Passive income is not always easy to develop ínfima to you might lose money trying to create it. So in this post I want to show you how I currently make passive income and how you can start creating passive income for yourself.
Keep in mind it is not easy to create passive income with that in mind, what ever trade you want to go into, study first by reading books. This will reduce the risk in creating passive income.
Stocks can be one of the most passive investments, depending on how you invest. I prefer investing for the long run because slow and steady wins the race. So one of the main factors I like to see when I invest in stocks is dividends.
Dividends are company earnings that are annually distributed amongst shareholders.
Also in some cases dividends is handed out monthly, so make sure to really study your stocks by using www.sec.gov. From the SEC website you can search up company records, all you need to do is go to the search tab and type in “EDGAR SEARCH,” once land on that page type in the company’s name or ticker symbol.
HIGH YIELD SAVINGS ACCOUNT
High Yield accounts are easier to find but to make a significant amount from interest, you have to have over $10,000 in the account in my opinion. These account are made to give you higher returns compared to a regular savings account or bank account.
Remember this is less risky, when it comes to making passive income, so the returns are not really as big as stocks. What I suggest is to create an account just so you can have money ready to use for convenience but still have money working for you by paying you interest.
There are plenty of places to collect royalty fees, just to give you an example for “The Way I Save” one of the sites that the blog collects a royalty fee from is merchandise. Teespring is a good site to create graphics that can go on any product and if someone purchases your product you collect a royalty fee.
Now each product can give you more or less money the profit margin varies, but it’s fun and simple to set up. If you want to see an example on how it looks click over to the products page of “The Way I Save” located on the menu tab.
So I don’t know about you but P/E ratio is very important to me, which is why in this post I want to break it down to you on why it’s important and what it is.
I can tell you firsthand P/E ratio has changed my way of thinking when it came to investments, because it allowed me to learn more about the company in general.
P/E RATIO IS…
The P/E ratio is a simple break down of the business answering one question “Is this company profitable,” but just as a disclaimer there are other ways to tell if a company is profitable.
Just by looking at the P/E ratio should give you and indicator of what the company is worth and if it’s overpriced. As my rule of thumb I like to look at companies that have a P/E ratio less than 15.
WHY IS P/E IMPORTANT
P/E is important because the only reason investors buy stocks is to receive dividends or increase their capital. If a company has been profitable for 5-10 years and would you invest in that company?
Each sector has a P/E ratio that sometimes averages higher than 15, which doesn’t always mean their over priced. I particularly like to receive dividends and the companies that pay a good dividends are usually undervalued. The reason undervalued companies pay is because they need more investors to help fund their expansion. So to keep the investors happy the undervalued companies hand out dividends so you won’t leave.
I hope this post helped you out.
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THE WAY I SAVE
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Every good business and rich individual knows how to do one thing very well. Successful people probably don’t touch on this topic a lot, but the route of financial success is simply good money management skills. Managing your money can be difficult at times, but although it’s difficult it can be simple too.
This post is going to be dedicated in showing you simple ways to manage your money, so that you can have the keys for success.
I know a lot of influencers talk about paying yourself but they don’t particularly share how they pay themselves.
these are the ways I pay myself weekly and sometimes monthly:
• my 401(k) plan
• buying stocks
• other investments.
Essentially I take whatever is left in my savings accounts and use it to do one of these three things. Now since my 401K is already taken out of my paycheck, I really just use my savings for the other two.
I know a lot of peoples method or system when it comes to their personal finances, is to simply cash the check and stuff it in a box. Cashing your check is the worst method or system you can use, as Grant Cardone says “cash is trash.”
This is true because it doesn’t pay to have cash, it pays to have assets.
My personal method or system for handling money, is to deposit everything I make into my savings account. All I do is deposit and transfer for bills, that way after paying my bills I’m able to see what’s left for possible investments.
You don’t have to use this method, all I’m saying is that this works for me so you should try it and see if this system works for you. You can create any method or system for yourself as long as your know how you spend money.
