You don’t have enough time, money, or freedom and you want to solve that with passive income.
Who doesn’t?! In trying to get these things, you might think quitting your job to go into real estate investing is what you need to do. Right?
What you need instead is a paradigm shift.
Don’t Become a Real Estate Investor
A lot of people reach out to me and tell me they want to quit their jobs and stop being a doctor, dentist, etc. and start investing in real estate instead. These are very successful people who are making half a million dollars a year in their careers, and they want to start earning passive income.
I get it. I’m successful at real estate investing, but there is nothing passive about what I do. The truth is real estate investing is hard. The average expected return is about 8-12%. If you want to replace your million-dollar-a-year salary job with real estate investing, you would need 10 million dollars in investment capital to make a million dollars a year.
What you actually want to do is stop trading your time for money. When you’re trading time for money, you’re stuck in this hedonic treadmill of repeating the same task over and over. If you want out of the rat race, and to stop working 80 hours a week, you have to start thinking of things through a different lens.
Stop Trading Time for Money
The end goal is actually freedom. The reality is, if you’re the GP or the sponsor, you’re earning a very active income; it’s another job.
Developing a passive wealth machine, however, can help you find the freedom you’re after. In short, a passive wealth machine is something where you put a dollar in, and more than a dollar spits out. It produces without requiring more hours of work.
Not everyone likes this advice, but the passive wealth machine way of making money suggests you spend more time working in your vertical W-2 income and start living within a budget. Then, you can invest every dollar above your budget in your passive wealth machine. By doing this, you can start gaining compounding interest on your investment.
When that passive investment starts producing what you are making in your standard income, then you can finally quit your day job. But you have to make money in one lane first. The entrepreneurial blessing and curse is seeing the shiny new investment opportunity and diluting your focus. Stay the course. The best path forward to success is oftentimes the thing that you’re already successful at. Wherever you have high and significant levels of success, take the overflow of that success and pour it into your passive wealth machine.
How to Get More Time
Okay, maybe that sounds great, but you still want more time. I can’t give you back your time, but I can show you how to apply these same principles to your time.
In the same way that you invest your money so it can gain compounding interest, you can invest your time so it compounds too. Here’s an example: auto bill pay. It’s kind of a pain in the butt and you may spend two hours setting it all up, but that will save you 30 minutes every month. After four months you’ve broken even and you’ll continue to have 30 extra minutes each month moving forward. With this mindset, you can prioritize your time for things that will give you more time in the future.
Building a passive wealth machine gives you more money without requiring more time, so you’re not just trading one job for another. It’s better that you learn how to invest as a passive investor rather than becoming an active real estate investor. This is how you establish that freedom that you’re after while multiplying your time and return on investments.
Are you interested in learning more about building a passive wealth machine? Check out my Youtube video for more.
LinkedIn: Jake Harris
Youtube: Jake Harris