The Myths & Realities of Achieving FINANCIAL INDEPENDENCE

Written by John Commuta

The Myths & Realities of Achieving FINANCIAL INDEPENDENCE

Financial Independence.

What exactly does it mean? Well, Webster's Dictionary defines the terms this way:

Financial:
Pertaining to the science of managing money.

Independence:
Freedom from assistance by others.

So financial independence means the ability to manage your money in such a way that you have sufficient funds to live your chosen lifestyle without assistance from others. In other words, enough money to meet all your needs whether you work or not, because a job is really assistance from someone else — your employer.

Notice that this definition doesn't mention amounts of money or the symbols of having money that we often attach to financial independence. To some people financial independence might mean yachts, mansions, and expensive foreign cars; while to others it might simply mean never having to worry about bills again — knowing they will always have a comfortable home and the time and resources to enjoy their interests and hobbies. For many, not having to work a second job, or maybe just having sufficient income so their spouse could stay home with the children, would constitute financial independence.

What does financial independence mean to you? What would it mean to your life? How would your days and nights be better if you knew you had the resources to meet all your financial obligations for the rest of your life?

The easiest way to begin framing this picture in your mind is to think of a typical day. Not a special day, where you do something you might only do occasionally, but an average day, one that would be filled only with what you'd be doing most days once you've achieved financial independence.

What time would you wake up?
Would you be awakened by an alarm clock or by your body's clock?
Once you arose, what would you do first? Second?
When and what would you eat?
What would be the main activity of your day?
How would you spend the evening?
What would determine when you went to bed?
What would your home look like?
What kind of vehicles would be a part of this typical day?
Spend a few moments in that daydream: in a typical day in your financially independent life.

Now ... are you really ready? Are you ready to make the changes to your present life that will allow you to achieve that kind of independence? After all, if no changes were necessary for you to achieve financial independence, you'd already be there.

If honesty forces you to admit your prospects for true financial independence are cloudy at best, then let's get on with figuring out how to blow those clouds away.

Ralph Waldo Emerson once said, "What lies behind us and what lies before us are small matters compared to what lies within us." What you have to determine is whether financial independence lies within you.

That's right ... you either have what it takes or you don't. You're either made of the stuff that yearns for selfdirection and self-support or you're not. Only you can examine the true you and answer this challenge.

In the late '80s I had to take the same inventory of myself. I had a growing business and was making great money. I had a beautiful house, fancy cars, and a private plane. Yet like most Americans, I was living up to the maximum of my income — and with the help of Uncle Visa and Aunt MasterCard, a little beyond it.

When I stared it right in the face, I knew my life was a house of cards and that when my working years ran out, I'd be in a real mess. Unfortunately, circumstances didn't even allow me that much time. My business was reselling another company's product, and when that company suddenly went out of business, it pulled us down with it.

My personal income dropped from really good to zero, almost overnight. That began the worst two years of my life. Panic-filled days, sleepless nights, relationship stresses, and the seemingly endless scramble to save my home and find another income source.

That nightmarish experience caused me to seek the true path to financial security and freedom. Not the hype baloney you read or hear from the pushers of what I call "The Solution Lies." Those are the people who tell you the answer to your problem is to make zillions of dollars — and you can do that by just buying their magical money-making scheme.

I knew there had to be a realistic system for achieving true financial independence. And I knew that such a system would have rules. Rules that are laws, like gravity.

Well, I found those rules. Once I did, the money map of my life sharpened from an indistinguishable maze to a clear route to my goal. I developed a plan for my life based on these rules and road signs, and I put that plan into action.

One year later, my wife and I had all of our bills other than the house paid off. Less than four years after that, the 26-year balance on the house mortgage was eliminated. And less than five years after that, we began living 100 percent off the proceeds from our investments. Working is now optional.

The incredible thing is that we accomplished all of this with the same amount of money we had been bringing home each month all along — our regular paychecks. If we had added more money into the system, we could have been out of debt faster and ended up with even more retirement savings.

In the process, I discovered that many of the central financial principles most people operate under are simply not true. I call these the Myths of Financial Independence. Disabusing yourself of these lies is an absolutely critical step on the road to wealth, freedom, and real peace of mind. I invite you to take that step right now:

Myth #1
You can use money the same way everyone around you uses it — and still end up financially independent.

The United States Department of Health and Human Services regularly conducts an extensive study of what happens to the average worker in this country by the time he or she reaches conventional retirement age (U.S. Department of Health and Human Services study). The pitiful results show that fully 95 percent of the people in this country DO NOT achieve financial independence by age 65, but rather they end up DEPENDENT on the government, or charity, or their families, or they have to keep working until they die. ninety- five percent. That's almost everybody!

These are working people just like you and me, people who went through their lives believing the myth that if they were just good employees and good consumers, they would be rewarded in the end. Instead, most of them end up struggling to survive on a Social Security check and/or a pitifully small pension. It isn't pretty. If you know anyone living on Social Security, visit with that person for a day and see if that's how you want to spend the "Golden Years" of your life.

The truth is inescapable. If you're using money like most Americans — buying things on credit, making monthly payments, trying to put away a few bucks each month, etc. — you're doomed to end up the same way they will: BROKE!

Myth #2
The responsible use of credit can enhance your financial well-being.

