It’s the ultimate dream, reach the million dollar net worth! Once you’re there, you’re set.. At least thats what most people have been led to believe. However, is this really the case?
You go to work and its the same grind, day after day. “If I only had a million dollars saved” (or pick an arbitrary high number) I could “retire” on the beach and live like Jimmy Buffett. This ideal is plagued wildly throughout the United States, and often I wonder why? Yes, its true, a million dollar net worth would very likely help out, and could help you “retire”. However, is that what it takes to live the good life?
Years and years of boring compound-interest dissertations, and “Warren Buffett said buy index funds”, “my financial advisor showed me this fancy graph”, and “oh no, don’t buy now, the market is in a bubble.”
We hear new advice from the latest guru, daily. All of this can seem overwhelming and confusing, and it definitely can be.
However, I’m here to present a new idea, or new to some. Its called passive income, and it beats a stock market net worth by far. Its not just owning rental properties, its much more, and I believe its one of the keys to living a fulfilling life of value. Passive income adds monthly cash, as well as the currency of flexibility and time to our wallets.
Imagine this, your total monthly expenses including your mortgage, utilities and food, add up to $3,000 per month.
All you need to “retire” or as I refer to being financially independent (FI), is passive monthly income equalling and slightly surpassing your monthly expenditures. Lets say, $3500 per month in passive income and you are FREE. Free to quit your job, free to live a life you want to live, free to travel and spend time with the people you love. I don’t know about you, but that sounds like a life I would like to live.
Believe it or not, that kind of life isn’t a pipe dream, and it can be achieved by people like you any me. All it takes is a little financial education, which most of us for some reason were never really taught in schools or by our parents.
What is financial education? Its learning how to use money, and not letting it use you. Its reading book after book, its emulating successful people. Reading this blog, is a form of financial education. Its even surrounding yourself by like minded individuals on this forum and blog, which is crucial for people who want to escape the rat race. Lastly, Its NOT participating in pseudo, multi-level marketing “businesses.”
Remember, there is a lot you are going to have to learn, and even unlearn. “The pain of change is forgotten, when the benefits of change are realized.” We have to unlearn a lot of information like, going to school, and getting a good stable job. Which may not be an easy pill to swallow. This old information is still good for some, but not for those who choose the life of an entrepreneur.
Thats why I believe passive income is greater that net worth. Net worth is simply an arbitrary number that makes you feel good. Passive monthly income gives you freedom, flexibility and cash in your pocket every month.
In the next few blogs and articles I am going to discuss different types of ways to generate passive income. I’m looking forward hearing from new readers! Send me your feedback and comments. I’d love to get a discussion going for those ready to escape the rat race!