Have You Ever thought Of Loss of Income and the Need for Passive Income?

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I have been fighting with a strange case of influenza in the last couple of weeks, no it’s not Covid as we had dutifully tested for it a couple of days I acquired the flu and did pass it with flying colors and an online certificate to fit but three weeks after infliction I still find myself weak.

Last night, we went for an acupuncture session with a doctor of Chinese medicine friend of ours. I’ve been trying to book a face-to-face consultation with our family doctor but then medical consultations on our end of the world have shifted to phone-only consultation because of the second-round of Covid lockdowns in our province. 

Covid19 has shaken the financial standing of many businesses both large and small the world over. Our own practice and business have since slowed down as a result but the last three weeks of not being able to work as much as I would like brought me to the realization of the fact that none of us are made of steel and that no one has the privilege of being able to be productive amidst an illness or disability.

Loss of income due to illness or disability is a real risk that could affect anyone and not being able to work as effectively as I want in the last couple of weeks made me realize that even if you’re an entrepreneur with an already successful business, you may still be at risk of losing it all if you’re unable to work.

One thing one can protect oneself against lost or reduced income in case of illness or injury is the implementation of living benefits plans such as critical illness and disability insurances. These plans protect you in the worst case that you get sick or injured. 

But one of the most important realizations I came face to face with during my battle with prolonged cod like symptoms the derails my energy is the need for passive income. 

Having a business or self-employment isn’t enough if one is reliant on active income because if one is unable to work then income stops. It’s good to plan ahead by having critical illness insurance and disability insurance in place but then, of course, it only covers you when you either become seriously ill or when you have a disability.

If you can’t work due to other reasons like pandemic lockdowns that we all currently face, no insurance policy that I’m aware of covers such situations. 

One thing we should all have learned from this pandemic is that we can’t rely on active income jobs or businesses to get us by if we’re unable to work or if we can’t go out to perform our functions to make a living. Either way, you lose your income source.

I have been neglecting the need to build a passive income business even though I have been fascinated with the prospect for so many years. The challenge, I believe is in keeping your motivation to work on something that doesn’t pan out yet, as a result, we tend to focus on activities that bring income right away so as not to feel as if we’re wasting our time.

Passive Income Takes Time to Build

The very reason why most people fail to build passive income is the fact that it does take time to build. Blogging, for example, requires that you write articles upon articles when no-one actually reads your blog.

I just realized that it takes tremendous energy, consistency, and endurance to build a passive income project, which in fact is the very reason why I’m failing on it. Building a business is easy, building a passive income business is another story!

Last Monday, local businesses were all ordered to shut down as part of the government’s effort to control the spread of Coronavirus in our city. This is the second round of business closure where we’re at. If you’re a local business owner, I know that you feel the heat and this could be the reason why you somehow landed on this article. 

Passive income is a need, not a privilege. 

Ways to Build Passive Income

There are different ways one can build passive income, and they are as follows:

  1. Blogging / Niche Website 
  2. Investing
  3. YouTube Channel / Show
  4. Physical Product Business / Brand
  5. Affiliate Marketing

Blogging / Niche Website

My first taste of success in being able to earn passive income was way back when I built a niche website that drove in 1,000 unique visitors per day. At that time, the website was driving around 30,000 unique visitors a month and was earning an average of $400 a month. While not a lot, that was a nice source of a small extra income while I was working full time a job.

Nowadays, I have two local lead generation websites that I rent out at $300 each. Less merchant processing fees, I’m netting around $580.00 a month on these two websites, which I never fail to compare to real estate rentals, less the real-world maintenance. So it’s kind of like having virtual commercial real estate that I rent to out a local business owner. 

A friend of mine actually suggested I build more of these websites but for some reason, I’m not so convinced that this is the way to go in building a passive income business as you’re always at the mercy of the sites being able to drive leads to your local business client. 

In this case, my local business client is a contractor who provide real-world renovation services to local customers.

