There exits three main types of income classification: passive
income, active income and portfolio income. Portfolio income is that
income an individual that an individual gains or receives from
dividends, stocks, interests, capital gains, royalties and bonds. Active
income, sometimes called earned income, is that income one gains or
receives through active participation of the recipient. They include
wages and other earnings that requires ones active participation on the
income earning event. Passive income is that income where once set up,
it requires no material participation or input from the recipient. Thus
passive income opportunities can be defined as those income earned from
undertakings that run through indirect participation.
They can be classified into two broad categories:
- Those that require capital to start, grow and maintain
- Those that do not require capital to start, grow and maintain.
The passive income sources that do not require capital to start, maintain and grow are the best choices for those who want to start on their own and start from nothing. They range from those assets that one can make such as books, Internet websites, songs, trademark etc. Those passive income opportunities that do require capital to start and maintain are those that require large investments per capital such as building properties then renting. They require the individual to invest a lot of money on the project to start, to grow and also to maintain.
Examples of passive income opportunities include:
a) Rent from property: These are the monthly earnings from rented properties such as those received from tenants.
b) Online income opportunities such as those earnings from Internet advertisements on websites.
c) Interest and dividends: These are the profits from earlier investment and account savings.
d) Pensions
e) Royalties: These are earnings generated from intellectual properties as books, music, plays, movies e.t.c
f) Franchising: This involves creating business models which u then franchise and in return earn income by exploiting the talent of the franchisee's.
g) Profits from businesses in which one has very minimal or no active role in running.
Reasons for no shortage passive income opportunities.
1) Taxes and passive income sources
These opportunities are taxed with much favour compared to the active income opportunities. This gives people an incentive to invest in an assets aimed at creating jobs and growing the economy. One that works in his company, for example, pays an extra tax as self employment payroll tax that which is not paid by one that plays a passive role in his company who pays only income taxes.
2) Paths most often taken to passive earning opportunities.
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Most people use there actively earned income to generate or fund there passive projects e.g a doctor or nurse could use his/her actively earned income to start up passive businesses. This over time start to generate passive income to him/her.
3) Other forms of these sources require little or completely no finance/ capital to start, maintain or grow.
Although they may require time and effort to create, these income opportunities require less or no capital to start and run. Such that fall into this category can include advertisements through Internet websites.
Passive income opportunities are hence so many due to the fact that most of them are easy to start, require less capital, create other jobs and economy growth and also not subjected to much tax among other benefits.
They can be classified into two broad categories:
- Those that require capital to start, grow and maintain
- Those that do not require capital to start, grow and maintain.
The passive income sources that do not require capital to start, maintain and grow are the best choices for those who want to start on their own and start from nothing. They range from those assets that one can make such as books, Internet websites, songs, trademark etc. Those passive income opportunities that do require capital to start and maintain are those that require large investments per capital such as building properties then renting. They require the individual to invest a lot of money on the project to start, to grow and also to maintain.
Examples of passive income opportunities include:
a) Rent from property: These are the monthly earnings from rented properties such as those received from tenants.
b) Online income opportunities such as those earnings from Internet advertisements on websites.
c) Interest and dividends: These are the profits from earlier investment and account savings.
d) Pensions
e) Royalties: These are earnings generated from intellectual properties as books, music, plays, movies e.t.c
f) Franchising: This involves creating business models which u then franchise and in return earn income by exploiting the talent of the franchisee's.
g) Profits from businesses in which one has very minimal or no active role in running.
Reasons for no shortage passive income opportunities.
1) Taxes and passive income sources
These opportunities are taxed with much favour compared to the active income opportunities. This gives people an incentive to invest in an assets aimed at creating jobs and growing the economy. One that works in his company, for example, pays an extra tax as self employment payroll tax that which is not paid by one that plays a passive role in his company who pays only income taxes.
2) Paths most often taken to passive earning opportunities.
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Most people use there actively earned income to generate or fund there passive projects e.g a doctor or nurse could use his/her actively earned income to start up passive businesses. This over time start to generate passive income to him/her.
3) Other forms of these sources require little or completely no finance/ capital to start, maintain or grow.
Although they may require time and effort to create, these income opportunities require less or no capital to start and run. Such that fall into this category can include advertisements through Internet websites.
Passive income opportunities are hence so many due to the fact that most of them are easy to start, require less capital, create other jobs and economy growth and also not subjected to much tax among other benefits.
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