This may be the single most dangerous lie told to the American consumer. Only the merchants and the lenders benefit from your using credit. You DO NOT! All credit does for you is raise the price of the things you buy. And if you pay more for everything, over the years you'll be able to buy independence forever. You have to put in the most effort upfront. Then after a while, you can relax into a wonderful lifestyle and spend a lot less time and effort maintaining that lifestyle and income ... giving you time for your loved ones, hobbies, and maybe even dreams you have long since let go.

Reality #3
You must develop and maintain a long-term view.

If you hear yourself saying, "I really should pay off my debts and start building my financial independence fund, but there are a few more things I want first," translate that to, "I want to continue wasting my life, taking no action to build a better future, and I'll risk the consequences later."

If you live only for today's gratification and never really begin building a financially secure future — my estimate is that it'll cost you about $423 in lost future wealth every day you wait!

Reality #4
It takes more than a few weeks to build real financial independence.

My debt-freedom plan took just four years and seven months, and five years later I could live off my investments alone. That may seem pretty fast to you. But it did not happen overnight. I didn't find the goose that lays the golden egg. I just rerouted the money already moving through my life into a plan that allowed it to accumulate for my family's benefit, rather than the benefit of my creditors.

Beware of people telling you it can be done overnight. That's the lack of wisdom that feeds lotteries ... and lotteries are just a tax on people who don't understand statistics.

Getting rich does take some time. Accept that fact and you'll enjoy life more, while you get rich.
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Financial independence may not be possible by following the path you've been on up until today. But I am living proof that IT IS POSSIBLE once you shed the myths, embrace the realities, and really commit yourself to a sound, structured plan for achieving your financial goals.
Just think of what that kind of independence could mean to your life. No more pressure from bills. No risk of losing your home, car, or anything FEWER things than people making the same income as you who pay cash instead of using credit. So using credit will actually diminish your lifestyle, not enhance it. The people using cash will be able to afford a better lifestyle than you.

Consider this: The only true measure of wealth is net worth — how much you own MINUS how much you owe. So owing money on assets you supposedly "own," like your house or car, reduces your net worth, thereby reducing your wealth. The only way to really achieve true financial independence is to own everything in your life and owe nothing. That's real wealth.

Myth #3
Pay yourself first.

The false belief here is that you can carry a load of debt and otherwise use money like everyone else around you, as long as you first put a little aside in some kind of savings or investment each month.

The truth is that you should PAY ALL OF YOUR DEBTS OFF FIRST, and only then begin paying yourself. It's the only way to dramatically accelerate your journey to financial independence.

If you think about this, it just makes sense. When you pay off your debts first, you then need less to live on each month because you're only paying for food, utilities, taxes, insurance, and any other minor expenses, leaving you with a lot of savable money each month. So it will only take months instead of years to save up a sufficient emergency fund. After that, your retirement investments will build rapidly because you're funding them at a high level each month.

Myth #4
You can get out of debt by putting a little extra on each bill each month.

To effectively eliminate your debts, you have to use the military principle of "massing of forces." This means you concentrate all available resources on ONE debt at a time.

This way, you pay the target debt off quickly, thereby recovering its monthly payment, which you will then add to the amount you'll mass against the second debt, and so on.

A quick rule of thumb would be to pay off your debts in order of their outstanding balances, working from the smallest balance debt to the largest.

By doing this, the amount you have available to "invest" in your debts will actually accelerate after each debt is paid off and you recover what used to be its monthly payment.

Targeting debts by interest rate is not generally the best strategy.

Myth #5
You need to learn how to "manage" credit.

You need to learn how to ELIMINATE credit from your life. The idea of "managing credit" is like "managing a drug addiction." There's no such thing as a good way to "manage" something that's damaging to your well-being.

Once you're debt-free, you'll never need credit again. If you want to move up to a better house, you'll just sell the one you own free and clear — maybe take a little additional money out of your swelling investment account — and buy your new house with cash.

That's how it works when you eliminate debt. When you just manage debt, you stay in the 95 percent group along with all the other financial failures.

Myth #6
To be successful, you have to work "smarter not harder."

Everyone I've ever met who has achieved financial independence will tell you that — at least in the early days — you have to work smarter and harder. The price of success must be paid in full, and it must be paid in advance. There are no shortcuts.

This is particularly true if you're going to try to build a business, even a home-based business, as part of your financial independence plan. Building a business takes more work than a job, at least in the beginning. It also offers greater rewards than a job, both financial and emotional. But you should never be fooled into thinking that building a significant revenue stream can be effortless. If you see that kind of promise in a business's advertising literature, they are lying to you!

It takes hard work to achieve financial independence, which is probably one of the primary reasons why 95 percent of people don't do it.

Myth #7
It takes OPM (other people's money) to make money.

I know from experience that this is simply not true. I built a three-time Inc. 500 multimillion-dollar-a-year business starting with less than a $100 investment, working out of a spare bedroom.

The most dangerous result of this myth is when borrowers realize too late that the "other people" you borrowed the money from expect to be paid back — WITH INTEREST! Like most shortcut-to-riches illusions, using borrowed money to build financial independence frequently has the opposite result. It accelerates your financial ruin.

For every person who might succeed this way, a hundred lose their shirts ... and the houses those shirts were hanging in.
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Once you've freed yourself from these misconceptions and outright fabrications, you will have eliminated the major obstacles standing between you and a financially free future. The next step is to accept and commit yourself to a few basic, inescapable Realities of Financial Independence.
Reality #1
If you're not already financially independent — or well on your way — you must change your financial behavior to succeed.

