Is Passive Income Really a Thing?
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- Опубликовано: 30 сен 2024
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Who wouldn't want to make money doing nothing? Passive income is possible, but there are some mighty thick strings attached.
Two Cents is hosted by Philip Olson, CFP® and Julia Lorenz-Olson, AFC®
Directors: Katie Graham & Andrew Matthews
Written by: Julia Lorenz-Olson, AFC®
Executive Producer: Amanda Fox
Produced by: Katie Graham
Edited & Animated by: Dano Johnson
Fact checker: Yvonne McGreevy
Executive in Charge for PBS: Maribel Lopez
Director of Programming for PBS: Gabrielle Ewing
Assistant Director of Programming for PBS: John Campbell
Images by: Shutterstock
Music by: APM
Two Cents is a production of Spotzen for PBS Digital Studios
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I'm just starting to invest for the first time. I’ve been hearing mixed opinions, and I’m starting to wonder: does asset allocation even matter early on? Especially with ETFs and index funds tracking the broad market, I've heard they can include underperforming stocks that might drag down overall returns. Am I overthinking this, or should I be more selective?
I’m nearing retirement myself, and I had similar concerns. I started investing later than most, and just relying on ETF compounding wasn’t cutting it for me either. After working with a financial advisor, I managed to restructure my investments and am now on track to retire with around $5 million. If I hadn’t sought advice, I doubt I’d be as confident in my plan right now.
I’m in a similar boat, trying to figure out the best approach for my portfolio. How did you find your advisor? I feel like I need that kind of guidance too
I usually steer clear of recommending specific people because financial needs are so personal. But I can say that working with Emily Ava Milligan has made a world of difference for me. I noticed her strategies are tailored to fit personal goals and make sense for different needs. It might be worth exploring to see if her approach resonates with you
Thanks for that. I did a quick search and found her page. I was able to email so I sent over a few questions to get more info. Appreciate you sharing
Usually when I hear the term “passive income,” it’s from someone trying to sell their course on passive income. More cringe is that the course is about how to sell a course on passive income.
So an MLM on courses about passive income.
Well, not really. MLMs are hard because you have to sucker friends and family in to buy/sell FOR YOU. These days, social media algorithms do the pushing for you for the engagement.
@@KafshakTashtakexactly
Even if someone is born in filthy-rich family, he still has to convince his parents to not give the wealth to someone else, so even in this case it's not passive income 🤣
There's no 100% passive income, but there are partially passive incomes, e.g. scalable businesses (like internet-based business which can scale to whole Earth), or a great book/song/YT channel (if succeeds, it's much less work per $ than in other businesses - sadly, very few succeed in those areas).
love the animations in this video, ah, the loop the loop way of how to get rich....the funky ponzi of modern day....I guess most big wins are more or less already decided at birth...
its just hard to accept (as after finding and reading more and more about these folks...either there is a not so known start up fund or their DNA of parents/grandparents in association with connections is like one of a kind and of course there is luck and if they are an industry or industry sub category creator which of course is a bunch of factors - aka the era of the economy ) unless a lucky lottery winner although without much foundation they burn out on the cash in a few years so not exactly castle goodyearS
Biggest lesson i learnt in 2023 in the stock market is that nobody knows what is going to happen next, so practice some humility and low a strategy with a long term edge.
Nobody knows anything; You need to create your own process, manage risk, and stick to the plan, through thick or thin, While also continuously learning from mistakes and improving.
Uncertainty... it took me 5 years to stop trying to predict what bout to happen in market based on charts studying, cause you never know. not having a mentor cost me 5 years of pain I learn to go we’re the market is wanting to go and keep it simple with discipline.
Could you kindly elaborate on the advisor's background and qualifications?
“NICOLE ANASTASIA PLUMLEE’’ is the licensed fiduciary I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.
Just ran an online search on her name and came across her websiite; pretty well educated. thank you for sharing.
Rule 8 indicates you don't need a high IQ to be a good investor, just 2 qualities, self discipline and a lot of patience. Investing is mostly about behavioral psychology. How can I generate more income to retire with at least $3m for long term care?
We share common goal, making sure you are ready for your later years is very important. That's why passive investing works, low costs, better diversification and it enables people to overcome their behavioural bias especially if they engage professional help.
It's unfortunate most people don't have such information. I don't really blame people who panic. Lack of information can be a big hurdle. I've been making more than $30k passively by just investing through an advisor, and I don't have to do much work. Doesn't matter if the economy is misbehaving; great wealth managers will always make returns.
I've been looking to get one, but have been kind of relaxed about it. Could you recommend your advis0r? I'll be happy to use some help
Vivian Jean Wilhelm is the licensed advisor I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment
Thanks for sharing, I just looked her up on the web and I would say she really has an impressive background in investing. I will write her an e-mail shortly.
All the TikTokers are raging that this video exists. They want to tell you how to make passive income by signing up for their courses 😆
That’s their passive income. You paying your money for their courses.
I have never signed up for one of these online courses from influencers, and I’m confident I’m not missing out.
Does ANYONE know a single person who has purchased classes like this and benefitted? Ever?
@@steverogers7601 100% correct
@@JoeCalevroII 0% success rate
On a serious note, this single video is more informative and accurate than 95% of the financial tiktoks/reels/shorts made by other creators. Thanks Two Cents team for creating great content!
Haha. True, but it I don't see it as great. Retired at 33. 😂
@bob1234881 Retired from doing what exactly?
Instagram and TikTok never were useful, why people talk like that?
@@bob1234881I wouldn't call living in your parents basement retired
@@djhero0071 I'm gonna guess tech. They make a lot of money right from the get-go, can start young (no college degree required), often dislike their jobs, and the FIRE (early retirement) movement is pretty popular with them. One of my best friends saved like 75% of his big ass tech salary before leaving
You need to get passive income the old fashioned way: inheritance.
