11 Observations

1. If you “open” your eyes, you will see “everything.”
2. Talk to “it”, not about “it!”
3. Communication is a crucial component in any relationship.
4. Understanding is the “truth” you stand under…
5. A Father’s reward comes much later. Good father’s aren’t even recognized until their gone.
6. There was a time that Ten dollars could get you by the week.
7. Don’t be great by yourself, even the Lone Ranger had Tonto…
8. Beginnings don’t like endings
9. Master where you are first!
10. Can you do without no one patting you on the back? Lack of acknowledgement?
11. Pay Attention.


The College Conspiracy


The College Conspiracy Full Documentary – College Conspiracy is the most comprehensive documentary ever produced about higher education in the U.S. The film exposes the facts and truth about America’s college education system. ‘College Conspiracy’ was produced over a six-month period by NIA’s team of expert Austrian economists with the help of thousands of NIA members who contributed their ideas and personal stories for the film. NIA believes the U.S. college education system is a scam that turns vulnerable young Americans into debt slaves for life.


Passive Income Series Pt.5: Commit to Your Passive Income Goal

Written By: Steve Pavlina

Now that you’ve set a specific passive income goal (as per the Set Your Passive Income Goal post), it’s time to strengthen your connection to this goal.

The idea here is to begin believing in your goal so that it becomes more real and solid, not just some airy fairy fantasy.

Put Your Goal in Your Face

Try this for starters. Grab a piece of paper, write your goal on the paper in a positive, personal, present tense format, and then post this piece of paper somewhere that you’ll see it every day, such as on your living room wall or your bathroom mirror. You can even post it in multiple locations if you like.

Based on my goal from the previous post, I came up with the following goal/intention statement:

I am now successfully creating a new stream of passive income by September 30, 2012, that generates at least $2000 per month on average and endures for a minimum of 10 years, and I’m doing this in a way that delivers strong value for many others around the world.

To make my goal more real and concrete, I copied and pasted the text above into a blank document, increased the font size to fill up the page (46 pt font in this case), and printed it out in landscape view. Then I tacked it up on the cork board in my home office. Now whenever I sit at my desk, I can’t help but see this goal since the paper is within my field of view. Even if I don’t acknowledge it consciously, my subconscious mind will be exposed to this goal repeatedly. I will keep the paper there (or use some other goal reminder) until this goal is achieved.

Feel free to embellish your goal with language you find attractive. I find it more motivating to set goals that provide value for others, so I added that phrase to the end of my goal.

This step is important because the natural tendency after setting a new goal is to drop the ball very quickly. Many people lose sight of their new goals within a week after setting them. They get sucked into various distractions, and the goal doesn’t take root. To prevent your goal from fizzling out, you have to keep giving it some attention, just as you would keep watering a plant.

I’ve written about this topic previously, so for more ideas on how to solidify your goals, read Keep Your Goals in Front of You.

Create Consequences for Failure

Another thing you can do to make your goal more solid is to create consequences for dropping the ball. Since I’m blogging about this along the way, it will be difficult for me to lose sight of this goal. If I quit or flub this up, there will be some negative consequences. Humiliations galore and that sort of thing.

If there’s no negative consequence for quitting, it will be easy for you to quit. That’s bad. We want to create more resistance to quitting, so that once you get going, it’s hard to turn back.

How you do this is a very personal choice, but if you’re not willing to do anything of the sort, then how committed are you really? If you’re committed to your goal, then it shouldn’t be a big deal to line up some extra sting for failure.

Quite often people will find the avoidance of the negative consequences more motivating that the positive benefits they’ll achieve. Instead of winning, some people become more focused when they really want to avoid losing. If the positive motivation for passive income was enough for you, wouldn’t you have already achieved your goal by now? You could have done this a year ago, such as by using the SBI service that I’ve been recommending for years.

If you’ve been interested in this goal for a while but you’ve been putting it off and you’re now telling yourself that you’re finally going to do it and that this time things will be different, why should anyone believe you? Do you even believe you? Or are you just trying to act confidently to convince yourself?

If the only consequence of failure is that you continue to experience more of your old reality, that isn’t much of a consequence, is it? After all, you’re already tolerating that kind of reality right now, so there’s no reason to believe you can’t keep right on dealing with it for another decade. But if turning back somehow looks nastier than going forward, you’ll very likely make some serious progress this time.

One suggestion is to find your biggest doubter and make a bet with him/her that you’ll succeed in achieving your goal by the deadline. If they’re willing to bet against you, this can  engage your competitive spirit and boost your motivation significantly. And if they refuse to bet, it can give more confidence since maybe it means they believe you’ll succeed. You can bet money, or you can make the consequences something more creative.

If you’re into politics, another idea is to promise to donate money to a candidate or political party that you hate if you don’t achieve your goal by the stated deadline.