There are only two ways you can leave this article — changed or resigned. CHOOSE TO CHANGE. It's really that simple.

Reality #2
You have to be willing to put forth effort.

The only place success comes before work is in the dictionary. But you don't have to work hard at achieving financial else, because you'll own it all. No more worrying about the financial implications of life's "what-ifs." Being able to work if you want to, or not work if you don't want to.

That's true freedom — and you deserve to be enjoying it.

Finding Passive Income Sources for the Future: Four Potential Avenues I’m Evaluating

ShareJune 20, 2008 @ 2:00 pm - Written by Trent

Lately, I’ve been looking at sources of passive income in order to bolster (and hopefully eventually replace) my current income. It is a fond dream that at some point in the future, I could largely step back from doing active day-to-day work and instead use these sources as my primary income stream. In that eventuality, I could devote my time to volunteer causes and charities I’m passionate about (and maybe have time to sit back and read a book for pleasure on a lazy afternoon every once in a while).

First of all, what is passive income? You’ll find a lot of definitions of it online, but mine’s pretty simple: passive income is any source of sustained income that you earn without any additional work. You might have to put up a lot of work up front, but once the money is rolling in, it doesn’t require any additional effort to earn money (additional effort might help to increase earnings, but it’s not required for some level of income). Thus, I don’t identify things like being the landlord of a rental property or blogging to be passive income – both require significant and regular work to earn money.

Passive income isn’t a way to get rich. That’s not the point, and anyone claiming you can get rich from it is selling snake oil. For me, it’s an investment of money and time now to buy time later. Notice how the output has nothing to do with money – it’s about putting resources away now so that I don’t have to invest time working in the future to maintain my standard of living.

Here are four sources of passive income that I’m looking at for my own future, along with some suggestions on how you can get started.

Investments that pay dividends or distributions
The mere act of owning many investments can be considered a source of passive income. You merely hold the investment and regular dividends are paid out to you. Many people tend to focus on investments in terms of the increase in resale value, but many others quietly hold stocks and bonds that pay large dividends, lining their pockets with capital gains. Look for individual stocks and bonds or index funds that pay good dividends, then sit back and watch the money roll in.

How can I get started? Just start an account at an investing house (Sharebuilder‘s my pick for beginners who want to buy individual stocks; Vanguard‘s the place to go in my opinion for index funds) and set up an automatic deposit into the account. Let the dividends roll over until you need them for income, then just collect the dividends as cash. Passive income at its easiest, and I plan on digging into these options more in the future, both as investments for future things and as potential passive income if it’s necessary.

My plan Once our non-mortgage debt is gone (hopefully by the end of the year), I intend to start investing in Vanguard index funds in a taxable account (and perhaps a few individual stocks of companies I believe in) and holding that investment with a fairly long time. While our goal is to eventually use that money to buy a plot of country land and build a home, it’s also quite possible that I’ll just turn it into a passive income source by collecting dividends or bond distributions.

Writing a book
The normal procedure for writing a book involves getting a book deal and an advance check, writing the book and submitting the manuscript, then getting (possibly) another advance check, then sitting around while the royalty checks come in. It’s a nice way to get a passive income stream, but it requires a ton of upfront work and a significant time investment. However, once it is done, it not only earns money slowly over the long tail, but it also opens the doors to other active opportunities – an active-passive double header.

How can I get started? You can start by getting your toes into writing. Find venues where you can sell written pieces and make a bit of cash while also building up your resume. Then, when you have several pieces in print and a good idea, pitch a book to a small-to-medium sized publishing house or get an agent to shop one around for you. Get the deal, write the book, then the royalty checks come.

My plan I’m currently in the process of doing this. Once the work is done, I receive my final advance check, the book goes into print, and I receive royalties, no extra work really required. Granted, it won’t be large checks, but it’s a start. The real key (for me at least) is to write several books, enough so that the royalty checks are significant.

Developing a static website of some interest
If you don’t want to invest all the effort of writing a book, you can instead just develop a static website with whatever amount of written material you want. An individual site won’t earn you much, but considering you can set the whole thing up with just a few hours’ worth of work and walk away, even a few pennies a day can make the endeavor worthwhile over the long haul.

How can I get started? Think of a topic you know something about. Write down the useful information you know about the topic, and take pictures, too, if need be. Find a free hosting site online, like Google Pages, then put your materials there. Sign up for an ad service like Google Adsense and put a few ad blocks on the site. Submit the URL to a search engine or two, then sit back and wait. This is something you can do in an afternoon. Be aware that one single site won’t earn you much unless you have something seriously compelling – many people that do this make new sites and pages all the time to add to their repertoire. It’s passive in that they’ll earn income whether they add new sites or not – adding new sites merely increases the income potential.

My plan These are great ways to develop specific written ideas you might have and to share them with the world while earning some passive income. I have a few things I plan on documenting in just this fashion. In fact, if I ever get tired of actively writing The Simple Dollar, this is what it will functionally become – a static site on a server somewhere, slowly earning some income over the long tail for many years to come. I don’t think I’ll stop actively writing The Simple Dollar for a long time, though – I truly enjoy it.

Creating and selling creative products online
There are many sites where you can create or upload creative products and have them earn an income for you over time. Zazzle and Cafepress let you design t-shirts, coffee mugs, keychains and such to sell (they manufacture it and you get a cut as a designer), while Metacafe and Revver let you upload videos of your own creation and pay you if they’re viewed by others. The best part is once you’ve uploaded your design or your video, you can just walk away and the passive income will trickle in.

