Between WPBeginner, my Facebook messages, and the contact form on this website, I get at least one email a day where someone asks me about making a passive income online. Having made millions online, I’m still baffled by this concept of online passive income, so I decided to take a look at where these online passive income myths and lies are coming from. After I debunk those, I’ll talk about passive income opportunities and a strategy that I’ve seen working over and over again!
Since we’re talking about Passive Income, it’s best that we start with a definition. According to Wikipedia:
Passive income is an income received on a regular basis, with little effort required to maintain it.
Notice the emphasis on the word little effort (subjective term).
What does that really mean? Are those “experts” talking about online passive income explaining this “little effort” part?
I started to look around for resources that could be misleading people about building passive income online.
After a simple search, I came across a Forbes article about a blog, a Udemy course on “making money online”, and several list articles covering XX best passive income opportunities.
Some of these opportunities included creating eBooks, affiliate niche websites, blogging, membership websites, offering consulting services, building software, putting up website ads, etc.
Having SUCCESSFULLY and PROFITABLY done basically all of the above, let me explain how none of these are passive income, but rather can be great active income sources.
Online Passive Income is Bullshit
Yup I said it. Anyone who says otherwise either don’t understand the concept of passive income or is lying to make a quick buck by selling you one of their products.
Let me explain.
You see it’s not as simple as writing an eBook and it’ll sell on its own. Because in order to sell, you need traffic which requires regular work.
Creating affiliate niche websites and earning money while you sleep can happen, but only because you worked all day writing content, building backlinks, engaging with your audience, being part of communities. That sure doesn’t sound like “little effort”.
Same goes for membership websites, creating software, doing regular podcasts, blogging, and basically any online venture that I know of.
Now don’t get me wrong, you can definitely make money online (lots of it). But like any other business, it requires a lot of hard work, timing, and perseverance.
Passive Income vs Online Income (The Illusion)
I think of passive income like the definition says: recurring income generated with little effort. I have a few passive income sources:
- Interest from my bank account
- Dividends and Interests from my mutual funds portfolio
- NNN lease payments from several commercial real estate properties
These are true passive income sources because they require little to no effort.
So why do people confuse online income with passive income?
In my opinion it’s because of the flexibility and freedom that running your own online business offers.
Freedom #1 – You get to make money even when you sleep. This can be done in other businesses too – just hire people. Some online businesses allow you to do this without hiring anyone.
Freedom #2 – You can work from anywhere in the world as long as you have internet. Meaning you can go on unlimited vacations as long as you work. I call these workations and they’re fun.
When you’re used to of a 9 to 5 grind, online income sounds amazing – and it is!
But it’s not easy and it takes a lot of work.
Those who’re making 5 figures, 6 figures, and even 7 figures a month didn’t do it overnight. They’ve been working hard for years and continue to hustle every day.
I emphasize the word every day because it’s not passive. When you work 40, 60 or even 80 hours a week making a kick-ass living online, it’s NOT PASSIVE!
Heck even when you work 20 hours a week to make a recurring income online, it’s not passive income. It’s called a side job or a really good paying part-time job.
My strategy that works
Over the years, I’ve been blessed to build several successful online businesses.
You’re probably wondering why did I write this long rant? Well for two reasons.
First because I got tired of answering this question. Now every time someone asks me about passive income, I’ll send them to this post.
Second, because I want to better inform new users. Whenever you hear the word online passive income, QUESTION IT!
Ask them about their workflow? the amount of hours they work? Do your due diligence.
You’ll find one of the two things:
Those who are somewhat legit will quickly turn around and explain there is no such thing as 100% passive income. At that point, you know they were just using “passive income” as a buzzword or don’t fully understand the concept.
The others are same-old make money online scam.
I hope this article helped you understand the true definition of passive income, and why I don’t think you can make passive income online.