These are just a few concepts I use I hope this helps you when it comes to your personal finances. Like I said from the beginning managing money can be difficult but also simple, so I hope these concepts were simple enough for you.
You can let me know if these concepts work by leaving a comment on this page.
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THE WAY I SAVE
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When it comes to choosing a stock EPS is the most important thing to look at before investing and in this post I’ll give you reasons why its important and I’m going to explain what EPS is.
Well for starters EPS stands for earnings per share.
One of the main reasons why EPS is so important, is because EPS will let you know whether or not a stock is worth investing in.
A higher EPS shows investors that a company is profitable. When a company is profitable it’s more likely that the investor will receive dividend payments from the company.
When the “earnings per share” increases 25 percent, it also reflects a higher demand from the company. This can be because of the rising popularity of the company or an increasing need for the companies products.
For example, have you ever heard of “Zoom” before the pandemic. In 2020 the eps for Zoom was calculated at 0.27, in 2021 it went all the way up to 2.91, that’s over 25 percent.
When the earnings per share for the company increases each quarter it represents future profitability for the company or consistent growth.
Before I purchase a stock I look at the estimated earnings per share and the actual earnings per share for each quarter. If a company passes its estimate earnings each quarter it shows The consistency of it’s performance.
Their are plenty of other reasons why EPS is important but these are the main reasons why you should pay attention to a company’s Earnings per share.
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I’m sure everybody’s heard of the saying buy low and sell high and that’s not just for the stock market that’s for every single thing you purchase. In this post I want to let you know about ways to leverage your money. I’m going to be sharing the ways that I personally have considered or successfully done myself.
So without further ado the first way to leverage money is with books. I have personally invested in several books like for example stock market 101, The intelligent investor, and the richest man in Babylon. With this investment of $57 in just these three books, I have made over a thousand dollars in 6 months.
This is just one example of how reading or listening to books can actually leverage your money. I am still utilizing the information used in these books today, which is also proof that it is a long term investment.
When it comes to courses it is another way to leverage your money, but you have to be careful when it comes to choosing of course. I say this because there are courses that charge an arm and a leg for information that could’ve been provided somewhere else cheaper.
Also you have to be strategic when choosing a course what course can you take that can translate into more money for you. For me it was taking an accounting course to help increase my know-how of budgeting and maintaining my personal finances.
Finding mentorship can be priceless and offered for a little to no cost, but there are people in places that charge you for their mentorship.
My advice is to start start with who you know and find people who invest their money in particular ways.
For me I have found plenty of mentors to draw near to who invest in real estate that are not only willing to share what they know, but are capable of partnering with me on deals.
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The Way I Save
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Many people create goals they want to accomplish at the beginning of each year. Some people accomplish these goals, others forget about the goals that they have set for themselves. The most successful people break down their goals into realistic task and give a time frame for the goal to be completed. If your new year resolution was to make more money this year, then you clicked on the best post for you.
In this post we’re going to break down your goal into making more money into realistic task but first lets be clear about the time frame. We want to complete this goal before the next year, so lets make this a 10 month goal.
TASK NUMBER 1
What are you passionate about and why? When you figure out what you are passionate about you will be willing to work more hours during the day. When you figure out why you are passionate about something it prevents you from getting burnt out or tired, and if you do get tired then its not a big enough “why.”
You don’t have to think too hard to realize what your passionate about because chances are you want to change peoples lives. So all you have to do is figure out what part of peoples lives you want to change. For example, I want to change the way people operate their personal finances so they can have financial freedom. The reason why I want to do this is because 80% of America is in debt and 55% of that debt is in credit cards.
So now that you know you want to impact peoples lives, and what part of their lives you want to impact, figure out how your going to impact them. Is it going to be through books, seminars, music, or a podcast.
TASK NUMBER 2
Supercharge your learning, when you find out what service your going to do, you need to learn more about the service (do not sell yourself short when it comes to the price of your service and do not overprice it.) You need to have a strategic method of learning too, so when you find the service you want to provide ask questions like how? Where? Why? and Who? Then learn the answers to each question. Start with the basics learn how to find the right people to partner with to eventually form a business, you need marketing, accounting, and specialist in the field.