How can I get started? If making a video or designing a t-shirt sound compelling to you, give these sites a shot. They’re all pretty simple to use and can be lucrative if you create something that catches on. Just try uploading some things – even if you don’t make any money, you can still leave them up there and it might catch on later.

My plan I’ve been thinking of making a series of videos to run on Metacafe or Revver focusing on a number of topics (personal finance and cooking). My wife and I have already plotted out several ideas and have thought about creating them in our spare time, then posting them also to The Simple Dollar. We’ve also talked about designing t-shirts to put on Cafepress and/or Zazzle, but that’s a more nebulous idea. Both of these are in my “projects” folder – they’re things that would add to the portfolio of potential passive income streams if we invest the time to create them up front.

These are the four methods of passive income I’m strongly looking at. Do you have any interesting ideas for ways that people can create passive income?

How to Make Money Online by Writing Articles and Creating a Reliable Source of Passive Income with Stock Dividends

by Michael on September 22, 2010

The internet thrives on content. And if you have a knack for writing, then you could possibly make a good amount of money online by writing content for various websites. That’s because websites such as InfoBarrel, Squidoo, and eHow all share advertising revenue with their writers in exchange for well-written and unique content. All three of those websites display Google Adsense ads, Amazon.com ads, or other advertisements along side your articles, and then split the revenue that’s generated from them with you. Here’s how to create an excellent form of passive income online by writing articles:

Choose a Specific Niche – A lot of people write content for those websites. So, a lot of different topics are already being covered by other writers. However, my theory is that the more specific your article topics are, the more passive income you’ll make from them. For example, say you like to write about making money online. You could be more specific and write articles about making money online with email lists. And then switch it up a bit and write about making money online using product review videos.

Do Your Keyword Research – More than likely, most people will find your articles online by using a search engine such as Google or Bing. So it’s important that as you write your articles, you include the right “keywords” to ensure that your articles rank well in search engine results. To find the those keywords, use the Google Keyword Tool. Use the Google Keyword Tool to see what keywords people are searching for based on your article’s topic, and then write those keywords into your articles.

Keep Writing, and Writing, and Writing… - Depending on how popular the articles you write are, chances are they’ll only generate a few dollars a month in revenue. It may not be much, but it’s something and it’s a form of passive income. But if you keep writing, and write hundreds or even thousands of articles about different topics and get them published on InfoBarrel, Squidoo, an eHow, you could possibly make hundreds or even thousands of dollars a month. In general, the more articles you write, the more money you stand to make.

If you have a website, you can also use those websites to promote it. All three websites have an “about the author” section where you can post your website’s URL. So, not only can you make money from the articles themselves, but you can make money from the people who visit your website from the articles you write.

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Create a Reliable Source of Passive Income with Stock Dividends
by Michael on August 18, 2010

One of the easiest ways to create an asset is to buy stock in a publicly-traded company. There are literally thousands upon thousands of companies that allow you to buy stock in them. And thanks to today’s technology, if you already have an online brokerage account, you can buy stock in a company in as little as 10 seconds using your computer or even your cell phone.

Even if you’ve never bought stock in a company before, I’m sure you’ve still heard the phrase “Buy Low, Sell High” at least once in your life. “Buy Low, Sell High” means that when you buy a stock, you buy it at a low price with the hopes that in the future, the stock price goes up so you can sell it for more than you paid for it, making a nice profit. That’s just one way to make money with stocks. Another way is to buy stocks that pay dividends.

People who own shares of stock in a company are referred to as shareholders. Some companies distribute their earnings to their shareholders in the form of stock dividends. Companies like Verizon, McDonald’s, Walmart, AT&T, Boeing, and Kraft Foods all pay dividends to their shareholders. To put it simply, these companies pay you money just for owning shares of their stock. To show you how dividends work and how they can provide passive income, let’s take a look at Verizon.

Verizon trades under the ticker symbol VZ. At the time this article was written, Verizon’s stock price was $29.90 a share. If you go to the Yahoo Finance page for Verizon, you’ll see all kinds of important statistics and information such as Market Cap, P/E Ratio, EPS, Volume, and so on. But for the purpose of this article, we’re going to focus solely on the “Div & Yield” part. This is where you’ll see what Verizon’s current dividend is per share, and what the current dividend yield is based on the stock price.

As of this writing, the Yahoo Finance page for Verizon shows that the current dividend is $1.90. This means that over the course of a year, Verizon pays you $1.90 for every share that you own. So if you own 1000 shares in Verizon, then you’re total dividend payments over the course of a year would be about $1,900, which is $1.90 (the dividend Verizon pays shareholders) * 1000 (the number of shares you own). Just like a stock price though, dividend payments do fluctuate, they can go up or down. However, unless a company’s financial situation changes dramatically in a short period of time, dividend payment amounts don’t typically change much often.

If you take the $1.90 dividend that Verizon pays and divide it by the current stock price of $29.90, you get 0.0635. Multiply that by 100, and you get 6.35. That’s the current dividend yield for Verizon, 6.35%. The dividend yield is the magic number you want to look for when choosing a dividend-yielding stock to invest in. Compared to the average savings account rates of .50% to 1%, 6.35% is much more attractive. Dividend yields vary from stock to stock. There are a lot of stocks that pay no dividend, so they have no dividend yield. Then there are other stocks, like REIT’s, that have dividend yields of 12% to 18%. As attractive as those high yields are, make sure to research the financial health of the companies offering those dividend yields before making an investment.