What I want to build more of is a blog that serves the international audience, such as this one as the idea of being able to make money even when you’re sleeping is just so attractive but then it does take more effort than when you’re building a website for a local audience.

Building a blog or a niche website for a global audience, takes more time, energy, and effort than a local lead website and I must admit, I don’t actually know what topics to write about most of the time.


Investing is a traditional way of building wealth. A lot of entrepreneurs consider investing as a slow way of building wealth but I believe, investing, just like anything worthwhile is worth it. You just have to be consistent with investing a portion of your income on a monthly basis. If you’re an entrepreneur, this is where we all get confused. It tends to be pretty straightforward if you’re simply working at a job or a profession but as an entrepreneur, choosing between reinvesting your money into your business or in the market is a tough feat.

The solution is to decide on a percentage. The more portion of your income you invest, the faster you’ll achieve your investing goal. So it really depends on which vehicle you want to use to achieve your passive income goal. Either you build a business or you grow your assets through investment.

If you choose the investing route. You’ll be able to support yourself successfully and consistently with a passive income from your investments if you’re able to live on 4% of your asset. Say, you managed to build a $1,000,000.00 worth of market portfolio, you will be able to support yourself with $40,000.00 income from your investment and not risk over-drawing your funds.

YouTube Channel / Show

A lot of people have found success in YouTube by creating entertaining or informative videos. If you find speaking in front of the camera easier than writing behind a computer screen, then this is a must-try. 

YouTube is similar to blogging, it takes time to build and one video won’t get you there!

Much like blogging, a YouTube business is a publishing business where you publish content that may be useful to others. It takes time to build but then has the potential of providing you with passive income in the future.

If you’re on lockdown right now and wondering what to do with your time, I would suggest that you start working on a passive income business such as a blog or a YouTube channnel.

The drawback of purely doing YouTube as a business is, of course, the fact that you don’t own the platform and that monetization can be limiting as your main monetization may revolve around Adsense ads and affiliate marketing.

Physical Product Business / Brand

If you’ve been lately observing how the market shifted to eCommerce you’ll know that there’s a lot of opportunity in the online physical product realm. The easiest way of starting a physical products business is by reselling products from already established brands on Amazon.

I have tried a bunch of physical products businesses since 2018 and I’ve been finding some success with wholesaling and flipping products of already established brands lately but then this business model isn’t something that can provide me with passive income in the near future as this appears to be a constant hustle. While I find that this is a good way to raise capital, I don’t think that this is going to be a long term business as I find that this is something that can burn you out quite easily as you have to constantly search for fast-moving inventories, at least in the case of online and retail arbitrage, wholesaling has a better potential but opening wholesale account can be challenging.

The long term strategy…

The long term strategy when it comes to physical products is in branding your own line of products in a certain niche that will allow you to grow beyond Amazon.

The largest online marketplace for the physical product is Amazon and I find that with the right products, you can build an online business with a fast ROI by reselling stuff online. However, since you don’t own the platform, you can get kicked out anytime for a lot of crazy reasons. To build a truly long term physical products business, you have to build your own brand and have your own sales and distribution platform. This way, you’re not entirely dependent on someone else’s platform.

Affiliate Marketing

Passive income in affiliate marketing requires that you have a platform, while there isn’t a shortage of people who makes money with paid traffic affiliate marketing, a truly passive income affiliate marketing business requires at least a website or a blog, which in essence is your business platform. A lot of people have found success with YouTube affiliate marketing as well but if you’re utilizing YouTube or any other social media platform to build your affiliate marketing business, it’s still a good idea to channel them toward your own platform. If you own it, you pretty much control it, and no one can kick you out of your own platform.

The fastest way to make money from affiliate marketing is media-buying or paid traffic but just like trading, you can easily lose your shirt with paid traffic affiliate marketing, and while you can make a lot of money with paid traffic affiliate marketing, it’s rarely passive.

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