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It doesn’t matter how old, or how young you are, passive income streams are important because they simply give you the ability to create more freedom to live life on your terms.

Even though we are currently in an economic recession (that may last for at least one or two years), the reality is that you should still focus on creating as many passive income streams that you possibly can.

If you’re new to the concept of creating passive income streams, this article will provide you with an explanation of how to get started with creating passive income streams, maybe for the first time, so that you can have more control over your income and live a fulfilling life where you have more time and freedom.

Understanding Active Vs. Passive Income

Before I get started with answering the question of how many passive income streams you should focus on creating, it’s important to break down the difference between active income vs passive income.

Active income is income that you’ve earned from any type of activity that you are personally involved in. This could be your job, business, or any type of Enterprise where you need to invest some of your time every month.

The most common source of active income is earned income, or money that you earn from working in a job for a regular employer.

Unless you start with inherited money, you’re going to be like most investors who begin investing careers while working for somebody else. This is to be expected, but your goal should be to begin creating passive income streams as soon as possible so that one or more of those income streams can replace your earned income, giving you the ability to quit your job and focus on investing full-time.

Passive income is money that you earn regularly without having to do any ongoing work to maintain that income stream.

In today’s world, there are a wide variety of passive income streams that you can create. Some of the most common forms of passive income include interest income, or money that you earn from peer-to-peer lending, real estate crowdfunding, CDs, High-interest savings accounts, or possibly Fix and Flip debt deals.

You can also earn passive income from dividends, capital gains, royalties, and licensing but, by far my most favorite form of passive income is rental properties, specifically multi-family rental properties.

As a serious investor, your goal should be to get started with investing in multi-family rental properties, if you don’t have one property already in your portfolio.

Multi-family is without a doubt one of the best investments in this day in age because of the simple fact that everybody needs a place to live, and we live in an age where more people are renting than ever before so this makes apartment complexes and other multifamily properties ideal Investments.

How Many Income Streams?

Okay, now that I’ve given you a brief explanation of the differences between passive income and active income, it’s time to answer the question of how many passive income streams should you have?

The answer to this question is simple, ideally that you should have as many passive income streams that you possibly can create but, your ability to focus on creating passive income streams may be directly related to where you’re currently at in life.

One thing that you don’t want to do as an investor is to get caught up in the process of having to maintain all of your income streams. Why? The work that you have to put into you maintaining those income streams means that you have less time to focus on building a portfolio of passive income opportunities.

A good example of this can be found in the real estate investing niche, some investors get started investing in real estate the wrong way by thinking that they should manage their multifamily properties themselves because they think that they should have full control over their properties while also saving the cost of having to pay for a property manager.

Anytime an income stream requires you to invest your time and efforts managing it, it stops being a passive income stream and turns into an active income stream, comparable to a second or third job, and this is only going to add more stress to your life.

If you currently have multiple income streams that require you to spend time and effort managing them every month your goal should be to outsource the management of those income streams as soon as possible so that you can focus on creating passive income streams that don’t require any of your efforts to manage them every month.

Passive Income Stream Ideas

Dividend Stocks – One of the time-tested passive income streams that you should add to your investment portfolio is dividend stocks.

Thankfully, there are a wide variety of dividend stocks available for you to choose from. Many companies typically pay out dividends up to four times per year so it’s best to add a fair amount of dividend stocks to your portfolio because this will ultimately enable you to create passive income that you can depend upon.

High Yield CD’s – Another great way to add passive income streams to your Investment Portfolio is by investing in a high-yield CD. Certificate of Deposits are also one the oldest ways to create a passive income because they have been around forever and there’s nothing easier than putting your money into a CD and knowing that money is going to increase over time

Start An Online Business – Depending upon your familiarity with the Internet, you may want to consider starting an online business.

If you don’t know what type of business you want to start, the good news is that it’s easier than ever to start an online business because it can be as simple as getting started as an affiliate and driving traffic to another company’s offer, or creating your content and earning money from advertising on your website, revenue from YouTube ads and more.

As I mentioned above, your goal when investing in any type of passive income stream should be to have as many people as possible supporting your venture so that it doesn’t become a second or third job.

The same is true with starting an online business, your goal should be to outsource things like product creation, content creation, and traffic generation so that all you have to do is manage those online income streams for a few hours per week on top of any other income streams that you may currently have.

Real Estate Passive Income Streams – Last of all, but most importantly, I want to circle back to the importance of investing in real estate as a passive income stream.

As I mentioned earlier, your goal should be to invest in multifamily properties, sooner rather than later, but, if you don’t want to invest in multifamily right now, you can still get started with investing in multi-family properties by investing in a Real Estate Investment Trust (REIT).

With a real estate investment trust, you can technically be involved with investing in real estate without the hassle of having to manage or maintain investment properties yourself.

The great thing about REIT’s is that like dividend stocks, you can expect the Real Estate Investment Trust to pay a dividend on an annual basis. This will create another passive income stream for you that you can depend upon and use towards getting started with investing in multi-family properties.

Before you invest in your first Real Estate Investment Trust, it’s also important for you to remember that as with investing in a dividend stock, you have to take the time to actually research the Real Estate Investment Trust before you invest in it.

How To Get Started Investing In Multifamily Properties Without The Hassle

Before I end this article, I want to go back to the main point that every investor needs to get started with investing in a multi-family property as soon as possible.

When you have a multi-family property in your Investment Portfolio, you’re going to have an investment that’s going to produce passive income for you every month that’s not dependent upon how the economy is doing, the stock market, or the direction of the country is heading in.

At Trier Capital, Our simple step-by-step process allows you to accelerate your wealth creation so you can live a magnificent life on your terms, whether that means traveling the world, spending more time with family and friends, or making an impact.

Our team has refined a simple process that enables investors from all generations to add more multi-family properties to their investment portfolios without having to spend the time sourcing, acquiring, and managing multi-family properties themselves.

Now is the perfect time to get started with investing in multifamily properties because there’s never been a greater demand for multifamily properties in the United States while prices are low and mortgage interest rates are the lowest that they’ve been in Generations.

To learn more about how to get started with investing in multifamily properties, passive income, or to speak with me about partnering with my company, click here or call me at (630) 229-2383 and I will be glad to speak with you.

Erik Hatch

Erik is currently invested in projects in Florida, Texas and Kentucky totaling $79 Million. He is an accomplished leader who motivates and inspires action while at the same time, is grounded in business metrics and information that drives successful businesses.