So now you’ve learned a little bit about dividends. But, how exactly are those dividends paid to you? Well, most companies distribute their dividends quarterly. Let’s use Verizon as an example again. If you divide the $1.90 by 4, you get $0.48. So every 3 months Verizon sends you a dividend of 48 cents. That money is usually deposited directly into your brokerage account, which you can then withdrawal as cash. Or, you have the option of having your dividends automatically buy more stock in that company, resulting in more dividends. Buying more of the same stock with it’s dividends is called Dividend Reinvestment, and most brokerages offer this service for free.

8 Ways To Earn Passive Income Online

Wouldn't you like to take a vacation whenever you want, or
have your wife stop working so she can look after the kids
and still keep up the payment of your bills? Well, if you
wish to achieve this, you need to build a passive residual
income.

Definition of passive residual income:

The definition of traditional passive income is "Income
generated with minimal work from your investments such as
interest, dividends, or real estate rentals." However in
this article we are discussing creating a passive income
online. Investment of time and money is initially required
to build a passive income online, then possibly minimal
work thereafter.

The benefits of generating a passive income:

1. Make a strong initial effort to get your income started,
then do minimal work (or virtually none) thereafter,
resulting in earning more and doing less.

2. Freedom to choose when and where you wish to work.

3. Your passive residual income is not dependent on a 9-5
work week and can be generated 24 hours, 7 days a week.

4. Able to give yourself a pay raise whenever you want by
creating multiple income streams.

5. Create an unlimited amount of income - you are only
limited by your imagination.

6. Have more free time to spend time with your family,
friends or go on vacation.

7. Ability to give to charitable causes.

8. Create residual income for your future retirement.

Types of passive income streams to build online:

1. Affiliate Programs - passive income is derived from
setting up a web site that presells a companies’ products.
The parent company provides the products, tracks the sales
and gives you a commission for each sale. Find companies
that offer large commissions, and will track clients for
multiple sales over a long period of time (ie lifetime)
so you can get recurring commissions. Make sure they offer
multiple tiers (at least 2) for sales. ie you still get
paid if one of your affiliates makes a sale.

One of the best examples is the 5 Pillar Affiliate Program
from Ken Envoy.

He offers a number of great products with high commissions
with excellent sales materials and content to help you
presell his products.

Read the free ebook: Affiliate Masters Course to become a
high-earning affiliate champion.

2. Information Products - the web is great place to create
an ebook that explains 'How to" information ie How to start
an online business, How to buy a car without getting ripped
off..anything that makes life easier for people. People are
hungry for information, therefore if there is a need, you
can create an ebook and sell it on the Net.

What are the benefits of creating an ebook?

Easy to create - you just need the ebook creation software.
Takes a short amount of time - you can create an info
report in a few hours or days. A large ebook may take
several weeks or months.

Low cost - costs will include ebook creation software, web
site design, web hosting and marketing. Once you this set
up, with good promotion in the search engines, you can make
sales from your ebook 24 hours a day for years to come.

Add an affiliate program - increase the number of ebook sales
sales by getting other people to sell it for a commission.
This enables you greatly increase your passive income.

Allow reprint rights - charge a fee for people that will
have the complete reprint rights. They are able to place
there own affiliate links in the ebook and sell it for the
same price to others.
3. Creating software products - if you have a good idea for
a software product that will help people do something
faster, easier or teach them something, then you may have a
winner.

A friend of mine created a course that educates
autism kids step by step. He then sells the course on
a CD to educational institutions and individuals all over
the world. He makes a nice passive income each month from
his initial investment of time, effort and money. The best
example is Bill Gates who created the Microsoft Corporation
selling the Windows Operating System. You could do the same
on a smaller scale.

4. Advertising commissions - if you have a web site that
attracts 1000s of visitors a day from the search engines,
you can offer to place a banner or link on your site for a
fee that you collect each month. You set it up once, then
collect the passive residual income.

Newsletters,or ezines - offer advertising space in your
ezine. The greater number of subscribers you have the more
you can charge every time you publish.

eBooks - offer advertising space in your ebook. Give the
ebook away for free or even place links in it from
affiliate programs you recommend.

Google AdSense - place Google Ads on your web site. When
someone clicks on the ad, you get a commission for every
click. If you have 100s or 1000s of pages on your site, you
can earn a substantial monthly income.

Read: "How to monetize your web site with Google AdSense"
5. Pay Per Click Campaigns - you can make money instantly
by setting up a Google AdWords campaign for your product or
affiliate program. If there are not too many competitors
promoting the same product and it is in high demand, you
can earn a good passive income. Creating several successful
campaigns will multiply the amount you can make.

Read: How to Set Up a Successful Google AdWords Campaign

6. Referrals - create a network of people that offer
services or products related to your business. Ask for a
commission every time you refer someone. For example as a
web designer, I sometimes refer clients to graphic designers,
search engine optimization experts, copywriters and database
designers especially when I don't have the time to do the
work myself or it is outside my area of expertise.

7. Create a membership site - if you are an expert in your
field and can provide the resources, knowledge and support,
you can charge a monthly fee to gain access to your
membership site. The more members you gain, the more money
you make. Because you are an expert in your field, you can
also recommend other products and services to your members,
from which you earn commissions.