Your ability to do this is partly a test of how confident you are in achieving your goal. If you struggle to make this sort of commitment, then what does it say about your level of confidence? If you’re truly going to achieve your goal, then the negative outcome will not happen.

When you do this, be careful not to create too much of a counter-force to your goal by mistake. You want to engage your competitive spirit if you find that helpful, but you don’t want to go so far as to incentivize others to sabotage your success. So if you promise a nice benefit to a bunch of people if you fail, you may motivate people to root for your failure and to withhold help they might otherwise have offered.

Involve Others

One more way to increase your commitment to your goal is to involve others in its achievement. Instead of engaging your competitive spirit, you can create a spirit of cooperation and teamwork. This is the approach I’m choosing to use for my new passive income goal.

I believe that we can all achieve our goals together and help and support each other along the way, so I wish to create a spirit of cooperation. I wouldn’t find it helpful to have people wishing for me to fail. I’d rather see all of us intending each others’ success as well as our individual success.

By creating and sharing a public series of blog posts on how to create passive income, I’m engaging other people in the achievement of my goal. A positive side effect is that I’m creating a resource to help others achieve similar goals. People generally appreciate this sort of thing, and I’m already seeing a lot of positive feedback on this series. I do appreciate the encouragement, which is very motivating to me.

If I did this as a private pursuit, I might find it harder to achieve my goal since I’m the only one who’d care about it. But by doing it in a way that invites more social support, it becomes easier. Yes, it’s more work to publicly share the steps along the way, but it also turns a solo project into a social one, which makes it more fun to work on. I also have more accountability to keep moving this series forward week after week.

Last week I took a mini-vacation that included a trip to Disneyland, and I didn’t do any blogging during that time. But I saw people posting on Twitter that they were looking forward to my next post in this series. By announcing this series publicly, I’ve invited others to hold me accountable and make sure I keep it going. I’m always free to take mini-vacations when I want, but other people are going to nudge me to move this along since they’re motivated to receive the value from it. I believe this makes it harder for me to fail. Making it harder to fail means making it more likely to succeed.

If you look at my situation and how I’ve set this up, you’ll probably agree that I should have some good motivation to complete this series and achieve my goal. Time will be the ultimate judge of course, but in the meantime, have you set up your goal with a similar amount of motivation and pressure? If not, this is the time to make those adjustments. If it’s too easy for you to drop the ball, you probably will. I’ve actually won money betting against people when I could see that they weren’t putting enough pressure on themselves to succeed.

Create Positive Stress

We know that too much stress is a bad thing. But we also know that too little stress is bad as well. There’s a sweet spot of stress between the extremes where you’ll feel motivated to take action. This positive form of stress is called eustress.

How else can you strengthen your commitment to your goal? How can you keep it in front of you? How can you make it more real and solid? How can you add more negative consequences for failure? Whatever ideas you come up with, act on them right away. It’s okay to be a bit impulsive here. As you do this more and more, you’ll learn what works best for you.

It often takes time for a new goal to sink in, so I encourage you to take this step seriously. This is not a difficult step. Creating and posting my goal reminder in my office only took a few minutes. You can do a lot with a short status update on your favorite social media site, such as by promising a negative consequence if you fail to achieve your goal by your deadline.

Surely you can spare a few minutes to strengthen your commitment.

If you decide to skip this step, my honest expectation is that you will fail to achieve your goal. If you make it easy and safe to fail, you probably will.

At this point you may be wondering when we’re going to get to the action steps. Where’s the how-to part? Well, we’re already into the action steps. This is very much a part of the how-to. We have to set things up so that you’re very likely to take action. How are the other steps going to benefit you if you only read them but you don’t actually do them? How many times have you read how-to info, said to yourself “I should do that,” and then dropped the ball? We need to avoid that kind of outcome.

My intention for this series is not to teach you the steps to generate passive income. That would be a waste of everyone’s time, and it’s already been done. My intention is that you actually create a new passive income stream for yourself. That’s the end result I want you to achieve. I’m writing this for the people who are finally ready to begin receiving some passive income this year. I’m not writing for the ones who are just curious about it. If you’re merely curious, that’s fine, but please don’t get in the way of us doers. ;)

Are You In or Out?

This is the point where you must now decide: Am I going to follow this series as an active doer or not? Am I going to follow along with action and create a new stream of passive income, or am I going to sit on the sidelines and watch other people do it?

If you aren’t sure, then you’re not a doer… at least not yet. Either get sure and commit to this, or this boat will sail without you. You may tell yourself that you can always come back to this series later, but will you? There’s some great energy in doing this in real-time with lots of others. That energy won’t be around six months from now. So I think it’s fair to say that it’s now or never.

You may wonder what this commitment will entail. Shouldn’t you learn the action steps before you have to commit? Nope. That’s not how it’s done. You commit first, and then the steps appear. What more do you need? I’m personally coaching you through this whole thing for free. I’ve already done this multiple times, and countless others have done it as well. It’s obviously a possible and achievable pursuit. And if you’re really committed, then even if I dropped the ball, you’d just continue on without me and learn what you need to learn elsewhere (just like I did).

