What Type of Income Do You Have?
There are only three known types of income in this world and these are first the earned or active type of income, second the passive type of income and third the portfolio type of income.Earned or active type of income is mostly the type of income that the majority of the world is having. This is the type of income you get from a safe and secure job as a result of going to school and getting good grades. This is the type of income where you work for money because it is obtained from the work that you have done. It is derived from active participation in trade or in business such as commissions, bonuses, wages, salary, and tips. This is the type of income that stops whenever you get sick or whenever you want to relax and take a vacation.
Know what type of income you should be having right now
The passive type of income is mostly derived from real estate investments wherein you are able to earn income even when you stop working or even when you go on a vacation break. Just take commercial buildings for example. When people rent these commercial spaces, you are going to receive income even if you do not engage in work or business because the commercial building itself is already giving you passive income. This is what’s good about this type of income because you are letting money work for you instead of you working for money.
Portfolio income is the type of income derived from paper assets such as bonds, stocks, and mutual funds. Portfolio income can also become passive if handled correctly. This leads us to conclude that both passive and portfolio income are the most ideal types of income to get rich compared to an active or earned income. Although you can still get rich with an active or earned income but the effort is not worth it especially as you age since you are required to work continuously for the rest of your life!
If you are currently having the earned or active type of income right now, do not worry because you can still become rich as long as you will be able to have the ability to convert it to the ideal passive or portfolio income ASAP.