8. Become a Reseller - by reselling other people's services
you can earn ongoing residual income.

One such example is web hosting or domain name
registration. You pay a monthly fee to the reseller and you
can charge whatever you like to your customers for your
service. Of course you must be thoroughly familiar with the
service to provide the necessary support to your clients.

Conclusion: Building multiple passive income streams is a
great way to secure yourself for the future. You never know
if you will be laid off from your regular job, get too ill
to work, experience a disaster or want to start saving for
your retirement.

Choose one of the above types of passive income streams and
take action now, to secure your financial future.

How to Build Passive Income with Article Sites

(from writingforyourwealth.com)
I’m not a big fan of the term passive income, because outside of stock dividends and interest bearing accounts, I don’t think the term is particularly accurate. Real estate needs to be managed, books require marketing to sell, businesses need work to grow, and websites that are never updated lose traffic as they’re surpassed by sites that are regularly updated.

That said, I do know that Tim Ferris’s controversial “4-Hour Work Week” is possible, and one way to get there is with article sites. You can build sites that require very little ongoing work and can bring in respectable XXX and even X,XXX earnings per month.

I’m not talking about blogs, which come with the expectation of frequent updates, but simple article-based sites that may never have more than 50 or 100 pages.

About half of my income is from blogs, and half is from straight html sites that run Adsense and sometimes link to affiliate products. There aren’t any comments to moderate, communities to build, advertisers to deal with, or customers to placate. These article sites simply provide information, get traffic from the search engines, and make money from people clicking ads.

Once they’re built, I may only work on a site a few hours in a whole year (though if they show a lot of potential, I’ll probably attend them a couple times a month). I’ll add an article or two and maybe submit an article to ezinearticles in order to get some natural links. This small amount of work keeps them ranking in the search engines and bringing me in money, day after day, month after month. It’s not entirely passive income, but it’s a pretty good deal!

For those of you who may be interested in adding some article sites to your online empire, I’m going to do a little series that covers my strategies. As with building a blog, it takes time to start earning money (content needs to be built up, domains need to “age,” links need to be acquired, etc.), but once you have the initial site built, the time demand is very little for ongoing maintenance.

You can get started with 10 or 20 articles, so you could get a site up in a fairly short order, if you were so motivated. You may even want to start several, so that you can build one, and move on to the next and the next without obsessing over when that first one will make its first dollar.

Here’s a list of what this series will cover:

How to Build (mostly!) Passive Income with Article Sites Series

1 — Introduction (You’re Reading It!)
2 — Choosing a Profitable Niche and Scoping out the Competition
3 — A Keyword Rich Domain Name and Other on-Site SEO Considerations
4 — Using Keyword Research to Write Pinpoint Articles
5 — Link Building Techniques
6 — Adding Google Adsense
7 — Should You Consider Affiliate Programs?
8 — The Technical Side: Getting Your Article Site Online

Passive Income Resources (from lifeoptimizer.org)

Passive income is our key to financial freedom. The more passive income we generate, the less dependent we are on our job. At one point, when our passive income exceeds our expenses, we can stop working anytime we want and still live the lifestyle we desire. That is financial freedom.

But passive income takes time to build. You can’t expect to start working on it now and be financially freedom next year unless you are very lucky. So the best time to start is now. The earlier you start working to build your passive income, the sooner you will reap the results.

That’s why I put together this list of free passive income resources. There are a lot free passive income resources out there, but I put only the useful ones here. I hope this list can be a starting point and a companion in your journey toward financial freedom. The list starts with the definitions followed by the e-books, articles, and audio resources.



Definitions

■Passive Income (Wikipedia)
■Passive Income (Investopedia)
■Financial Freedom (Wikipedia)
E-Books

■A Guide to Making Passive Income
■Blog Profits Blueprint
■The Cycle of Wealth
Articles – General

■Automate Your Income to Simplify Your Life
■Two Simple But Powerful Rules to Achieve Financial Freedom
■The Simple Dollar on Passive Income
■Five Ways to Create Passive Income With Little or No Money
■Passive Income Strategies
■How Should I Create Passive Income?
■Building, Diversifying, and Shifting Your Income Streams
Articles – Internet Marketing

■5 Ways To Make Passive Income On Your Website
■How to Make Money From Your Blog
■Building an Online Empire: 16 Types of Websites You Can Create for Profit
■Top 10 Internet Home Business Ideas You Can Start and Run in Your Underwear
Articles – Miscellanous

■Building a Foundation: Ten Things To Do First If You’re Looking At Starting Your Own Business
■Real Estate :: The Ultimate Passive Income
Audio

■How to Make Money Without a Job
■Kick-start Your Own Business
Bonus – Recommended Books

While collecting these resources, I noticed that there are several books which are often mentioned regarding passive income. These books are not free, but I add them here in case you want to learn more about the subject. I have read all of them except the last one. Here they are:

■Your Money or Your Life
■Rich Dad Poor Dad
■The 4-Hour Workweek
■Multiple Streams of Income

Top Ten Boxers for 2010

As boxing prepares to move into 2011 with a number of big fights already on the books, it’s a good time to tell the movers and the shakers in the industry what we expect from them.

I’m not going to give out holiday gifts or make New Year’s resolutions for any of them, but let these men know what it will take to keep and/or earn our trust and our business.