Do you really have to commit in the dark? You’re not actually committing in the dark though. You’re the one who’s ultimately going to move this goal forward, not me. You’re the light source here. I’m just the helper you’ve summoned into your reality to help you create this now.

What’s the worst that will happen anyway? Even if you commit and fail, you’re still going to learn some amazing things along the way. You’ll see what you’re made of. Worst case you’ll suffer some negative consequences like a little embarrassment. Big deal. You’ll live.

So are you in, or are you out? If you’re not sure that you’re in, you can be sure that you’re out.

A year from now, what decision will you wish you made today?

Passive Income Series Pt.4 – Set Your Passive Income Goal

Written By: Steve Pavlina

As we transition into the how-to aspect of passive income creation, let’s begin by having you set a goal for what you want to accomplish here.

Why are you reading this series? Is it just for entertainment’s sake? Do you hope to learn something that you might apply later? Or do you actually want to create at least one new stream of passive income this year?

Let me suggest a simple meta-goal for starters: By the time you’re done reading this post, set a clear goal for what you want to gain from this series.

Do not close your browser window or move on to something else until you’ve set a clear and specific passive income goal.

No feeble excuses. No vacillating. No “I think about it later” B.S. And please no lame ass “I want more money” vague answers.

Whatever excuse you come up with as to why you can’t set a clear goal right now, we both know it’s stupid, so let’s not even go there. Not setting a goal is a waste of time.

If your actual desire is to create a new stream of passive income, then let’s make sure your goal includes 3 aspects:

  1. how much money you want to earn per month from your next stream of passive income (specific dollar amount)
  2. how long you expect that stream to last (number of years)
  3. your deadline for receiving your first month’s income from that stream

This isn’t your ultimate goal we’re talking about here. It’s the goal for your first (or your next, if you’ve done this before) stream of passive income.

If you have something different in mind that doesn’t really fit the parameters above, then by all means set the goal you feel is best for you. At the end of the year, when other people are enjoying their new streams of passive income, you can see how your own goal worked out.

The idea is to set a goal that’s motivating but that’s also believable for you.

If you’re telling yourself that you can’t earn any passive income because it’s too much for you, then your imagination needs work. You could put $100 in a free savings account and earn a trickle of passive income each year for decades. So don’t be lazy here. Don’t let yourself off the hook. Set a goal.

Goal setting is a skill that takes practice. If you fumble this initially and set a goal that’s too big and unbelievable for you, you won’t achieve it. If you set an unrealistic deadline, you’ll blow the deadline. How do you know what’s realistic? You calibrate with practice, just like you learned to walk and talk.

I don’t expect your goal to be perfect. That isn’t the point. The goal is just the first step to get you moving forward and taking this seriously. And the ultimate goal is to get good at setting achieving your goals. This means you have to risk making mistakes in the beginning.

As the saying goes, There never was a winner who wasn’t at some point a beginner. So begin by setting a goal.

My First Passive Income Streams

Other than earning interest on my savings account, my first real experience with long-term passive income was when I wrote and self-published a computer game for MS-Windows. I think I released it in 1995. It was a simple side-scrolling shoot-em-up game. I did the programming and artwork for it myself (I wasn’t much of an artist though), and my girlfriend at the time did the music and helped out with the sound effects.

The game didn’t sell particularly well. I put it up on my website, by my website had virtually no traffic. I also uploaded it to a bunch of free download software sites. I had a free demo with a couple of levels, and then people would get more levels if they bought the full version. Initially most of my sales came from people finding the demo on a game download site, and the demo would refer them to my website to buy the game.

I opened a Post Office box and started receiving mail orders for the game. Later I got a merchant account, so I could take credit card orders. Then I started accepting online orders. Eventually I set things up so that orders could be processed and fulfilled automatically.

On average I earned about $75 per month from this game. I didn’t do much in terms of marketing, other than posting it on my website and submitting it to those download sites, which was a one-time effort. Once the game started selling, I moved on to other projects.

This was a Windows 3.1 game with a fixed 640×480 resolution. It was strictly 2D, so there were no fancy 3D graphics or anything like that.

A year after I released it, the game was still earning about $75 per month.

Five years after its release, it was still earning about the same.

Ten years after its release, it was still earning about the same.

I varied the price of the game over the years, testing $9.95, $14.95, and $19.95. It earned roughly the same amount of money regardless of the price. I could sell 10 copies for $10 each or 5 copies for $20 each.

The game was initially available on 3.5″ diskettes, then on CD-ROM. More than 90% of the customers bought the instant download version.

