HOW CREATE PASSIVE INCOME?

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

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.

ROYALTY FEES

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.

What’s an IPO?

IPOs are always being listed on the exchange and you can make a considerable amount of money from buying and selling IPOs at the right time, but what are they specifically. Well in this post I am going to break down this acronym, and tell you whether or not you should invest in an IPO.

I – INITIAL

Well let’s begin with the first letter of IPO, which stands for initial. When a private company is planning to grow rather quickly, they look for funding in various places. Take “Publix” for an example, they offer their own employees an opportunity to buy a share of a company. With that money reinvested in Publix the company is able to acquire more assets to grow in profitability.

P – PUBLIC

The “P” in IPO stands for public. After massive expansion, a company like Publix is able to go public with their stock. This means a non-employee of Publix can become a shareholder in the company now.

O – OFFERING

I stands for Initial, P was for Public, and O is for Offering. As an Initial Public Offering, a private company is able to become a public company. The benefits of this transitions helps the company go from a couple hundred thousand in funding, to millions or even billions in funding.

BUT…

When a company is newly listed the information of its business dealings are very slim to none. Which means many investors do not know much about the company’s Assets, Liability, and the companies performance record (profits).

Even with knowing very little about a newly listed company, investors still gamble and invest in IPO’s. Which result in these investors loosing everything.

So taken it from Benjamin Graham when he states that the more you know the better with stocks; this is my translation of what Ben teaches in his book “The Intelligent Investor.”

Thanks For Reading

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HOW TO PICK A STOCK

If your like me a few years ago, you probably want to invest into the stock market but you don’t even know what to buy. Well, you clicked on the right post, in this post your going to learn how to pick the best stocks and be able to determine what a good stock looks like.

Okay for starters, there are plenty of ways to make money in the stock market, But the best way is by holding on to a stock for five or fifteen years. There are two reasons why this is the best method.

  1. You can build capital
  2. You can receive dividends

CAPITAL

Now to build capital you have to do some research before you pick a stock. You cant just pick a stock based on what you think, or what some else thinks (that is a good way to lose your shirt.)

There is a cool site that helps you gather information about a stock and its called “SEC.GOV.” This website was created by the “U.S Securities and Exchange Commission” to help the individual investor make informed decisions on a stock before investing. Every stock that is listed on the market has to give updated information on the companies balance sheet, income statement, and cashflow statement, plus any executive decision.

I personally use sec.gov every quarter, to get updated information on how my stocks are doing. I suggest you to do the same, because this is a good way to learn more about the company and where its headed financially. You deserve to know if the company is making money or losing money.

DIVIDENDS

Part of deciding whether a stock is good, is by seeing if the stock gives quarterly dividends and has been doing so for more than fives years. This is another piece of information that is provided at sec.gov.

At the bottom of the picture above it shows the dividends per share for this particular stock. It also shows you how much dividends was handed out by the company in 2019 after three months and 2018 after three months.

Dividends gets passed out each fiscal quarter, which is every three months. At the bottom left you can see the dividends given after nine months for 2019 and 2018. I showed you this picture just to give you an idea of what your looking for in a stock, when it comes to dividends.

Just to give you a heads up, the reason why you want to pick a stock that shows more than 5 years of dividend payments, is because the company decides whether or not to give its shareholders dividends.

Thank You for reading

I hope you enjoyed this post if you did let me know by leaving a comment.