That's a one-off lump sum. 😀
@@bob1234881 No, you just invest that into dividends or whatnot.
@@bob1234881interest from having a big chunk of money from said inheritance gives you passive income
@@bob1234881 not if you have enough elderly relatives!
All of the options listed in the video suddenly become feasible if you inherit a few millions
I will be forever grateful to you, you changed my entire life and I will continue to preach on your behalf for the whole world to hear you saved me from huge financial debt with just a small investment, thank you Carla Koren.
I'm surprised that you just mentioned Carla Koren here. I met her at a conference in 2018 and we have been working together ever since.
The very first time we tried, we invested $1400 and after a week, we received $5230. That really helped us a lot to pay up our bills.
I'm new at this, please how can I reach her?
You trade with Carla Koren too? Wow that woman has been a blessing to me and my family.
Initially I was skeptical, until I decided to try. It’s huge returns is awesome! I can’t say much.
You definitely have my sub. This content is next level. For me Unimantic was the turning point. Please keep doing what you do and keep being you, love it.
Thank you for exposing the influencers selling courses disguised as “financial freedom”
You're only as good as the decisions you make today with the money you have. To me, that is what passive income is about. This time last year I considered getting into stocks without much knowledge and decided to have a consultation with a fiduciary, and it was incredibly insightful. One year and a couple of months in, and I'm almost debt free. I truly cannot stress enough how helpful experts in this field are!
To be honest, I've had a hard time grasping the basics. What insights did you gain, and how are you doing it?
It’s not rocket science. As I said previously, I got into ETFs, index funds, REITs, and some cryptocurrencies myself but wasn't getting the results I wanted the first couple of months. Got tired of taking losses and decided to seek mentorship from Jonas Herman, a certified fiduciary who helps oversee my investments in ways that have made me good roi. Now I sit back and reinvest at intervals while I focus on my 9-5.
Sounds like I need help so bad. To me, investing is not worth it and I know that's the same mindset holding me back from taking a step forward in my finance. I guess I'm just scared since I'm green to it.
People often mistake hubris for actual knowledge when it comes to money and I don't even blame them because there's an influx of false info on the internet today. Unfortunately, it hampers rational decision making. He is one of the bright ones, providing me with a great deal. Indepth investment strategies are just one of the many components.
@@Roymysterio I'm 44 and I hope it's not too late for me to start. How can I learn more about his service?
This video indicates you don't need a high IQ to be a good investor, just 2 qualities, self discipline and a lot of patience. Investing is mostly about behavioral psychology. How can I generate more income to retire with at least $3m for long term care?
@Shultz4334 It's unfortunate most people don't have such information. I don't really blame people who panic. Lack of information can be a big hurdle. I've been making more than $45k passively by just investing through an advisor, and I don't have to do much work. Doesn't matter if the economy is misbehaving; great wealth managers will always make returns.
@Shultz4334 It's unfortunate most people don't have such information. I don't really blame people who panic. Lack of information can be a big hurdle. I've been making more than $45k passively by just investing through an advisor, and I don't have to do much work. Doesn't matter if the economy is misbehaving; great wealth managers will always make returns.
It's unfortunate most people don't have such information. I don't really blame people who panic. Lack of information can be a big hurdle. I've been making more than $45k passively by just investing through an advisor, and I don't have to do much work. Doesn't matter if the economy is misbehaving, great wealth managers will always make returns.
@@Curbalnk I've been looking to get one, but have been kind of relaxed about it. Could you recommend your advis0r? I'll be happy to use some help.
I've experimented with a few over the past years, but I've stuck with the popularly ‘’Jennifer Leigh Hickman” for about five years now, and her performance has been consistently impressive. She’s quite known in her field, look her up..
You definitely have my sub. This content is next level. For me Unimantic was the turning point. Please keep doing what you do and keep being you, love it.
I read a story about that one guy who ate nothing but ramen to save up a million dollars and then once he hit that goal got stomach cancer.
Jesus that’s sad, do you have a link to the story?
Gahhhdamn
Sounds like an urban myth, but there is a great message there!
@@colinrussell2017you’re right, in fact there are more people who died from only eating instant ramen but no money saved 😅
@@masterof2d926he made it the f up
My grandmother, 92, worked as a school teacher, retired at 52, and has been collecting from a pension longer than she was actually teaching! 🤯
That's the way to really profit off of the system.
Well, we’re never going to get to retire.
She has peobably start working at age 16 not 26
@@redaalami6201Nope, basic math - she probably started at 22, right out of college, 30yrs teaching to age 52, has lived 40yrs in retirement. Most union jobs, you max out the pension formula at 20, 25, or 30yrs. Some now require you to be a certain age to collect, but not then/not always.
Many folks put in their 20, then just do a private/consulting version of their old public job for extra cash.
@@matthewcaldwell8100Go look into public-sector jobs, or highly-unionized industries. Lower salary in some fields, but more reliable work, and you still get stuff like pensions & free/cheap health insurance.
Most places will train you, some even pay for your education (my job paid for a Masters in CS).
The crypto market has been unfavorable for months and I keep losing my money selling-off during dips, I'm very scared of holding right now, how do you guys still make so much….?
Any info on how i can liaise with her, i'm new at this
Extraordinary is the right word for expert Alice she,s experienced as a trader and so unique..
