This is the pipe dream, isn’t it?
$50,000 a year without working.
There must be some sneaky thing behind this, but there really isn’t. There is a caveat to all of this though. You need to do some or a lot or work to get to this point. You can’t just read this post and start making your $50,000 tomorrow.
If that was the case then everyone would be chilling at the bar together not worrying about a thing because their auto jobs would be bringing in the paychecks.
Auto-jobs. Heh. I just made that up. I’m keeping it.
Anyways, before we jump into what you can do to start making $50,000 a year without working let’s dive into the logic behind it all.
How to Make Money in Business
The concept of making money with any business is quite simple. You provide something of value to someone and they give you money for it.
Like I said the concept itself is quite simple, but it’s the execution that most people have problems with.
If you can find something of value that people are willing to pay for and then set that on auto-pilot then you are good to go.
There are of course other ways to make money that doesn’t have anything to do with providing value. Investing in stocks is one of them, but to get money to invest in stocks you have to exchange value for money doing something else.
Now that we got that out of the way let’s look at the ways you can make $50,000 a year without working.
1. Accrue a Buttload of Dividend Stocks with a 4% Yield
I know, I lured you in with all of this talk about providing value and then I tell you that you need to acquire a lot of stocks to make the $50,000 happen.
I bring this one up first because it helps you get into the mindset of having your money work for you.
To earn $50,000 a year from dividend stocks then you need to acquire $1,250,000 worth of these stocks. As long as they pay out dividends at a 4% yield then you are good to go.
What makes this method of earning money so great is that you don’t have to worry about touching the actual stock so compound interest can work in your favor.
What does all of that mean?
Well, let’s say you bought $1,000 worth of stock today and ever year for the next 30 years it averages 4% growth. Not stellar, but not bad. Every year that 4% is working with a larger value and therefore grows even faster.
If you sat on your $1,000 worth of stocks and didn’t touch them for 30 years you will find $3,243.40 in the bank. That might not seem like a lot because it isn’t, but you only invested $1,000 into things and didn’t touch them. You shouldn’t expect to get much out of it.
What happens if we put $10,000 in? In 30 years we get $32,433.98 back. And this is being very conservative with 4% dividends. This isn’t taking into account the stock price increasing (or decreasing).
The fact of the matter is that many people don’t take advantage of compound interest or see how it can benefit them. Once you get it working for you, you’ll find that retirement seems a lot more likely.
2. Own Rental Properties
People are renting places like crazy today. Why?
Because they move around a lot. Nobody knows if they want to stay in a certain place for the next 30 years while they pay off a house. Renting is a viable option, but the only way to rent is if places are available.
If you own 10 rental properties and can keep them occupied throughout the year then you just need to average $420 per month for each unit. That nets you a cool $50,000.
But that requires work since you have to find people to rent the places and then there is maintenance. See, I knew you had a big brain in that head of yours. You’re absolutely correct, owning rental properties does take work and that is why many people hire property owners to manage these things.
Now for just 10 rental properties that only net you $50,000 in profit a year it might not be worth your time hiring a property manager to get a piece of the pie. Maybe you could work out a deal where they get to live rent free in the 11th property.
Start Learning Real Estate Now
If this sounds interesting to you then don’t hesitate and start learning about real estate now. That doesn’t mean that you start binge-watching all of Property Brothers. It means understanding your market, the costs of keeping things humming, and how to properly vet your tenants.
Crowdfunding Your Investments
If you aren’t quite sure about going at this alone, then there are sites popping up that allow to join others and invest in real estate together. That way if things go south, which is always a possibility, you aren’t footing the bill on your own.
RealtyShares is one such site that offers you the chance to invest in a portfolio of real estate properties with others.
3. Start a Business and Outsource It
If you’ve read The 4-Hour Work Week this is the basic principal that Tim Ferris teaches. You can setup a business that makes money and all you have to do is ensure that revenue exceeds expenses.
To take it offline think about people that own Subways. They usually own more than one because they can hire people to run them without having to be there all of the time.
Let’s say this website is making $20,000 a month, but because I run a lot of other sites as well I don’t want to manage this one so I look to bring on an editor. How many people would enjoy working on a blog for $5,000 a month?
I know a ton of people would.
That still leaves me with $15,000 a month and I no longer have to do any work on the site besides making sure it isn’t going down the toilet.
Your Initial Investment: Time or Money
Some of you might have come here looking for the easy peasy way of making $50,000 a year without doing anything.
There is no easy way. Everything requires some type of investment. You can choose to invest time, money, or both, but one of those things will need to be put in to make this all work.
The problem many people have is that they are lazy and want to find even lazier ways to make money. While you could always make money with survey sites you won’t be making $50,000 a year through that and it won’t be very passive.
It is a nice lazy way to make money though.
However, if you want to make a full-time salary while relaxing as much as possible then you need to put in the work upfront.
Think about the different blogs that I run. Launching a blog is extremely easy. You can sign up for a hosting account, click an icon, and have a WordPress site up and running in minutes. But I put in a lot of time before that even happens doing research and other things.
I try my best to lay down a strong foundation so when those times that I don’t feel like working things are still running smoothly.