How important is passive income?

Passive income is as important as drinking 8 glasses of water everyday. Some people see it as a necessity, while others think otherwise.

Case 1
James, 34, is a pilot garnering a income of $7,000 a month. He is able to afford an expensive car, a luxury house with big gardens and anything else that he likes. His monthly expenses, which includes the installments, credit cards, utilities, etc, turns out to be $5500. That leaves $1500 to save every month.

Not a bad lifestyle.

James was retrenched a year later, due to the global economic crisis. Other airline companies are offering him only $4500.
So what happened to his expenses? They remain. James was unable to accept his new lifestyle.
James wanted to ask for a higher pay, but there are many other pilots who are willing to work for less clinched the job.

Now James is jobless.
Income: $0
Expenses: $5500


Case 2
Connie is a school teacher. She has an income of $2500 and a monthly expense of $1000. Connie saved up $1500 every month and invest it into any business opportunities.

Every year, her passive income increases.

At the 2nd year of investing, her passive income was $900. However, she saved up that $900 every month and re-invest in for more passive income.

Finally after 5 years, her passive income became $3200. Right now, Connie have many choices.
1) Re-invest for bigger passive income
2) Quit her job, maintain her current lifestyle
3) Continue what she is doing right now, getting BOTH passive income and work salary


Importance of passive income
Passive income gives us the TIME and FREEDOM to do the things we like. Ask ourselves, do we enjoy our work right now? If yes, for how long can we work? If no, then why are we doing the same routine everyday?

Do you want to receive passive income after retirement or zero income after?

http://www.aboutpassiveincome.com/