Exactly and many of us don't know where to invest our money so we invest it on wrong places and to the wrong people
Despite all the financial struggles i and my family faced, everything is finally falling into place! $47,000 weekly profit and riches I'll always praise the Lord!!!
am making 15%-20% every week from my investment. unlike I can say for my IRA which has just been trudging along
*I didn't become financially independent until I was in my late 40's, and I'm still in my 40's. In addition to having purchased my second home and earning money on a monthly basis through passive income, I've also achieved three out of five goals. I just hope this inspires someone to realize that it doesn't matter if you don't have any of these things yet, you can start today no matter your age. Change your future by investing! I made a rather big decision by investing in the financial market.*
Investing in many sources of income that are independent on government paychecks is the prudent thing that everyone should be thinking about right now, especially given the global economic crisis. Stocks, forex, and digital currencies are still good investments at this time.
Sure, investing is essential for maintaining your financial stability, but making any kind of legitimate investment without the correct advice of a professional can result in a significant loss as well.
It's really not easy investing or trading the financial market. I read a lot of books, tried to study, watch some tutorial videos, did a little demo before funding my account and I still lost a lot. The financial market could be very tricky
I have lost a couple of dollars trying to trade myself, it's like the market is being manupulated. I do well on demo but once I switch to live, everything 'll start going left.
Beginner traders sometimes make the error of trading on their own without the right guidance or knowledge, and they frequently come to regret it. You need a mentor and an expert to help you trade as a newbie.
I worked in residential property management for 10 years, and I will never, never own a rental property. I know too much.
property tax too expensive? maintenance too high?
No dude tenants are a nightmare
I lost my 20 unit apartment in the eviction moratorium during covid. Tenants just stopped paying rent, they lost in the end. since i was forced to sell to a profit driven corporation before i was too deep underwater in the property.
The did free up a lot of time to work on my plumbing company that is thriving now.
4 employees, not including me. Grossed 5.8 million last year.
@@Plumber1111was just thinking about a guy I met who is doing REALLY well for himself. Owns a company that just moves dirt and does nothing else.
I love it when I hear about “regular work” jobs raking it in over anyone with an MBA.
@@hulkhoganwwfyep, tenants are scum. They dont care.
If you are not in the financial market space right now, you are making a huge mistake. I understand that it could be due to ignorance, but if you want to make your money work for you...prevent inflation
Interesting, This is superb! Information, as a noob it gets quite difficult to handle all of this and staying informed is a major cause, how do you go about this are you a pro Investor?
I feel Investors should exercise caution with their exposure and.exercise caution when considering new investments, particularly during periods of inflation. It is advisable to seek guidance from a professional or a licensed expert in order to navigate this recession and achieve potential high yields
Prioritizing effective personal finance management holds greater significance than the sheer amount saved, irrespective of income source. Consulting a certified financial advisor can offer tailored strategies to optimize financial results by reducing expenses and enhancing income, regardless of whether it's earned through employment or investments.
Brian Humphery Services was my hope during the 'bear summer' last year. I made so many mistakes but also learned so much from it, and of course from Brian.
He is really a good investment advisor. Was privileged to attend some of his seminars.that's how I started my own crypto investment
“If I knew an easy way to make passive income, do you think I’d be working here?!?!?”
Just buy my sun praise based course and you too could achieve massive unearned wealth.
You're looking at it the wrong way
Ive always said this, when i hear "create a ytube channel" as advice for passive income, like creating content its very hard and time consuming isnt 100% passive at all
Every passive income requires work up front. But the idea is that you do that first and then it keeps going
Create a ytube channel may not be passive but still better than full time job, you dont have to deal with other people bullshit, you work your own hours from anywhere you want and you dont have a fucking boss telling you what to do, when to eat, when to go to bathroom, what clothes to wear. All that makes me feel like slave.
This video is a passive income: Uploaded once and wait the view go up charge RUclips and do not have to due much .
I'm interested in investing, but I'm not sure where to start. Do you have any advice or contacts who can help me out?
Investing can be complex, so it's smart to get professional guidance when building your financial portfolio.
It's a great idea to have a conversation with financial advisors like Naomi Dean to reshape your portfolio.
I spread out my $25k portfolio across various markets to diversify my investments.
That's awesome! I ended up making a net profit of about $115k by investing in high dividend yield stocks, ETFs, and equity.
Naomi Dean stands out from other brokers because of her realistic approach, unlike those who often set unattainable targets and fail to deliver. She's truly unique!
Passive income do exist you need a good financial plan and investment plans to earn from it. Like for me I earn through stocks and crypto, a brokerage firm helps me out, limiting my time in the market and risk. I’m favored financially with Bitcoin ETFs approval, Thank you buddy. $12,000 monthly profit regardless of how bad it gets on the economy.
Same here, I believe the Bitcoin ETFs approval will be life changing opportunity for us, with my current portfolio made from my investments with my personal financial advisor 1 totally agree with you
YES!!! That's exactly her name ( Audrey lauren) so many people have recommended highly about her and am just starting with her 😊 from Brisbane Australia 🇦🇺
I’m a long term investor, I withdrew my profits of over $61,000 during the COVID 19 pandemic ….
I’m a retiree and even though I started investing late in life , having other means of money apart from ur salary is very important and will do you a lot of good 😊
She is my family’ personal Broker and also a personal Broker to many families in the United States, she is a licensed broker and a FINRA AGENT in the United States…
Everyone is advocating investing for passive income, but with a 70-hour workweek and limited financial knowledge, how can I manage it? RUclips videos say "BUY, BUY," but when and how do I sell for profit at the right time?
I also think everyone needs a Margin of Safety in their portfolios and just remember, It's time in the market versus timing the market.
Well all i know is that you cannot go wrong taking profit at near high. No one ever went broke taking a 10% loss. It's best if you consult with a fiduciary advisor to get informed buying & selling decisions
Working with a financial advisor has been a game-changer for me. They provided invaluable insights and tailored strategies that aligned perfectly with my risk tolerance and financial objectives. With their support, I've seen significant growth in my investments and gained confidence in my financial future.
