This term also refers to several other types of money that can be earned with little or no effort. A perfect example of this would be owning a property and renting it out. The rent money that you receive from your tenants is a form of passive income. Along with rent money, there are other ways to earn this type of income, the most common one right now being the internet entrepreneurial way.
The most usable information that can be found about this form of business is that you are able to earn money without having to spend the time to do to. Your time is valuable, and can be spent earning other sources of income; earning income passively is just another way of, well, making more money, easily. This source of income emanates from the fact that you don’t need to do work yourself. That work is replaced by automated systems that do the formulas, transactions, and cash flow processes for you, while you anything else.
Another way of looking at passive income is to think of it as an investment. You do have to do the initial work of setting it up and making the systems work for you, but once you complete this process, you are free to sit back and watch your handiwork actually go to work for you.
A great source of how something like this form of income works can be found in Tim Ferriss’ book The 4-Hour Work Week. The title even gives you a sense for what’s ahead, and that concept of working a little at the start to bring in more money later is replicated by the earning model.
