With every concept, there are some myths associated and so is with the concept of ‘how to earn passive income in india’.
It is important to bust such myths in order to make decisions without any bias. Myths or any kind of biased information in the field of finance can actually cost you a lot. It is important to do your own research on anything you hear about personal finances at least because that information might create a bias and later guide your financial decision. Passive Income is one of the most misinformed topics in the finance world starting from ‘what is passive income in india‘ to ‘how to earn passive income in india‘. People believe in whatever they hear from people around them because they claim that the particular thing worked for them.
No matter how good one is doing in terms of earning money in their life from their current profession, business or job, extra income is always welcome and nobody turns down any easy income source. In fact, people with decent corpus have higher chances of making more money if they know what exactly to do with it and if they do not know and are ready to take professional guidance for it. So, there is a need to bust the existing myths about passive income and empower one another to make smart financial decisions.
- ‘Set and Forget’ system doesn’t work
The ‘Set and Forget’ system is basically developing a system and then never having to bother thinking about it. Many people claim that even after setting a system for passive income, one has to give a significant amount of time to make sure that the system is working properly, which is not true. It totally depends on the kind of source one has chosen for earning Passive Income. If it’s the wealth based passive income that we are talking about, then it’s pretty much ‘Set and Forget’ as you create a system where you have invested in different assets according to your goals and risk taking ability and after that the system is working in itself to bring you positive cash flow. Sure, one has to be careful about extreme market conditions such as a crisis but otherwise it is pretty much ‘set and forget’.
- Real Estate is the safest form of Investment
This is one of the most common myths that we have, especially in the Indian Context. We find the rental income to be the most common form of passive income in India and also considered one of the easiest one as people assume there is nothing much to learn about it and just the ownership of a place or a venue is all you need to earn a decent amount regularly. Unfortunately, this is also not true. People make several mistakes like ignoring the costs of property repairs and updates, pain of dealing with bad tenants and other unexpected expenses. What they also do not pay much attention to is the choice of real estate that they should own, be it residential, commercial, industrial or warehousing (each having its own pros and cons).
- One needs a business idea to earn Passive Income
This is again a totally wrong notion. One need not have a business idea to earn Passive Income. In fact, it is totally against the very idea of ‘Passive’ income because executing or setting up a business will become something that one will be giving his/her time to and also putting efforts. In such a case it becomes the active income and does not count as passive income. You can simply invest your existing wealth (which usually is left idle with zero or mostly negative growth rate) and earn passive income and not even have to put much time or effort into it.
These are few of the myths that people have about passive income which might work as a resistance or a hurdle in order to make a good financial decision. There will be many coming your way in the future. The key is to do your own research, ask experts in the field and if feasible, hire professionals for the job.
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