I've been considering getting one, but haven't been proactive about it. Can you recommend your advisor? I could really use some assistance.
I'm cautious about giving specific recommendations as everyone's situation varies. Consider independent financial advisors like “Sharon Lynne Hart” I've worked with her for 9 years and highly recommend her. Check if she meets your criteria.
Takeaways:
- Passive income is defined as "money earned from an enterprise with little or no ongoing effort."
- It's important to distinguish passive income from an investment's growth in value, which is an unrealized gain.
- Even for successful creators, the work required can be extensive, and many express feelings of burnout.
- Starting a business that eventually runs itself also requires significant upfront effort and is not truly passive.
- Defined Benefit Plans, or pensions, can provide a reliable passive income stream, but they are becoming less common, especially in the private sector.
- Rental properties can generate income, but they also come with various overhead expenses and responsibilities.
- Dividend-paying stocks and bonds can provide a passive income stream, but the yields are often relatively low.
Passive income I think is just a marketing term. "Passive Income" always needs some kind of work to make it happen.
The formula is basically you need a lot of money or a lot of time - ideally both. Warren Buffett makes $1B in dividends from Coca-cola - 30+ years after he bought it. And that cost him $1B at the time.
@@epbrown01 Time is the most important component and it's also the most plentiful thing any of us have. Now whether we're using our time productively or not... different question.
@@BTrain-is8chMaybe when we are young ( 20s) it is the most plentiful thing we have, but in fact it is the opposite in the grand scheme of things:
It is a constantly depleting, non renewable resource. That's what makes it so valuable. You can lose money and earn money back, but you'll never get back time.
Sorry for any existential dread I may have caused🕑💀
@@epbrown01 ok I’ll take the lot of time path, started in my early 40s
Stayed the course, these stocks provide A LOT of passive income via dividends
XOM, MO, CSCO, SYY, ABBV, PNC, CVX, PPL, NEE, T, VZ, IBM, UPS, HSY, PSTL, NLY, CSL, HESM, RSG, and others, not to mention a large collection of preferred stock purchased well under the $25 call price paying 5-6% yields
Large collections of CDs ar 5-5.4% also provide nice “passive income”
And treasury bills too .., 2 minutes work make 50x your bank interest
Lots options
@@BTrain-is8ch really depends on what being productive means to you. I you like just spending time with your children or partner even if you aren't getting anything done is that productive.
You work for 40yrs to have $1M in your
retirement, meanwhile some people are putting just $10K in a meme coin from just few months ago and now they are multimillionaires.
I want to compliment you, you have said it all. I am a little business owner and I really want to expand my business to the next level by making myself an investor but I really don't know how to go about it..
imagine investing in Btcoin earlier.... You could have been a multi millionaire precently
@@Bireshprema You are right. Been thinking of going into gold and cyptocurrency
Assets that can make you rich
*FX
*Btcoin
*Stocks
*Gold
*Real estate
You’re right but a lot of people remain poor due to ignorance
It would be nice if landlords didn't treat their investment residences as "passive income" without treating ithem like a business that requires maintenace and has costs.
Fix the goddamned tap!!!
Couldn’t agree more, some landlords have the worst kept properties I’ve ever seen because they simply don’t care as long as it rents out, I work on them from time to time (house
Painter/handyman) and the landlords never want to spend the $ to have them properly maintained, sadly the poorest maintained asset is a rental property…
My passive income is the stray quarters I find near the vending machine at work.
Gambling, in my mind, is the "passive income" scam that is hurting people the most. Little effort with huge promises of rewards? Sounds like the very definition. I think we aren't talking enough about gambling right a lot of younger people are tip toeing with it in very volatile/manipulated stocks and sports betting.
Sports betting and video game betting like gun skins are bad as well
@@TheScrubmuffin69 those are forms of gambling
Plenty of people are abundantly clear about the fact that stock picking is essentially gambling. People trying to ride a GameStop/AMC wave deserve what they get.
I mean gambling is a pretty good "passive income" but only when the game is rigged in your favor. It is bad to be the person buying lottery tickets but great to be the person selling them.
Society is so morally decayed that gambling is legalized, in order to increase tax revenue. 😏
Pension, interest, dividends, annuity etc are passive income.
Managing rental property is not passive income.
Yeah. It is a real work. I have heard some realtors acknowledging changing toilets by themselves for the rental properties they own.
I've kept much of my savings in cash for safety, but I'm unsure if it's right for retirement. Contemplating investing $400K in stocks, as I've heard investors can profit in tough times. Unsure about my next move.
Yeah, I’m also closing in on retirement, and I have benefitted much from using a financial advisor. I didn’t really start early, so I knew the compound interest of index fund investing would not work for me. Funny how I pulled in more profit than some of my peers who have been investing for many years.
Please can you leave the info of your lnvestment advsor here? I’m in dire need for one
What a share!! it was easy to find your adviser. Did my due diligence on her before scheduling a phone call with her. She seems proficient considering her résumé.
Scam bots unite! ✊️
DRDCX
I miss the mustache so much 😭
I thought he was another person
@@matteosaottini930 ikr lmao. this is so confusing for a long viewer who got a hiatus. I was thinking that they hired another people for their video lol
I think she looks better without it.
Great video.
If a concept sounds too good to be true, it probably is.
Be cautious out there, slow & steady tends to win in the end.
There is another side to this. There are concepts that sound too good to be true simply because they are morally bankrupt and doing them involves taking advantage of others.
Also true, thanks!
It's a misnomer.
You want to have income that can grow beyond the linear dependence on the time you spend.