I also did some licensing deals for this game with LCR publishers (LCR = low cost retail). These publishers found me as a result of finding my game on some download site. They’d put together collections of cheap games and sell them on CDs for under $10. I didn’t earn much money from these deals, but they gave my game wider distribution, and every copy included a link to my website.

Occasionally the game got some special attention, and there was a surge in sales where it might do double sales for a month. So overall it probably earned in the range of $10-15K over its lifetime.

It took me about 6 months to write and release this game. I had a lot to learn, so it was slow going. I got much faster as I learned and practiced. Writing a similar shoot-em-up game in 1998 only took me about 2 weeks, including the design, programming, artwork, and sound effects.

Eventually I released three more games at about the same level of quality. And again, each of these added another $75 month in passive income, so with 4 of these titles, I was up to $300 per month.

Finally I got smart and spent 6 months creating a much better game and put more effort into marketing it. It did $500 in sales its first month and was up to $2K per month a few months later. I kept building it up from there with two expansion packs and a deluxe version that sold for $24.95. The game did very well and dwarfed the results of my previous games. I also did more licensing deals for it, including one that had a minimum guarantee of $5K per month just from that one source.

I developed this hit game with a $0 budget. I did the design and programming, the artist worked for a percentage of royalties, so I created a passive income stream for him.

Then I went on to license and republish games from other developers, which created new passive income streams for them and me. Eventually I built up a suite of about two dozen games, which means two dozen streams of mostly passive income. Some streams were pretty good. Others were just a trickle.

In 2006 I finally took my games off the market when I shut down my games business. By this point I was earning so much more from StevePavlina.com that I didn’t want to divide my focus by keeping my games business going. But the passive income stream from these games helped me launch my personal growth business. My games income covered all my expenses while I got StevePavlina.com up and running.

Taking the Long View

Is $10K spread out over 10 years a good paycheck for 6 months of work? No, I could easily have earned more money working at a job. I was already earning more than that from contract programming work before I wrote my first independent game.

The point of creating your first passive income stream isn’t to achieve that big payout right away. The point is to learn how to create passive income streams, so you can get better at it. Then you can create bigger streams as your skills increase. Don’t expect your first effort to be your masterpiece.

Today I can create new streams of passive income with a lot less effort than I had to exert in the 1990s. The reason I can do this is because I put in the time to learn how to do this, and I’ve continued to refine my skills over time.

Don’t worry about how big your streams are in the beginning. If you can create a $50 per month passive income stream this year, I think that’s great. And it’s so much easier to do this today than it was back in 1995 when I first started, so you have it much easier than I did. Your cell phone is probably 100 times more powerful than the computer I used back then.

You also have me coaching you along the way. I didn’t have anyone coaching me at the time. Sometimes the people in my life suggested that I should get a job. They don’t say that anymore though. ;)

Do set goals, but be patient with your progress. This is a skill that will benefit you your whole life. Even if you work on this for 10 years, there will still be plenty more to learn.

My Passive Income Goal

As I mentioned previously, as part of this passive income series, I’ll walk you through the process of creating a new stream of passive income. And I’ll create a new stream for myself in the process. I haven’t decided what that will be yet, but I’m sure I’ll come up with something. Coming up with ideas is easy.

But for now, the goal has to come first. Since I want to keep this simple and not overcomplicate things, I’m going to set what is for me a relatively conservative goal:

I create a new stream of passive income by September 30, 2012, that generates at least $2000 per month on average and endures for a minimum of 10 years.

So this means creating a new stream that earns at least $240,000 over the next decade.

This seems like an achievable goal for me. I’ve already created multiple streams of this size and larger, so it’s not a stretch to believe that I can do it again. In this case the challenge will be to explain all the steps as I go along, which I’ve never done before. I want to keep this goal fairly basic, so I can focus on the teaching aspect.

Having a clear and specific goal helps me transition to thinking about the how. Now I can start pondering ways to do this.

This also helps me rule out what I can’t do to create this income stream. I can’t just do more public workshops or paid speaking since that’s active income. I want to set something up once and have it generate monthly income for at least a decade.

What happens if I don’t make the deadline? Nothing. I’ll set a new deadline. The deadline is a focusing mechanism. I could create a new passive income stream within a couple weeks if I want to. And I’ll probably create other streams along the way that I don’t blog about. But for this stream, I want to take it slow and explain the process in detail, so you can follow along. But I also want to keep moving towards some kind of release. I don’t want to get stuck in perpetual idea mode.

Your Passive Income Goal

The key to goal setting is to get into the habit of setting and achieving goals. It’s not to set aggressive targets that you never reach. You can always set a bigger goal later once you achieve the original goal.

Sometimes I’ve set a big goal with a 2-month deadline, and I achieved it during the first week or two. So I celebrated that. Then I set a new goal with a new deadline.

As long as the goal seems motivating to you and it helps you get into action, then I’d say it a good goal for you.

My suggestion would be to set a goal something like this:

I create a new stream of passive income by December 31, 2012, that generates at least $100 per month on average and endures for a minimum of 5 years.

