Let’s say you had to retire today. How much money do you have to live on for the rest of your life? This is a question we should ask ourselves repeatedly. According to a recent study, most could not come up with $400 dollars without a credit card. Again, we can do better! How can we generate more passive income with a full time job? The answer is to seek out passive income streams, spend less, invest and free up time to allow you to think of more ways to generate passive income. Think dividends, rental properties, blogs, and spending less. Continually brainstorm ways to generate passive income, then automate the process. Finally, use passive income to invest and pay your living expenses.
Index ETF: Invest in low fee high diversified index ETFs.
- SCHA Schwab Strategic TR US Small-Cap 10 year +13.33%
- VIG Vanguard Dividend Appreciation ETF 10 year +14.44%
- VYM Vanguard High Dividend Yield ETF 10 year +15.57%
- VIGI Vanguard International Dividend Appreciation ETF 2 year 9.05%
- VYMI Vanguard International High Dividend Yield ETF 5 year 8.92%
- VOO Vanguard S&P 500 ETF 10 year +13.96%
Rental Properties: Typically an inflation hedge.
Blogs: Write blogs and advertise with affiliates.
Rent Your Car: Sites that allow you to rent an unused car.
Banking: Save more.
- Ally Bank around 2.2%
- CIT Bank around 1.5%
- Lending Club
- Cash-back Credit Cards
If you have nothing saved, your first goal is to go out and get $1,000 dollars. Search the couch for change, use windfalls, birthday money, get a side gig, Uber it, spend less, rent out a room, create a blog or whatever to get that first $1000 dollars. Can you find any extra spare change from your 9 to 5 job for investing? Move heaven and earth to get that first $1,000.
After you have the $1,000 dollars in hand, don’t deposit it into your savings or checking, it will get spent. Place it directly into your brokerage account. Automate the process, putting in small amounts, or as much as you can afford, in your brokerage. Build wealth, without thinking about it. Remember, every penny counts. Grow investments not things. Use passive income to grow profits. Once you have $1,000 invested, then turn it into $10,000, $100,000 and so forth.
How will you know when you hit the magic number? To motivate us to save and invest, we need to track progress. You can stay organized by using websites that track your net worth in real-time. Here are my favorites. If you are a member of Bank of America, there are a great set of free tools to track your assets, including home value based on Zillow, 401k, Roth IRA, savings, and so forth. BofA makes it easy with a single page that tracks everything. Plus, the company reputation is stellar for security. If you are already a BofA cardholder, take a look at the free tools.
Other favorites are Wealthfront and Betterment both have an excellent toolset for keeping on track. These companies are robo advisors. They automate the process of investing in index funds and ETFs. Both Wealthfront and Betterment are options to keep investing simple and free up time. These sites also have excellent methods for tracking all your accounts.