Dividends and royalties are as passive as you can get.
Of course building up the investment for a substantial dividend is a lot of work. As is creating content and marketing it for the royalties.
Building a business and profiting from the scale of employees is also a answer to what we are looking for.
Nearly everyone that I’ve ever heard claiming passive income ACTUALLY means buy real estate and then be a neglectful landlord. Terrible business model.
I was advised to diversify my portfolio among several assets such as stocks and bonds since this can protect my portfolio for retirement. I'm seeking to invest $200K across markets but don't know where to start.
I thought about investing in the real estate market, I heard that people make millions , but I lack good knowledge and a strategy to outperform the market and generate good yields. I have $460,000 but it's hard to bite the bullet and do it. Money is hard to come by
This seems like the worst period.Even the markets are very unpredictable.started investing recently when the market prices were a bit high,today i am more than 60% down
I began my investment journey at the age of 38, primarily through hard work and dedication. Now at the age of 40, I am thrilled to share that my passive income exceeded $100k in a single year for the first time. This success reinforces the importance of the advicmonth e mentioned earlier. It is not about achieving quick wealth, but rather ensuring long-term financial prosperity.
Fantastic! Can you share more details?
was guided tho..Julia Hope Marble. walked me through the ropes majestically i'ts my ultimate pleasure.
I want to say thank you to the guy in the comments who recommended Unimantic to me. You've been very helpful. Thank you!
You overlooked the route most people who have passive income took: choose rich parents. The children of the 1% typically have trust funds that provide passive income such that they need never work. Under today’s tax laws, the children of wealthy parents can be given as much as ten million dollars completely tax free between their birth and turning 18, and there are all sorts of specialized legal entities (eg, Walton trusts, intentionally defective trusts, family limited partnerships) that exist so that rich people can avoid paying inheritance taxes, so that their kids don’t have to work.
Good for them! Don't be envious -- it's not attractive.
I think the point of the video was how normies have a hard time with passive income, and battling Tiktoker scams. But ya. I get it.
@@LG123ABCcope
@@LG123ABC The paragraph is just a list of facts. Can you point out which sentence is even an opinion? None of the sentences are opinions, therefore, saying they are jealous is a delusion and says more about you than them.
What's very interesting is how financial tools have been created by rich people in order to stop the "rags to riches to rags" that was endemic with the 19th and early 20th century robber barons. The Vanderbilts come to mind as the most famous of rags to riches to rags. Things like tax-free inheritance/trust funds, step-up loans from banks against assets, and pass-through corporations/non-profit corporations are all very effective tools to create perpetual tax-free zones for the children of the wealthy.
To show just how effective the rich are in not paying taxes, half of the US's billionaires received their full Covid stimulus checks. And even the unavoidable sales tax for people like you and me can be avoided by rich people using a variety of perfectly legal financial tools. Meanwhile, most US citizens pay about half their income into taxes if you include sales taxes, payroll taxes, in addition to income taxes. My effective tax rate, for instance, is 56%. Warren Buffet's effective tax rate, as stated by himself, is about 12%.
Honestly, I don't understand why you're discussing these dubious schemes. There are plenty of options like Unimantic and similar ones that are fast and profitable.
so basically in today's economy it is extremely difficult to live off of passive income especially if you are young unless you are from a family in the 1%. And if you're not lucky enough you can only do so when you're old and have managed to grow your pension fund high enough after working for 50 years or smth
In any economy! Value comes from labor x time, so you'd have to maximize one or the other, ideally both. Even an inheritance just means someone else's labor, in the past.
Correct! "If you ain't rich, then you ain't sheet." --J.P.
@@mandisawWrong. I only care about passive income because Americans live in an economic system where access to basic necessities like shelter and healthcare are deliberately and perniciously withheld/restricted to extract the maximum amount of wealth from the plebs.
I've only seen the best interest rates from investments in the copy trading market, like Eledator, for example.
Private sector Union employee here with a Defined Benefit plan(Pension), and a 401K with a 6% match. Definitely looking forward to retirement!
Lemme guess, union? 💪 Public & pensioned over here 😁
As an active duty Army officer and real estate investor with a dozen residential rentals, I can say that my military pension pays more and is much more passive then my rentals. You pay everything up front with 20 years of service to the pension. After that, it is adjusted to increase at a rate equal to inflation every year and is 100% passive. No matter what, even with an accountant, attorney, and property manager, my rentals will never be totally passive. They are also likely to never exceed my net cash flow from my pension. More work and less money from the rentals, but yet nobody talks about finding a good 9-5 job, working for 20-30 years and retiring. You can't sell a course on that and it is not a get rich quick scheme so people don't want to hear it.
Bravo! Well said!! 👏🏿
And now with the blended retirement it’s such a good deal. You get a little less in pension but that 5% match and the $22k we can put in every year is a lot! I’m on track to have 3million by 60 PLUS the pension which would start much sooner!
It's also not guaranteed anymore - a lot of people search unsuccessfully for years to find that good 9 to 5 permanent job, and private companies increasingly don't want to keep anyone around that long.
Unfortunately the Military is considered to be the last employer in America that offers retirement pensions.
Stock your IRAs if you're offered em, folks
@@gino14 If you joined after December 31, 2017 you no longer receive a pension
Happy to live in a country where pensions very much aren’t a thing of the past. Wasn’t aware workers rights were so deteriorated in the US.
America had an ocean separating it of the world's largest communist nation. So America didn't get a taste of civilization.
Hah. Workers having rights! That's a good joke.
This is spot on. I never could figure out why owning a rental is called "Passive" income. Whoever says that must not own a rental property.
Or owned a business. When you're the boss, there is no "clocking-in/out" 😅
@@mandisaw *owner, when you are the owner. A boss has to "clocking-in/out".