I think this is a very achievable goal for most people. You don’t need your own website to earn this much.

Now some people will blow this goal out of the water; it will be way too easy for them. Other people will find it a serious challenge. Feel free to adjust the goal to something that feels good to you.

If you were to achieve the goal above, you’d put at least $6K in your pocket, but it’s not the amount that matters. The real aim is for you to learn how to create a $100 per month stream of passive income. Once you learn how to do that, you can surely do it again. Do it 10 times, and you’ll earn $60K passively.

Once you learn how to earn $100 per month in passive income — by actually doing it, not by reading about it — then it’s not that difficult to learn to create bigger streams. So instead of creating 10 streams that collectively generate $60K, you might learn how to earn that much with just one or two streams. As you continue to develop your skills in this area, you’ll discover how to earn larger sums with fewer streams and less effort. If one stream dies, you’ll also know how to replace it with a new one.

I’m pretty comfortable creating streams that earn around $50K per year. When I had third-party ads on this website several years ago, one of those streams was earning more than $100K per year. Once you get the hang of this, I think you’ll find it a fun challenge to create new streams of income and to experiment with different approaches.

If you want more long-term financial security, you won’t find it in the money or even in the streams of passive income. You’ll find it in building your own knowledge and skills. You can take away all my streams of income, my website, my assets, etc, and I’ll be able to recreate the same level of financial abundance in a relatively short period of time because I already know how to do it.

This is what I want for you as well. I want you to learn how to do this, so then you’ll always have that option available. This know-how will relieve you of much financial pressure. You won’t have to scramble to get a job to pay your bills. You can just create more passive income streams if you want more money.

Do It Now

You are NOT done reading this post until you’ve set your goal and have written it down. If you haven’t done this yet, do it right now.

Once you’ve done that, I encourage you to also post your goal in public — IF you can do this in a place where you feel that people will support and encourage you.

I’m sharing my goal publicly since I expect that many people will want me to succeed since they’ll benefit from the educational value. Watching me try and fail wouldn’t make for a very interesting series. I’ve also seen plenty of positive feedback popping up already, so I know that there’s a lot of interest in this series.

If you expect mostly positive support, then share your goal on your blog, your Facebook page, etc. Add some accountability and commitment like I’m doing. This can help motivate you to succeed, and you’ll inspire others to develop this skill too.

If, on the other hand, you anticipate a largely negative response if you share your goal publicly, then you have a different challenge to address. This means your life is filled with too many incompatible people. You have too much social drag. These people are only going to get in your way, so if you don’t think you can win them over, then drop them. Block them, unfriend them, etc.

If other people have a problem with your setting a goal in this area, what are they going to be like when you actually succeed? They’ll probably get worse, and then you’ll have to deal with problems like pettiness, jealousy, sarcasm, neediness, and more. Better to cut them out now and fill your life with positive support. Let them learn from your example… from a distance.

Prepare to succeed. Expect to succeed. Know that once you’ve set this goal, you’re going to achieve it. And if you’re going to achieve it, then you need to start shedding from your life whatever would otherwise get in the way of your goal. Whoever can’t handle it, drop them. This will create space to invite much better relationships with people who will support you on this path. The dead weight must be shed, so that positive support can come through.

Passive Income Series Pt. 3: The End Game of Passive Income

Written By: Steve Pavlina

Let’s talk about the reality of what it’s like to create streams of passive income and how it compares to working at a regular job. What I’ll share here may surprise you.

With a typical job, you’re more or less directly trading your working hours for dollars. You may receive an hourly wage, a salary, and/or bonuses for the time you put in at work. Your ongoing pay depends on your continued presence at work. If you stop working, your paycheck stops as well.

With passive income you’ll often get paid nothing at first. Initially you work to create and/or leverage a system that generates a flow of income long-term. Once your new income stream is launched and the passive phase begins, you may not have to work very much at all beyond that to maintain the stream.

Passive income is one strategy among many for earning money. It doesn’t necessarily dictate any particular choice of careers. You can do many different types of work and use passive income strategies to monetize your work.

Passive vs. Active Income

Suppose you’re a writer. One way to earn active income would be to get a job writing for a magazine or newspaper. You could get paid to write articles which your employer publishes and owns. You would receive a wage from your employer for the service you provide. If you stop writing in this scenario, you’ll stop getting paid.

Now suppose you offer your writing skills as an independent contractor. You market and sell your services to people and businesses. You do this on a “work for hire” basis, getting paid for each job you complete. This is also active income. If you stop working, your income ceases.

Now suppose you write a book and sign a publishing deal with a book publisher. The publisher gets your book into bookstores and also sells it online. They send you royalty checks twice a year based on sales of the book. You receive a percentage of what they receive for every copy sold. Five years later you’re still receiving checks from them. Your royalties are passive income. Even if you stop working after your book is published, you’ll continue to receive royalty payments for the book that did get published. You could potentially continue to receive these payments for the rest of your life. Your book may eventually be purchased by people who aren’t even born yet.

