I read one book in 2010 , “Rich Dad Poor Dad”, which was clearly pointing out to increase your passive income source to be financially free. That book was written way back 1992, as far as I remember but It was a good book to understand the importance of Financial Freedom and the way financial success can be achieved. I came across the term “passive income” in that book. Today when I was reading an article, I again came across that work, So a quick thought came to my mind is, How can I generate passive income in India.
So, In this article, I am going to share a quick explanation of Passive Income Source and will point out those Passive Income source to earn money in india. These all are feasible source of Income which you can practically carry out in India.
Well, Some of my friends are unaware of the term passive income, So I am giving a bit explanation about the same.
What is Passive Income ?
Passive Incomes are those incomes for which you do not need to spend time directly or to make effort to get things done. All those income are regular in nature and on cash basis, you receive it time to time without hefty tasks. It includes, Royalties, Interest, Dividends, Rents ETC.
Advantage of Passive income sources :
It helps you to earn more,
It increase the probability of retiring early,
It upgrades your lifestyle on permanent basis,
It gives you an opportunity to work as you want,
It gives you a chance to leave daily job,
It pulls you out from cash traps.
It gives you opportunity to waste your money and learn from them.
Practical and Working Passive Income Sources In India
Property Rental Income + Capital Appreciation :
Income from rent is one of my favorite passive income source. You need not to work for it, or look after it regularly. It generates income automatically without any effort. If you have invested in good property in India then It’s very much possible that, You can get dual benefit, One is regular cash flow from Rent + Capital Appreciation in value of Asset. Because, Almost in all cities, Real Estate is booming like hell. I have seen some people who earned 8 times on their investment in Land. So, rental income is a good way to generate passive income.
Interest and Dividend Income :
Interest is the easiest way to earn passive income on investment in Bonds or Fixed Deposit. According to me , It’s not advisable in Indian market. When you earn 9% return on your investment and Inflation rate is galloping at the rate of 13-15% annually on necessities then I think, It’s not advisable to invest in such instruments which is making us loss of 3-4% in Real Value of Money. It’s not in the case of India, but mostly in any developing country it’s not good to invest in Fixed Deposits or bonds. They hardly beat inflation. On other hand, Dividend income is quite profitable. Investment in those shares which generates cash regularly on investment is really a good option. Again, It need fundamental analysis to decide where to invest funds so that share can generate regular dividend.
Investing or Trading :
I know, when I say Investing or Trading, you might think that, it not your cup of tea. Actually speaking, it certainly not an easy task but I assure you, It is lot less difficult than those analysts pretend on news channels. I am also learning how to invest in good stock, which is called “Value Investing”. Another approach is “Active Trading” which depends upon technical analysis. One can make good money from Share Market If he invest some precious time and get in to it deeply. I assure you, you will love it once you gain on you first contract. So, value investing and Active Trading both are the working ways to generate passive income or extra income.
Writing a Book and Getting royalty fees is also a wonderful source of Income. I know many young Entrepreneurs from India who have written good and inspiring books and Earning handsome Income. Some of them are, Varun Aggarwal, Rashmi Bansal, Chetan Bhagat, Manish Chauhan Etc. Certainly, If you are a writer by passion then develop your interest in such a niche that can reach to majority of Indian population, make some research on those area and write a book. Like Chetan Bhagat is doing 🙂 .
Affiliates Earning :
I have been into Internet Marketing space from July 2011 to September 2012. I have earned good income from affiliate sales. It takes only one time hard work and then It makes money on its own. When it comes to affiliates, It becomes bit technical, but surely you can earn from it. I will be focusing on this when I will start my career. Genuine sales and genuine earnings. Win-Win situation for all. 🙂
Cash Generating Business (Franchisee) :
Some of you might differ from this one, when it comes to passive income sources. But I believe, It’s also a passive source of income when you earn income by investing some money in franchisee and peak location restaurant. I have seen some people who just invested money and earning well on it by opening up Sankalp Dhosa, Cafe Coffee Day, Coffee Culture. According to me, They are not working on those Restarants, just their money are. So It’s a good source of passive income. Ofcourse some managerial skills of your plays role in this case but It’s okay 🙂
So, these are some areas from which you can get passive income. I want to tell some thing here, these are not source of Extra Income, This is a source of Passive Income which can generate earning without working for such things directly.
I hope, You have enjoyed my article, If you know any other source of Income then please let me know via Comment. If you think I am wrong at certain point then I would like to know about. Thanks.