire Early has gained traction. The idea with financial independence is not necessarily to retire, but no longer require a dependence on actively working. To achieve this, you need to work on growing your passive income streams. Below are ways to begin building passive streams of income that will enable you to achieve F.I.R.E. status.
Own a Portfolio of Dividend and Interest Producing Assets
Building a portfolio that has the ability to appreciate in value, as well as produce monthly, quarterly, or annual income is a very popular method. This could be something as simple as having a well-diversified portfolio across multiple asset classes that is geared towards income. The goal with this portfolio is to build it and simply monitor from a far, adjusting semi-annually or even annually.
Real Estate
Another way to build a stream of income is through real estate. Now, you may be thinking you don’t have enough money for a house, and that is perfectly fine. There are two schools of thought with real estate, and the first is purchasing physical properties. From here, you can rent out these properties and collect a monthly stream of income, allowing you to focus on other business building adventures.
The second way to gain exposure is through a REIT or Real Estate Investment Trust. This allows your portfolio to have exposure to real estate without actually investing in the physical property itself. Utilizing REIT’s would be a great way to add to your dividend and interest-producing portfolio as well.
Create A Blog/Website
A third option to build passive income is build a website or blog. The difficulty with this is it can take quite some time before you see results. Unlike the first two options, creating a brand through blogging requires effort up front, before it becomes passive. In order to do this, you will want to find a market that interests you, and begin posting valuable content. With this, you can attract a flow of attention and generate income through advertisements and services you can sell directly to your audience. This can be a solid stream of income, but does require upfront work.
E-Book
Similar to building a website, you can look into writing and publishing an e-book. With the progress in technology, nearly everyone can write and publish an e-book with relative ease. When choosing this path, ensure your book can stand the evolution of life because this will allow it to be a passive income stream longer. Some topics to consider include recipes, personal finance, and self help information.
A few other ways to generate a passive income stream include building a mobile phone application. Find an issue or problem that needs fixing and create an app for that. From there, you can either sell advertisement space or allow your users to upgrade for a small cost. You can also look into becoming social media influencer should you have a large following regarding a particular industry or lifestyle.
Building a passive income certainly takes work upfront, but the idea of passive is once you build your portfolio you can step back allow it to run itself so to speak. Nothing is ever truly passive, but instead it requires little maintenance as is self-sustaining in a sense. By doing this, you can propel yourself to obtain F.I.R.E status and begin living the life you deserve.