Notice that in each scenario, your underlying career is essentially the same. You’re still the same writer. You’re just using different strategies for earning income. You could even apply all three strategies simultaneously, working at a regular job, doing contract work on the side, and also writing a book and getting it published.

At any time you’re free to use active income, passive income, or hybrid strategies — or any combo of these you wish. You don’t have to quit your active income job to set up streams of passive income. For some people this is easier, however, since a regular job can chew up a lot of time, making it harder to find the time to create passive income.

Sometimes you can even get paid to create your streams of passive income. For instance, our writer may receive an advance for his/her book from the publisher. So not only does this writer earn long-term passive income, but s/he also gets paid to set it up.

Where Does Passive Income Lead?

I want you to start thinking about how your life would be impacted if you took the time to create some streams of passive income. Suppose you succeed. What then?

What would your life be like if you were receiving an extra $100 per month in passive income? What about an extra $500? $2500? $10K? 50K?

At what point do you shift from that wouldn’t make much difference to that would be nice? Then when do you think, That would really take off some pressure?

What amount nudges you into I could live off of that amount? Then when do you think, Wow… I could really upgrade my lifestyle with that?

And if you want to think beyond that, where do you start thinking, Hmmm… I wonder what I’d do if I earned that much without having to do anything? What would I actually do with my time then?

It may surprise you that one of the reasons people avoid earning passive income is the fear that arises from being confronted with that last question. People often spend so much of their lives distracted by the daily grind of work, bills, and social obligations that they rarely give much thought to the bigger questions. Suppose you actually do succeed here in a big way? Then what?

If your end game looks bleak, empty, and meaningless, that’s going to hold you back. You’ll sabotage yourself before you get very far.

Will Passive Income Make You a Bigger Success or a Bigger Failure?

If you didn’t have to work and money kept flowing to you month after month, what would you do with your time? Would you play video games all day or do drugs or sit around watching TV and eating?

I actually found it pretty difficult to succeed in creating passive income until I was able to answer these questions seriously. My answer changes from time to time, but the core is that I want to spend my life growing, creating, and sharing. I want to keep adding something of value to the substance of the universe. Whenever I keep doing that, regardless of how much money I’m making, I feel happy and fulfilled.

The irony is that if you answer this question honestly, you’ll probably come up with something that you could just as easily do when you’re broke, although perhaps not at the same level.

Because of my passive income streams, I can afford to be really lazy if I wanted to. I could sit around doing nothing for weeks on end, and my bills would still be covered. For some people this may sound like paradise, but it presents its own challenges. If you’re not careful, you could easily slide into a serious depression in this kind of situation. People receive a lot of fulfillment from work, but if you no longer have to work, will you still be able to motivate yourself to tackle new challenges, or will you do little or nothing because you can?

Many people have created passive income streams that cover all their expenses, and they ended up depressed and listless. Some try to keep the treadmill going by creating even more passive income streams, but their hearts just aren’t in it, and they eventually burn out.

What’s Your Motivation?

When I was broke and deep in debt and about to declare bankruptcy, I asked myself what I’d want to do with my life if I knew for certain that I’d always be broke. That was an interesting question because it helped me get past the momentary distractions of money and bills that always seemed to be at the urgent forefront of my reality. I realized that what I really wanted to do with my time was to create and share. I noticed this was something I could always do in some fashion regardless of how much money I had. This shift in mindset allowed me to increase my happiness and fulfillment, not to mention turning around my financial life, in less than a year.

This mindset also helped motivate me to create passive income streams because the more I did that, the more I got material distractions out of the way, and the more time I had for creative projects.

My life flows nicely when I remember to use my time for creative endeavors like writing, speaking, and creating workshops. It doesn’t flow so well when I allow myself to feel like I’m swimming in time with nothing meaningful to do.

It may seem premature to think about this now, but I think it’s pretty important. If deep down you know that the end game of creating passive income is going to be a bust for you — that you’ll just end up living like a big loser day after day — then will you really be motivated to get there? That would probably require a lot of pushing and force to get yourself to take action.

If, on the other hand, you can envision a pleasant and fulfilling end game scenario, I think it will be much easier to create passive income streams in a more peaceful and flowing way. There will still be work to do, but at least you won’t be internally fighting yourself along the way.

If anything stops you from earning passive income, what will it be? It’s undoubtedly going to be something inside you. The external action steps are certainly doable. You may screw things up in the beginning — I sure did! — but if you persist and learn from your mistakes, it’s largely a done deal that you’ll succeed. As I mentioned in a previous post, people were earning passive income thousands of years ago. Surely you can learn this as well. So the only thing that’s really capable of stopping you here is you.