@@adiahheart9413 True, true - I conflated the two :)
I'm favoured, $22K every week! I can now give back to the locals in my community and also support God's work and the church. God bless America.
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大家都這樣“複製”，“RUclips”令人沮喪
Tell her that I referred you 🙏🏿🙏🏿
"I'm favoured" 😂 we can tell it's a scam when you say that
guys everyone in this thread is a scammer don't listen to them
Hallelujah!!!! The daily jesus devotional has been a huge part of my transformation, God is good 🙌🏻🙌🏻🙌🏻🙌🏻🙌🏻was owning a loan of $47,000 to the bank for my son's brain surgery (David), Now I'm no longer in debt after I invested $8,000 and got my payout of m $270,500 every months,God bless Christy Fiore 🇺🇸🇺🇸🇺🇸..
Hello!! how do you make such monthly, I’m a born Christian and sometimes I feel so down of myself 😭 because of low finance but I still believe God
Hi that's good you have idea &share to those who deserve it that's great god bless🙏🙏
She's a licensed broker here in the states🇺🇸 and finance advisor.
After I raised up to 525k trading with her I bought a new House and a car here in the states🇺🇸🇺🇸 also paid for my son's surgery….Glory to God, shalom.
+1301
Step 1: Have capital.
Step 2: Make your money breed for you.
Also, starting a business is not passive income because it takes work, but a pension does count as passive income? Do you guys want to do a second draft of that one?
Business requires ongoing labor, until/unless you can fully make it self-sustaining (even then, you'll need to strategize). Pension is more hands-off, you just do your normal job, then collect a monthly check at the end.
Passive income is real.
You just have to be a millionaire, so you can buy bonds or dividend stocks enough to have a median wage salary. Since average dividend stocks are around 4% and median salary is 60K, you would need to have 1.5 million to invest in a combo of dividend stocks, bonds, or any other instrument that automatically disburses ROI's in to your account.
So that pretty much means tough luck for 99% of the US, and 95% of those looking for "passive income".
Anything else is NOT passive income, and requires a lot of work.
Simply put, an indexed dividend etf is the best "passive income" out there, with the most ROI/time spent.
1 minute to make the account, 10 seconds to transfer money and set up re-occuring deposit, 20 seconds to set up automatic etf investment and dividend reinvestment
You tell me something else that could grow to millions of dollars in 30 years time, and end up paying you a $50K dividend every year, while only having one time.... time investment of 1 minute 30 seconds. None. That's what.
In short, you work until death. The end.
Nah, they left one out: Intellectually Property. Spend a year writing about a kid named… Gary Putter, an orphan who goes to a magic school and has adventures. It becomes a hit, you make billions, done. (Set some money aside for lawyers.) 😂
That's what you voted for.
@epbrown... if only it were that easy, son. 😂 Without coin, corporate connections, crews, clout, computer code, committed communities, and lofty opportunities... nothing significant can nor will ever occur. That's just reality on a planet of eight-billion.
Reflection is truly key.
🐲✨🐲✨🐲✨
"Before I start, I must see my end. Destination known, my mind's journey now begins. Upon my chariot, heart and soul's fate revealed. In time, all points converge, hope's strength resteeled. But to earn final peace at the universe's endless refrain, we must see all in nothingness... before we start again."
🐲✨🐲✨🐲✨
--Diamond Dragons (book I)
Ok doomer
I thank my parents all the time for investing in real estate early in the game. Now we have several commercial and apartment rental complexes that created generational wealth and passive income. They also taught us the value of frugality, and using money to make money. A lot of the topics discussed in Two Cents are fundamental in building wealth, hence I always look forward to your videos and appreciate all your efforts in creating such great content.
"Passive Income" is an Internal Revenue Service term. There are different categories of income. Passive Income, Earned Income, Unearned Income etc. They are taxed differently. It is not an accurate description of how income is earned. Hamburger is not ham. Hot dogs are not dogs. Blue moons are not blue.
Baby oil is not made from babies.
Well folks, this is the system that we all one way or a another accept... Record profits for the companies, massive stock price increase and capital gains, but no pensions, low incomes and high housing prices. 🎉🎉❤
I love the pension explanation about how annuities pay 20+25th of their value, so simple
i get .25 a share from apple if i wanted to get a replace my income i would need to have 14 million in apple stock
It is for some people. Especially in the entertainment industry. Jerry Seinfeld wakes up and makes coffee. By the time he walks to the mailbox he’s got several thousand dollar checks waiting for him for being in a show that ended 25 years ago.
Yeah, that case can be included in the examples they give at 7:37. Not very much replicable 🥴
What's the deal with residuals?
J "probably knew Epstein" Seinfeld.
Passive income that's impossible money coming out of nowhere only the U.S. Federal reserve is allowed to do that
Are you still just holding coins? Guys, what are you doing? Eledator has been around for almost a year!
There are a lot of crooks in the passive income space, but passive income is a real thing through stock investments. Ideally those investments go into something standard but boring (e.g. a mutual fund or ETF that mimics S&P500) and invested via a company that charges low fees (e.g. Vanguard).
It would be nice to see a video discussing strategies for attaining financial independence, rather than just implying it's all a scam. It's not, but the reality is that it isn't simple to attain and it may not be feasible for everyone. But even if not everyone can attain financial independence in the long run, everyone can benefit from applying the strategy to be more financially secure than they would have been otherwise.
Passive income from stocks requires having a _lot_ of spare cash that you can invest up front. I have a decent amount of stocks; I get just a few hundred dollars in dividends per _year._ Mostly stocks are just a good alternative to a savings account for retirement since over the long term they grow faster than the banks’ meager interest rates.
