Beginner's Guide to Passive Income Archives

Beginner’s Guide to Passive Income (1): The Beginning

January 21, 2025 / 197

I know the title of this article is a bit different from my usual style—neither catchy nor dramatic. However, after writing several hundred weekly posts and receiving countless questions, I’ve noticed a recurring pattern. People often ask: What are the most common types and asset classes for passive income?What are the typical returns like for passive income?How liquid is passive income? What are the usual terms?What are the common risks associated with passive income?What realistic expectations should I have about passive income, and what illusions should I avoid?Is passive income suitable for me? In other words, what type of person... Continue reading

Beginner’s Guide to Passive Income (2): Common Asset Class

January 21, 2025 / 178

In the broadest sense, passive income refers to any income you can earn without actively managing it or investing your time and effort. However, my focus is specifically on passive income from alternative assets.Let’s first clarify what alternative assets are and why I choose to focus solely on passive income within this category (as opposed to the broader definition of passive income).What Are Alternative Assets?Put simply, alternative assets are those outside the realm of mainstream asset classes.What are mainstream asset classes?These include the usual suspects, such as stocks, bonds, and cash etc. Even within these categories, there are passive income... Continue reading

Beginner’s Guide to Passive Income (3): Legal Asset Class Cycles, Returns, and Entry Points

January 21, 2025 / 176

Continuing from the last post, this time we’ll dive into the terms, returns, and entry points of the Legal asset class within passive income. To provide a full picture, let’s first look at the standard practices in the market and then explore how my own approach differs through tailored product design.Market StandardsLegal Lending Type: Part of the credit category, structured as debt instruments.Returns: Typically, 8–12% annually.Cycle: Usually 3–5 years.Entry Threshold: For top-tier names like Goldman Sachs or JPMorgan, entry starts at 7 figures, though $250,000 options are also available. (These are just illustrative examples—you’re welcome to fact-check on your own!)Access:... Continue reading

Beginner’s Guide to Passive Income (4): Private Credit Asset Class Cycles, Returns, and Entry Points

January 21, 2025 / 181

The Private Credit market is enormous and diverse. Essentially, any money lent out as debt can fall into this category. This includes consumer loans, business loans, real estate loans (e.g., first and second mortgages etc.), microloans, and countless other types and structures.Debt investments are much simpler than equity, even though the range of debt types and structures is vast. Returns and cycles don’t vary much across the board, so I’ll summarize broadly.Market StandardsMost private credit investments involve asset pools. These are bundles of hundreds or thousands of individual loans grouped together as underlying assets. Consumer Loans (e.g., personal or credit... Continue reading

Beginner’s Guide to Passive Income (5): Entertainment Financing Cycles, Returns, and Entry Thresholds (Part 1)

January 21, 2025 / 190

Entertainment financing has always been a fascinating topic. The allure of movies, music, and famous personalities often makes this asset class seem like a gold mine, but its non-standard nature and lack of transparency make it hard to navigate. Let’s break it down into categories, starting with the simpler ones: music and audio dramas.Music and Audio Drama LicensingMusic LicensingThis typically involves purchasing copyrights. As long as the music generates streams or royalties, you get a share of the profits—usually on a monthly basis. Entry Points: Relatively low, typically around $10,000.Returns: Popular Songs: 15–20% annualized returns.Profitable Songs: Around 10%.The Rest: Some... Continue reading

Category: Beginner’s Guide to Passive Income

Beginner’s Guide to Passive Income (1): The Beginning

Beginner’s Guide to Passive Income (2): Common Asset Class

Beginner’s Guide to Passive Income (3): Legal Asset Class Cycles, Returns, and Entry Points

Beginner’s Guide to Passive Income (4): Private Credit Asset Class Cycles, Returns, and Entry Points

Beginner’s Guide to Passive Income (5): Entertainment Financing Cycles, Returns, and Entry Thresholds (Part 1)

All Categories

Disclaimer

Enter your email to subscribe to our weekly Passive Income Newsletter, and get new passive income strategies every week!