Beyond the Hype

I know there’s a lot of hype around passive income. Yes, it’s cool. Yes, it can relieve a lot of financial pressure. Yes, it can make a big difference in your lifestyle. I must say that a lot of the hype is true. As Earl Nightingale said, “Nothing can take the place of money in the area in which money works.”

But suppose you really get there. Suppose you cover all your expenses and then some with passive income. Then what? What will you do with your time? And will you be truly happy doing that, year after year and decade after decade? Or will you feel even more lost than you do now?

Here’s what I suggest. Write down a little vision statement for yourself, perhaps a few sentences or a paragraph about how you’d choose to live if all of your expenses were covered by passive income, and you didn’t actually have to work to pay the bills.

Then set that statement aside, and look at it tomorrow fresh. Now ask yourself if you’d really be happy in this scenario. If you don’t think you’d be very happy there, rewrite your statement. Try to get clear about what your personal end game of passive income looks like. See if you can create a scenario in which you’re very happy.

Finally, if you aren’t already doing what you wrote in your vision statement now, then why not? Could you still do it in some capacity under your current conditions if you really wanted to?

Money is Fuel, Not a Cure

You see… if you’re holding yourself back now, then why wouldn’t you continue to hold yourself back even after you’ve created your abundant passive income streams? If you allow yourself to use lack of money as an excuse today, you’re just going to use a different excuse when you have more financial abundance. Money is no cure for the willingness to succumb to feeble excuses. So if you see this pattern in yourself, then I suggest you start working to overcome it today.

Money is more multiplicative than transformative in its effects. It makes you more of who you already are. So if you’re the kind of person who will excuse yourself from a bigger vision today, adding more money to this situation will only make things worse. Many people who have lots of money also have many more obligations to use as excuses. The excuse making doesn’t end with more money; it only magnifies.

It may seem like having lots of free time to play is a great thing, but a playboy/playgirl lifestyle probably won’t create much fulfillment. More people seem to find fulfillment in meaningful work. Yes, you can still play and travel and all that good stuff. But give some thought to what work you might wish to pursue if you didn’t have to work for money at all. This is an important question to answer. Equally important is to ask: Why aren’t you doing this work right now in some fashion?

I personally feel that the #1 benefit of having my expenses covered by passive income is that I get to keep doing a lot more of the kind of work I enjoy. I also get to work the way I want to work — where I want, when I want, how I want, and with whom I want. But in order to maintain those feelings of fulfillment and meaning in my life, the work must continue. I can’t just go into perpetual play mode and check out.

I think you’ll find that if you’re already living your bigger vision in some capacity, then creating streams of passive income will be a lot easier. These streams will help you expand your vision and overcome distractions.

But if you’re currently using feeble excuses like the lack of money, lack of time, or the obligations of your day job to distract you from a bigger vision — even as you somehow still have time for Facebook, texting, email, reading blogs, watching TV, etc. — then I’d bet that you’re not going to succeed in creating much passive income; you’re the type who will come up with an excuse to quit, and even reading this series is just another distraction for you.

So whatever it is that you think you might start doing once you’re already living the dream of total financial abundance, start doing that now in some fashion. Insert it into your life, even if it’s just for a couple hours a week to start. If you don’t have time for it, quit Facebook, give up TV, and cancel your texting plan.

New Year Prep: Three Things to Do Everyday

As we get ready for the year of 2014. I thought this video would got you thinking. I hope you enjoy Jimmy Valvano’s 1993 ESPY Speech. “Don’t give up .. . Don’t ever give up.”®

The V Foundation for Cancer Research was founded in 1993 by ESPN and the late Jim Valvano, legendary North Carolina State basketball coach and ESPN commentator. Since 1993, The Foundation has raised more than $115 million to fund cancer research grants nationwide. It awards 100 percent of all new direct cash donations and net proceeds of events directly to cancer research and related programs. The Foundation awards grants through a competitive awards process strictly supervised by a Scientific Advisory Board. For more information on The V Foundation or to make a donation, please visit http://www.jimmyv.org.

New Year’s Prep: A Dollar and Some Ambition

Jim Rohn motivational speaker and author Each of us has two distinct choices to make about what we will do with our lives. The first choice we can make is to be less than we have the capacity to be. To earn less. To have less. To read less and think less. To try less and discipline ourselves less.

These are the choices that lead to an empty life. These are the choices that, once made, lead to a life of constant apprehension instead of a life of wondrous anticipation.

And the second choice? To do it all! To become all that we can possibly be. To read every book that we possibly can. To earn as much as we possibly can. To give and share as much as we possibly can. To strive and produce and accomplish as much as we possibly can. All of us have the choice. To do or not to do. To be or not to be. To be all or to be less or to be nothing at all.

Like the tree, it would be a worthy challenge for us all to stretch upward and outward to the full measure of our capabilities. Why not do all that we can, every moment that we can, the best that we can, for as long as we can?