TASK NUMBER 3
What ever money you have now, chances are your going to need more. So find things to flip, sell, or invest in that will give you enough cushion to start your business. I didn’t say it will be easy, but it is doable. Simple ideas to flip would be cars, shoes, or furniture.
I hope you enjoyed reading this post and I also hope it inspired you.
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The Way I Save
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Last post was about how to simply manage your money, this post is going to touch on where you should store your money. If you haven’t found out yet, saving your money at a bank only gives you a return of 0.01%.
That means you get ten pennies for every $1,000.00 you save. That’s ridiculous, but don’t worry there’s better ways that are just as safe and give you higher returns. In this post I’m going to share a few that I was able to try.
HIGH YIELD ACCOUNTS
If your not into risky investing you can still get a good return on your money, while keeping your money at the bank. For instance, synchrony offers you 0.55% for storing your money with them.
I believe the best high yield account out right now since the pandemic is Brinks. Brinks is offering 5% for storing your money with them.
You don’t have to buy stocks to make money, some brokerage accounts give you interest for storing your money with them.
If you have under $10,000 TD Ameritrade will give 1.25% for storing your money with them in a brokerage account, this interest rate might vary.
BITCOIN SAVINGS ACCOUNT
The last way I recommended storing money, is with Bitcoin savings account. For this account you have to own a type of crypto currency that the account accepts, and have an up to date digit wallet for storing the coin.
Nexo has one of the bitcoin savings account available for you, and they offer you anywhere from 8% to 12% for storing your bitcoin with them.
I hope you found this post useful, thank you for reading
The Way I Save
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There are plenty of reasons why you should diversify your investments, but in this post your going to be reading about the advantages of diversification.
Diversification is the practice of spreading your investments around.
The first advantage of diversification is when you diversify your stocks or money you are able to take advantage of growth opportunities in different sectors of the market.
You don’t have to know which stock to pick you just have to know which industry is going where. Once you figure that out, you can simply purchase a Mutual Fund, ETF, or Index Fund that is already diverse in that particular industry.
The second advantage of diversification is that when you diversify your stocks or money it keeps you stable during tough times. With this pandemic, businesses are going under and investors that aren’t diversified are losing money.
Since I knew businesses are being affected during this pandemic, I invested in gold when the shutdown occurred which saved my investments.
When one sector goes down there is always another sector that is going to be prospering, you just have to diversify.
The third advantage of diversification is knowledge. When one sector or industry is going down that’s your trigger into buying either one good business or one outstanding ETF in that struggling sector.
Now each time you log on your brokerage account, if your diversified enough, you should see where the market is headed. You can see which sector has gain momentum and where to put more money.
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Just remember it starts with you, on that note don’t rely on your parents to leave you something when they pass away, because if your parents are like mine they don’t have anything to pass down to you. So start your creating your own Wealth.
All you have to do is buy. Ask anyone who has more money than you how they got their money, and most likely they will tell you they acquired something of value. That’s it creating generational wealth is not hard your just over thinking it.
Acquiring stuff can be even easier if you operate you bank account differently. All you have to do is three things.
1.) Lower your expenses
2.) Create a budget to save at least $100 a month.
3.) Only touch it to invest it.
If you took an accounting class you should know that assets are better than liabilities, but the problem is people like to classify miscellaneous things as an asset. Which is why it’s hard for many people to get ahead or create generational wealth.
Assets can be a house, stocks, a business, Gold, or simply anything that is giving you income right now.
Sadly people like to look at things that have potential to give them money as assets, but their only lying to themselves.
Look at everything you own and determined what is adding not just value, but income in your life. After determining what your biggest asset is simply create a habit of buying more of it.
DONT FORGET TO WRITE A WILL
There are plenty of places that can create your will, but why not do it yourself. Nowadays your just a click away to creating your “Legal Will,” from places like http://rocketlawyer.com.
I hope that in this new year you make a personal goal to acquire assets to increase the capital you own, and create generational wealth.
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