@@trevinbeattie4888there's not really anything bad about investing your money wisely rather than letting it sit in a bank. You're doing the right thing, hows the extra 12% you've gotten this year feeling?
@trevinbeattie4888
You are exactly right
I have over $2.4 million dollars worth of PepsiCo stock. It pays me less than $20k per year in dividends. No wage workers today will have that kind of money to invest in their whole life.
After all the taxes, rules, regulations, policies, fees, red tape, risks and requirements, it's almost like the system is fine-tuned to keep you from getting ahead or something.
It is. The rich don't want any competition.
I don’t think so. People put their own greed first and sabotage themselves.
It's your excuses that's stopping you.
@@handleyobusiness I agree but there's more to unpack on that... your statement is true if your enemy is laziness. I've worked in both white-collar and blue-collar sectors, down and dirty but also in high-skilled environments. Got the work ethic and drive to start a small business. The fight is real.
You'd have to have $500K to become an "accredited" investor status (the cool kids club to invest in cool kid things). I get taxed when I make money; I get taxed when I lose money. I can work my ass off all my life and it won't be enough; I can make investments with that money and still not have enough. I do the "good boy" things to get my credit score up only for that not to matter at all. Want to start a business? You're already -$7,000 in yearly taxes for being "self-employed" now. It's up to us to make up and "try harder" whenever we get nickeled and dimed with silent penalties and fines.
So my point is: is that really on me? Every time someone can get ahead, they'll find a way to stick us so that we don't get ahead. If you aren't zeroed-out at the end of the day, they will and can find a way to make sure you are. _"If you aren't in debt up to your eyeballs then you ain't livin'!"_ There's a reason why more and more people need to take more time and more jobs because maintaining a standard of living creeps up on us, even people that are frugal. The same can be applied to taxes on top of taxes on top of more taxes and, oh hey, here's a new tax this year to put on the pile, sorry bub -- and we let it happen to us so much that it is slowly sinking us into a larger-picture state of misery we as a whole are experiencing.
tl;dr: educating myself about investing and stocks and whatnot over the last year or so, learning a lot. No excuses, you're right. But that action of investing is penalized even if I'm doing everything right. And I'm saying "that sucks." lol (Why bother trying to go the extra mile and succeed when it doesn't pay to put that effort in?)
"Sir, this is a Wendy's." 😬
if you managed to buy property back when it was affortdable, you can have kinda passive-ish income. in most other cases its a pipedream 😂
I appreciate your videos a lot not only the info but your editors,producers and crew sure know how to animate this in a way that is entertaining and simple to understand❤❤❤
Pensions and dividends are really the only two kinds of truly passive income.
Honestly, I don't understand why you're discussing these dubious schemes. There are plenty of options like Unimantic and similar ones that are fast and profitable.
This is a very good summary. Passive income comes from making solid income, living below your means, and investing. Or working your ass off. I'm too lazy for that.
for Canadians if you haven't already started, please use your TFSA to buy some financial products like stocks or ETFs. lots can pay more then 2-5% yield div and its tax free to reinvest! so it can compound and really help you get to those financial goals over the long term. good luck!
That's right! I live off dividends from a covered call ETF (HYLD to be precise) which has between 12.5% and 13% yield. I dunno where these people take their 2% to 5% yield, there's waaaay better options (no pun intended).
I'm that someone who's lucky enough to start a business during my uni years, got it to do quite well then continued it after graduation, then covid hits. That's when I earn quite a bit.
I'm 27, with (I believe, if all go well) enough money for the rest of my life. Even then I call myself semi-retired, I'm still running the business but not actively expanding because I enjoy doing something.
But that's because I'm really frugal and debtless. If you're thinking to have enough passive income to live a luxurious life like what those gurus promise you, you have to go to a fantasy world I'd say, or be really really lucky.
I mean, passive income does exist... you just need to put a lot of money to make a noticeable income from it.
Yeah I'm getting 20$ a month in passive income from my dividend paying etf lol. Not exactly liveable 😂😂
I missed my true calling to be a bankster... #TDBank🌎💘💰
German spam for the 1st two comments 😅. Here is a real person saying thank you for your content. Always very informative and helpful.
Report it.
@@krzysztofkonopka5559 1st thing I did 😅
You want passive income? You need money first to invest that will gain interest lol
4:05 In some cases, you can even "buy time" in a pension plan, replacing that time spent with cash earned from other jobs.
Hmm interesting. Thanks for sharing
@@ladylove34 Sure. Something similar happened to a relative of mine; they worked in a school cafeteria, so they were a state employee. But then they took the cafeteria private. My relative was mostly vested in the state pension, and paid for the rest of the time needed to get all the way vested.
if you do some caculations, passive income, if i understood that phrase correctly, only work for the already rich, large amount of money/assets would generate enough money as income for a family to live regardless of how low the return is after you deduct taxes and inflation, but it probabaly don't work for anyone that people's trying to sell this tactic to
Thanks for bringing awareness!
Low cost Index/ETFs can pay monthly stipends without limiting the purchaser to dividend yielding companies (dividend yielding company index/etfs reduce investor market exposure unneccesarily).
Military veteran here. Last time I checked, the government no longer has the 20 yr pension commitment. Newer personnel get the Thrift Savings Plan (government 401k/IRA plan). Older personnel still get the pension (those who signed up before 2018/2019).
Military gets 40% instead of half pay plus TSP match
Gov't pensions have taken a beating in the fight to destroy unions/labor (which includes vets!). Some places with stronger unions fare better than the Feds, but it's still usually a better deal overall than private-sector, in terms of retirement.
The military as a career option is another matter, I'll leave that to folks with experience.