Our ultimate life objective should be to create as much as our talent and ability and desire will permit. To settle for doing less than we could do is to fail in this worthiest of undertakings.

Results are the best measurement of human progress. Not conversation. Not explanation. Not justification. Results! And if our results are less than our potential suggests that they should be, then we must strive to become more today than we were the day before. The greatest rewards are always reserved for those who bring great value to themselves and the world around them as a result of who and what they have become.

To Your Success,
Jim Rohn

Passive Income Series-Pt.2: What Is Passive Income?

Written By: Steve Pavlina

I want to kick off this passive income series by clarifying what I mean by passive income.

I prefer to define passive income fairly broadly as revenue you earn even when you aren’t actively working. Another name for passive income is residual income.

By contrast active income is money that stops coming to you when you stop working. If you get paid a salary and you quit your job or get laid off, most likely you’ll stop getting paid. You may get a severance package to help you transition, but your boss won’t keep paying your salary unless you keep showing up for work.

Similarly, if you do contract work for clients who pay you, and if you’ll stop getting paid if you stop doing this work, that’s also active income. You may have more flexibility with contract work, but you still have to do the work to receive your payments.

With passive income, you would keep getting paid whether or not you do any meaningful work. You may do a lot of work up front to get the ball rolling, but eventually you reach a point where the passive income stream gets activated. At this point you can essentially stop working on this income stream if you so desire, and more money will keep flowing to you through this stream regardless what you do or don’t do.

Passive income doesn’t mean one-time lump sum payments such as an inheritance or the sale of an asset like your home or some stock you own. Passive income is a source of income with some sense of continuation over time.

Passive income doesn’t mean permanent income. Some forms of passive income may last a few years. Other forms may keep going for decades or even for centuries across multiple generations. But all forms of income eventually dry up for one reason or another.

Passive income doesn’t mean 100% secure income. As Helen Keller wrote, “Security is mostly a superstition.” Some forms of income are more secure than others, but there’s always a risk element. For any income source, there’s a non-zero probability that something could destroy it. This is one reason it’s often wise to create multiple streams of income, so you can reduce the risk that all of them will fail simultaneously.

Passive income doesn’t mean perfectly 100% passive with no maintenance required. With any income source, you may need to do a little maintenance to keep it going. Sometimes this is really easy and only involves checking your mail and depositing checks. Sometimes it’s even more passive when the money is deposited directly into your bank account every month. But then you may still need to report this income and pay taxes on it.

Passive income is really a spectrum of possibilities. Some income streams are very passive. If you do essentially no maintenance on them for years, the income will keep coming. My book royalties are one example of this. Regardless of what I do or don’t do, most likely Hay House will keep selling my book, and people will keep buying it. Even if I shut down my website and go incognito for some reason, my book can keep selling online and in bookstores. All I need to do is deposit the royalty checks. I don’t have to process orders, interact with customers, or do any ongoing marketing.

Other income streams are semi-passive. You may need to do some work to maintain them even if you’re not working for a salary. For example, if you own a house and rent it out, you may earn passive income as rent payments from your tenants. But you may also need to invest some time, energy, and money to maintain the property, to find new tenants when the place goes vacant, and to handle the mortgage, insurance payments, and property taxes. If your tenants get ornery or become delinquent, you may need to do even more work. You may delegate much of this work to someone else, but then you have a business partner or employee to manage instead.

Passive income doesn’t mean it’s passive for everyone. There may be other people with regular jobs who do some of the work that enables you to receive passive income. You may also leverage technology to do a lot of work for you. The level of passivity is perspective dependent. One person’s passive income is another person’s active income.

I also want to distinguish passive income from what I’ll call moocher income. Moocher income is what people try to earn when they succumb to a get rich quick mindset. This is an undisciplined attitude that seeks to get something for nothing. The idea is to find a way to mooch money from people or the economy without providing any meaningful value. It is possible to generate income this way since markets contain plenty of inefficiencies, but it’s not an approach I recommend. I don’t personally define passive income to include moocher income, but there is a spectrum here where some forms of passive income deliver more value than others.

In this series I intend to help you create passive income in a way that generates good value for others. This is more sustainable in the long run, and it’s better for everyone. Fortunately there are lots of ways to create value.

That said, this isn’t a series for the lazy ass delusional types who spend six hours a day playing Angry Farm Ninja Madness. Nor is this series intended for the desperate “I need to make $500 by Friday to pay my rent” nutters. Creating passive income streams is work. You can meditate on abundance, invoke the Law of Attraction, and pray to Hestia all you want, but also expect to do some real work if you’re going to make passive income a reality for you. Creating streams of passive income is a very active endeavor. You must do the work first; then you can enjoy the results.

P.S. If you do wish to pray for assistance, don’t pray to Hestia unless you want a baby or need to start a fire. Pray to Hades (aka Pluto) since he’s the god of wealth.