This topic has been discussed and debated by many in the financial community and is regarded as controversial by some. Numerous bestsellers have been written on the subject.
Traditionally, when it comes to making money, most people share the same mentality - "If I work harder in my job, put in more overtime hours, I'll get ahead and make more money." Unfortunately, no matter how many hours they put in, they'll forever be constrained by the laws of nature. There is only a finite number of hours you can work in a day during which you can exchange your available working hours for monetary compensation - essentially, trading hours for dollars, or trading time for money.
The New Approach
The new approach is hard for many to accept as it requires a different understanding beyond what we were taught as children. The new approach places lesser priority on active income and a greater emphasis on passive income generation. Active income would be money earned while putting in your hours sitting at your office desk (trading hours for dollars). But passive income would be money generated from sources such as stock investments, real estate appreciation, rental income, and even advertisement revenue earned by websites that you own. The limitations of the old approach to money are obvious.
You Are Constrained By Time
By trading hours for dollars, you are foregoing time that could be spent tending to other things in your life such as friends and family. You are choosing to spend your time in an office, rather thanRead the full article »