I just want to start earning passive income, I don't have enough for real estate. I published a couple ebooks but they aren't really making anything and I'm losing confidence.
I've invested £5k into dividend stocks (LSE) which I'll carry on doing.
I just don't want to work this shitty job anymore, I come home feeling exhausted. I just want to work for myself but I don't know how.
I don't think you should be focusing on passive income vehicles. It takes a lot of money just to get a trickle of income and even that is taxed.
Instead, focus on capital growth first.
I have about £1k per month to spend, is it not a viable strategy to spend that monthly on income generating assets? I just to know where to throw my money
Well, it's possible, but I don't think it's the best. Obviously, since you have 1k a month, you don't need the extra money that passive income will bring, so just put it in an index and watch it grow. Unless you sell, your taxable income from this will be very low, only what your small dividend will be, which you will reinvest with DRIP. In the meantime, figure out what you want your life to look like - where you want to live, what your expenses will be, what kind of lifestyle and income you want.
Once you have enough money to cover your goal, start transferring your gains into passive income vehicles.
You can also combine this with a real estate strategy for some diversification, but that's another topic.
What I've been doing since January is dividing the 1k between 10 safe dividend stocks per month. Would it be a much better idea to just put it all in an index?
It really is up to you. Honestly, I don't think you'll make a huge mistake either way. But, just be aware of what you're paying in taxes on your dividends vs. what you'd be getting in nontaxable gains in the index fund. Always trust the math.
Personally, I just cringe when people go nuts for dividends, the cash-on-cash returns are incredibly low from what I've seen.
In the UK you only get taxed on your dividends when they amount to more than 5k, which I am a long way off
Wait. So if i put 50k into a UK account I can be untaxed on that income?
You aren't taxed on your first 11k of income
any more than that up to 43k is 20%
23 - 150k is 40%
over 150k is 45%
with dividend income, you get 5k dividend income.
any more than that and you're taxed at 7.5% if your TOTAL income is less than 43k
if you're total income is between 43k and 150k your dividends over 5k are taxed 32.%
if your total income is over 150k, your dividend income over 5k is taxed at 38%
the 40% income tax band is 43 - 150k***
Hmm. Too bad UK is going to turn to shit
Move up North, houses are dirt cheap up there.
Even on a 30k job you should be able to own outright within 5 years.
>I just want to start earning passive income
don't we all?
the thing is it's a myth. a product some fuckers sell but no such thing as passive really. you either take huge risk or you have to manage your investment worst case have operative cost on them time and money.
Not really a myth. There are lots of investments that are pretty passive with no management on your part, except to file taxes for it once a year.
investments where you actually put a lot of money into it which equals to a lot of time spent on your part to earn that fucking money.
it's not passive in my book. part of your earnings will go get eaten by inflation and taxes some of that will increase your wealth or you will live it up butt it requires huge investment.
i think you can reasonably expect to live from an investment of $500k. at some places less. but you have to manage that for this to work if you don't manage your wealth it's going to seep away.
that is what i meant by passive income is a myth. these fuckers that write books about it and make youtube videos present it as an easy thing to do but the fact is they have to continuously shill their info product to make a living and expanding it and organizing it and whatnot and set up a new one as one dries up. it's not passive. they are basically slaving.
Sell OTM puts in liquid index ETFs.
how much did your Ebook made ? and whats it was about ?
Sorry, using that definition is incorrect and is just being dumb. Passive income means only your capital is generating income rather than your time.
but your capital is your time
also no investment is without risk
like i said you either take risk and invest a huge sum (which is not passive income as the faggots use the definition) or you constantly putting effort into an ever drying up revenue of an info product.
my fucking investments are not passive income. i worked fucking hard for the money i saved it up and if i lose it i will lose that fucking time.
faggots talking about passive income usually talk about making a youtube vid in an afternoon and cashing it out forever.
what i'm trying to explain here is that i have learned to do what i do from about 12 years old of age literally a decade of learning and preparing then near a decade of working got me my savings that i can invest.
it's my time that i did not spent. i denied things from myself to collect it.
and then most investments that are relatively risk free barely break even with inflation after taxes, and anything that performs better has considerable risks of losing my savings.
if you call that passive then so be it, but it does not fit the definition.
and also to speak of any meaningful income you need to work half a lifetime at most jobs and you need to prepare for those jobs a quarter of your life. so passive.
some people get lucky i will give you that but there is no recipe it's all a big fucking stinking scam.
link your ebooks
if you say you don't want competition, you're a roleplayer and I'll lose faith in this site