Floyd Mayweather – Mayweather is one of the greatest boxers of recent times. Recently, though, he’s doing more of his fighting outside of the ring than in it. So, Floyd, we want a clarification: Are you a boxer any longer? If you plan to fight, say so and don’t let the fans who have made you rich twist in the wind. Quit acting like a pompous jerk when it comes to your money. Yeah, we know you’re rich. We get that. But guess what? A lot of people are hurting and it would be nice if you showed some sensitivity toward that. I know you do a lot of charity work, but flaunting your wealth does nothing but make you look small. And finally, stay out of trouble, please. The Las Vegas police have enough to do.

More From Kevin IoleMartinez finishes on top of impressive group Dec 23, 2010 Sarmiento weaves his magic with Martinez Dec 22, 2010 AdChoices
Richard Schaefer – The Golden Boy CEO is actually a good guy, but he’s clearly not a good loser. When one of his fighters loses, Schaefer rants and raves like he’s a 2-year-old. Tone it down, Richard. It’s very unbecoming. More importantly, extend an olive branch to other promoters, including Top Rank. Make an honest effort to make the best fights. Don’t always look for the edge. Remember, a healthier industry benefits you in the long run.

Ross Greenburg and Kery Davis – The two men who are primarily responsible for the fights you see on HBO need to do a better job, frankly. We don’t need to see fights like Berto against Freddy Hernandez any more. I love the start to 2011: Timothy Bradley against Devon Alexander and Fernando Montiel against Nonito Donaire. That should be the rule, not the exception. Open your doors to all promoters with the proviso you’re interested only in great fights. Period.

Manny Pacquiao – The pound-for-pound best fighter in the world has to develop a mind of his own. He’s fighting Shane Mosley on May 7 in a match hand-picked by promoter Bob Arum. Had Pacquiao spoken up instead of quietly going along with whatever Arum wants, we might be getting a third fight with Juan Manuel Marquez now.

Alfredo Angulo – Angulo is an entertaining fighter, but he’s delusional. He turned down $750,000 earlier this year to fight middleweight champion Sergio Martinez. I’m all for boxers making as much as they can, given the risks they take, but Angulo and a number of other fighters like them (I’m thinking of you, Timothy Bradley and Andre Berto) seem to have lost sight of the value of a dollar. They scoff at purses like $750,000 like it’s minimum wage when they barely sell any tickets. Promoter Gary Shaw had to buy tickets himself at a July card in Palm Springs in order to get 1,800 tickets sold when both Angulo and Bradley were on the card. If you can’t sell tickets, you’re not worth $1 million (or $750,000, for that matter). We need to get back to the day when boxers are required to sell tickets as part of their contracts.

Ken Hershman – The general manager of Showtime Sports has done many good things in creating four- and six-man tournaments. I want to see more of them. But frankly, the six-man tournament doesn’t work. Showtime’s four-man bantamweight tournament, in which there were two fights on one night with the winners facing each other is perfect. But take it up a notch: Give fighters who win by knockout a $100,000 bonus in the first round and a $250,000 bonus in the finals. Put a little of the prize back into prize fighting.

David Haye – Fight one of the Klitschko brothers. Period. Or we don’t take you or your WBA heavyweight title belt at all seriously. OK? OK. Bye.

Al Haymon – Haymon is the adviser to many star boxers, including Mayweather. Yet, he’s neither a promoter nor a manager, so he’s not regulated by any athletic commissions. He’s also notoriously media shy. He’s made a lot of money off the sport and owes it to the fans who have put that money into his pocket to explain a few of his decisions. He doesn’t have to be Lou DiBella, for instance, but it would be nice to hear from him and his thinking more than, well, never.

Antonio Tarver – You have much promise as an announcer; you have zero promise as a heavyweight. Give up this goofy notion you can become a factor at heavyweight and stick to a career in which you can quickly become a star: Broadcasting.

Shane Mosley – There has been outrage on the Internet since Mosley agreed to terms to face Manny Pacquiao on Tuesday. Mosley is going to be nearly 40 by the time the fight takes place and public sentiment is decidedly against him getting the fight. But don’t take the criticism personally; rather, train and fight your best and shut everyone up. That’s always the best response, to do your talking with your performance.

With that, let’s present the Top 10 in the December ratings:

1. Manny Pacquiao
Points: 329 (32 of 33 first-place votes)
Record: 52-3-2 (38 KOs)
Title: WBC super welterweight champion & WBO welterweight champion
Last outing: W12 over Antonio Margarito on Nov. 13
Previous ranking: 1
Up next: May 7 vs. Shane Mosley in Las Vegas
Analysis:Fans up in arm over choice of Mosley as opponent



2. Floyd Mayweather Jr.
Points: 282 (1 of 33 first-place votes)
Record: 41-0 (25 KOs)
Title: None
Last outing: W12 over No. 10 Shane Mosley on May 1
Previous ranking: 2
Up next:Nothing scheduled
Analysis:Legal woes put fight career in jeopardy.



