Step Four: Activate the Passive Mode of Making Money

Most people live a paycheck-to-paycheck existence, using this month’s income to pay off last month’s bills. Even people who have six-figure incomes still frequently follow this hand-to-mouth model of household economics. They make more money, but they spend it all on new things before they have a chance to save any of it. They’ll go back to work to pay for those new things, and the cycle will repeat itself. It’s crucial to remember that a paycheck – no matter how big it is – does not represent wealth or riches. Those who think that more pay equates to financial freedom are misguided.

Real success and wealth is only realised by those whose money works for them to generate passive income. When investments and businesses are generating positive cash flow and net profits, they add to one’s bank account constantly and continually. An entrepreneur with passive income makes money without even getting out of bed, and is rewarded with riches even while asleep.

Most people work an entire lifetime to accumulate enough assets and savings to generate meaningful passive income. Many work a lifetime and still don’t achieve it, so they are never truly free to retire and do whatever they please. Those who are lucky enough to reach their goal typically do so at age 65 or older, and by that time much of their life has already passed them by. Worse, they have less energy to passionately pursue their dreams.

Acquisition of assets is the main goal of most people, who hope that by gathering enough material assets, they will eventually be able to put those things to work to produce passive income. They buy real estate and wait for it to appreciate in value, or they run businesses and hope to continue growing them for life. They contribute to pension plans and retirement accounts, and sock away stocks and bonds.

But in order to streamline the process and take a fast track to wealth, people need to focus first and foremost on passive income. Profits and cash are the drivers of such earnings. Without them, nobody has enough free time to expand profit centres by opening new businesses, selling them for a profit, and then launching into other investments. The key to early retirement or rapid wealth is to build passive income throughout life, rather than trying to simply accumulate a portfolio of assets. If passive income is there, then the potential to acquire assets is made possible. but remember – just having assets isn’t enough to generate sufficient passive income.

Too many entrepreneurs put the cart in front of the donkey and then wonder why they are standing still or losing ground. Those who succeed in the short term do so by generating passive income that constantly works to produce wealth, whether the entrepreneur is at the office, on vacation, or sound asleep. To be truly rich, one needs passive income, solid material assets, and paper assets such as royalties, franchise fees, and shares in profitable businesses. All of these things start with strategies that generate passive profits.

Putting it All Together: Time and Money with More of Both to Spare

With a strong base of wealth that regenerates itself automatically without their input, an entrepreneur has plenty of money and oodles of free time. Their new and exciting challenge becomes one of creativity, imagination, and individual vision. Because time and money afford one the ability to make dreams come true, the advanced entrepreneur is a person who spends time dreaming up new ideas and watching them come to fruition.

Enjoying one’s ideal lifestyle becomes a full time occupation, thanks to the fact that it is possible to easily work 10 fewer hours each week without giving up productivity or income. If you repeat the formula, you’ll reap 20 free hours a week. Double that, and soon the nine-to-five schedule of most workers becomes transformed into 40 liberated hours of free time each week.

Following the four steps outlined above enables one to quickly reach full-time retirement with plenty of money for a pleasurable and rewarding lifestyle spent with family and friends.

This blog post is part of our ActionCOACH guide ‘Working Fewer Hours’ that can be downloaded here

For more advice and to gain some expert knowledge, book in for your FREE 30-minute coaching session with Mark Dilks HERE.