@@robertguidry2168 I just read up on it. It doesn't seem all that bad.
As of 2018 anyone joining the military falls under BRS (blended retirement system). The short version it changes your multiplier from 2.5% down to 2%. After a year they add in 1% to your TSP (not the roth TSP) with a match up to 5%. Yes I have skipped over big pieces, but that gives a summary. There is also added incentives such as a 12 year TIS multiplier for additional cash and other things as well. Yes the other person wrote it's 40% vs 50% with all things being equal at a 20 year service.
Common misconception is that the pension went away. It did not. It blended. Lots of legacy folks don't understand it and will spread misinformation about it instead of learning about it.
If you are not in the financial market space right now, you are making a huge mistake. I understand that it could be due to ignorance but if you want to make your money work for you...prevent inflation
Only passive income I know of is mutual funds. But even then, people might get caught up moving money from fund to fund too often.
No, a well diversified dividend portfolio without any garbage mutual funds is true passive income as well. 🥱
But really, it's not impossible. I earn an affiliate income passively. YES, I had to put in the work to get something valuable up and running, but now the income continues passively. Enough to not waste time by working for a boss. It's like writing a book that sells well, or recording an album that sells well. You'll always have to put in the work first, and make sure you create something valuable. YES, it's not easy, but: YES, it IS possible.
While I acknowledge the FIRE community is very lucky to combine financial education with goal setting and long term discipline/planning, I think the implication that it's similarly likely as winning the lottery is not correct. My chances of winning the lottery are close to nil (well, straight up nil because I don't play the lotto). I am FIRE, however, and I know at least 3 other successfully FIRE people. Structuring for passive income is definitely hard though, and yes it took choices the average person won't make.
Only 3 successful FIRE people?... So your basically saying it's not likely to work then? No lie, but I have actually met more lottery winners than people who achieved FIRE.
@@AK-47ISTHEWAYI'm financially independent because I was born to already wealthy people. It was a lottery win. Financial independence is only a goal when you know you live under a financial system that actively exploits you and doesn't care about your welfare.
2 kinds of income:
- What's made just in time (hourly/salary work)
- What's made ahead of time (royalties and value appreciation of investments)
Sure, there's allowances, but that's for chumps.
The only "real" passive income is royalties and residuals. Mariah Carey earns 2 million dollars yearly from "All I want for Christmas is you".
If you ain't rich to begin with, there is no possible way to become rich without corporate connections, crews, clout, computer code, control, committed communities, and lofty opportunities. Mariah C. had them *ALL*. It's as simple as that. No exceptions.
I was waiting for a run the numbers section where the dividends actually run the annuity option.
I have to say Julia is my celebrity finance crush.
Big thanks to the entire 2 cents team for putting out great content!
You guys are great. Thanks for making such an informative video 😊
Passive income does not mean free cash. It means putting some amount of up front work and create multiple streams of income that require limited attention. Investing in index funds, stocks with high divident yield, creating content, joining a startup with revenue share are all valid passive income streams.
Yeah this is it.
So you're telling me there's no easy money unless you were born rich or marry rich. Both too late for me.
Try to get adopted by rich parents. That's what i'm going to do.
Next video: "Is retirement really a thing?" in this same vein
I mean, I could retire now at 38 but will continue to work to help out my friend. So, yes but no?
Your expertise as financial planners is very evident in this video. One of the best you've ever done.
passive income and compound interest should go hand in hand, otherwise that income will not be able to keep up with inflation or present living expenses
Please do a video on the pros and cons of buying treasury bonds as an investment
2cent is the best financial channel ❤
I mean my retirement account is basically passive but I have to contribute.
Reading suggestion: The Simple Path to Wealth by JL Collins
I'm favoured, $50K every week! I can now give back to the locals in my communitv and also support God's work and the church.God bless America
How
..? Am a newbie in crypto investment, please can you guide me through on how you made profit?
A lot of people still make massive profit from the crypto market, all you really need is a relevant information and some professional advice.
Thanks to Mrs Deborah Davis.
She's a licensed broker here in the states
YES!!! That's exactly her name (Deborah Davis) so many people have recommended highly about her and am just starting with her 😊 from Brisbane Australia🇦🇺
Yes. You buy a property & open a business there.
That's funny 'cause I live off passive income, mostly rentals, It's easy! Just inherit it!
I love every time your episodes come up. Thanks for putting out this good info.
very good video tbh. kinda shallow, but a good basic summation of things! and i'm to the right of attilla the hun so i dont like complimenting pbs lol.
video doesnt mention the 4% rule directly, but yeah it says you can generally safely withdraw about 4%, inflation adjusted, of a given investment (mostly stock) portfolio. So you need a million $ just to clear 40k in annual inflation adjusted income by this measure. One good side effect though, is that in most cases using the 4% rule is conservative enough (since it needs to cover the worst cases) you will usually (not always!) end up with a significantly larger portfolio at the end of 30 years (the generally assumed "retirement" period of the 4% rule) than you started (that 1m could turn into 2 or 3m).
Right now of course you can earn a safe 5-5.5%, but we cant expect rates to remain this high.
$200 a month with all the hassle of owning a six figure property, paying taxes, managing tenants or a PMC, making or arranging repairs, worrying about damage, etc.
Easier to put $60k into a REIT index fund and just make 4% off that which is the same $200 a month. (That same $60k is a 20% down payment on a $300k property).
The beauty of the stock (reit or otherwise) is you can get started today and even if you can only do a couple hundred a month, preferably in a Roth… it’ll add up fast over a decade or two. And it’ll be intoxicating once you see free money hit your account and you’ll be motivated to grind and scrimp to save more.
And before anyone says “I can’t do $200/500/1000 a month”…. Well look at your car!