3. Sergio Martinez
Points: 257
Record: 46-2-2 (25 KOs)
Title: WBC middleweight champion
Last outing: KO2 Paul Williams on Nov. 20
Previous ranking: 3
Up next: March 12 against TBA
Analysis: Never has an elite boxer had such trouble finding an opponent


4. Juan Manuel Marquez
Points: 205
Record: 52-5-1 (35 KOs)
Title: WBA, WBO lightweight champion
Last outing: TKO9 over Michael Katsidis on Nov. 27
Previous ranking: 4
Up next: April 16 in Las Vegas vs. TBA
Analysis: Deserved shot to fight Pacquiao



5. Wladimir Klitschko
Points: 115
Record: 55-3 (49 KOs)
Title: IBF, WBO heavyweight champion
Last outing: TKO10 over Samuel Peter on Sept. 11
Previous ranking: 5
Up next: Nothing scheduled
Analysis: Injury forced cancelation of fight with Dereck Chisora


6. Andre Ward
Points: 110
Record: 23-0 (13 KOs)
Title: WBA super middleweight champion
Last outing: W12 over Sakio Bika on Nov. 27
Previous ranking: 7
Up next: Vs. Arthur Abraham, date TBA
Analysis:Now the clear favorite to win the Super Six.


7. Juan Manuel Lopez
Points: 104
Record: 30-0 (27 KOs)
Title: WBO featherweight champion
Last outing: TKO8 Rafael Marquez on Nov. 6
Previous ranking: 6
Up next: Nothing scheduled
Analysis: Powerful puncher, entertaining style



8. Nonito Donaire Jr.
Points: 83
Record: 25-1 (17 KOs)
Title: Interim WBA super flyweight champion
Last outing: TKO4 over Volodymyr Sydorenko on Dec. 4
Previous ranking: 9
Up next:Vs. No. 10 Fernando Montiel on Feb. 19 in Las Vegas
Analysis: Dynamic puncher developing all-around game.



9. Timothy Bradley
Points: 82
Record: 26-0 (11 KOs)
Title: WBO super lightweight champion
Last outing: W12 over Luis Carlos Abregu on July 17
Previous ranking: 8
Up next:Jan. 29 vs. Devon Alexander in Pontiac, Mich.
Analysis:Win over Alexander would make him prime candidate for Pacquiao fight.


10. Fernando Montiel
Points: 43
Record: 44-2 (34 KOs)
Title: WBC-WBO bantamweight champion
Last outing: KO2 Jovanny Soto on Dec. 10
Previous ranking: NR
Up next: Vs. No. 8 Nonito Donaire Jr. on Feb. 19 in Las Vegas
Analysis:Showdown with Donaire will establish world’s best bantamweight.

Others receiving votes: Lucian Bute, 41; Bernard Hopkins, 35; Vitali Klitschko, 33; Paul Williams, 30; Pongsaklek Wonjongkam, 24; Yuriorkis Gamboa, 15; Miguel Cotto, 7; Israel Vazquez, 6; Devon Alexander, 5; Chris John, 5; Tomasz Adamek, 3; Anselmo Moreno, 1; Shane Mosley, 1.

Voting panel:Raul Alzaga, Primera Hora; Ron Borges, Boston Herald; Damian Calhoun, Orange County Register; Steve Cofield, Yahoo! Sports; Dave Cokin, ESPN Radio, Las Vegas; Gareth A. Davies, London Telegraph; Andrew Eisele, About.com; Steve Farhood, Showtime; Scott Fyfe, Sunday Post, Scotland; Thomas Gerbasi, BoxingScene.com; Nick Giongco, Manila Bulletin; Lee Groves, BoxingScene.com; Thomas Hauser, Seconds Out; Keith Idec, Herald News, New Jersey; Kevin Iole, Yahoo! Sports; Michael Katz, Gaming Today, Las Vegas; Max Kellerman, HBO; Scott Mallon, Boxing Digest; Rich Marotta, Fox Sports; David Mayo, Grand Rapids Press; Franklin McNeil, ESPN; Gunnar Meinhardt, Die Welt; Robert Morales, Los Angeles Daily News; Marty Mulcahey, MaxBoxing.com; Peter Owen Nelson, freelance; Santos Perez, Miami Herald; Martin Rogers, Yahoo! Sports; Cliff Rold, Boxingscene.com; Michael Rosenthal, RingTV.com; Lem Satterfield, Fanhouse.com; T.K. Stewart, Boxingscene.com; Paul Upham, Seconds Out; Dave Weinberg, Press of Atlantic City.

2010 Ring fan polls: Event of the Year

RingTV.com, in association with Yahoo! Sports, is offering boxing fans the opportunity to vote for their favorites from 2010 and determine a winner in eight categories.



What was the Event of the Year? Results to be revealed at www.ringtv.com.Pacquiao-Floyd breakdown Pacquiao-Margarito Mayweather-Mosley Pacquiao-Clottey Death of Valero

One category will appear each day on Yahoo! Sports and the result will be announced the following day at http://www.ringtv.com/.


Note: These are not the official Ring awards. Those will be announced in the magazine itself.


The following are the candidates for Event of the Year.


1. Manny Pacquiao-Floyd Mayweather Jr. failed negotiations No boxing event was talked or written about as much as the failure of the potentially richest fight in history to take place in 2010.


2. Manny Pacquiao-Antonio Margarito Nobody believed the disgraced Mexican brawler deserved a shot at Pacquiao but their high-profile showdown proved that controversy sells.

3. Floyd Mayweather Jr.-Shane Mosley Mayweather silenced his critics by facing the most respected and formidable opponent he’d fought since Oscar De La Hoya.

4. Manny Pacquiao-Joshua Clottey What was thought to be a mediocre substitute to Pacquiao-Mayweather drew more than 50,000 fans to Cowboys Stadium in the first boxing event held in the billion-dollar venue.

5. Death of Edwin Valero Controversial KO artist seemed poised to become a star but killed his wife in a tragic drug-induced meltdown and then shockingly took his own life in jail.