5 Passive Income MISTAKES Beginners Make! 2019

– Hey, what’s up everybody,
welcome back to my channel. My name’s Odi, I go by ODI Productions. If you’re new here, I’m an entrepreneur, I’m a music producer, I’m a YouTuber, and I’ve been obsessed with passive income over the last seven years. And passive income is
what truly allowed me to go from being UCLA
dropout, my senior year, to living my dream life, getting to experience
so many great things, being able to, you know,
create this platform online where I get to inspire people, and I get to help people on their path towards financial freedom,
which is really the goal that most people should set, and I think passive income is the best way to achieve that goal, so you can have freedom,
not just financially, but time freedom, and
location freedom as well. So the topic of today’s video is actually the top five
passive income mistakes that I see beginners
making every single day. And I see it in my YouTube comments, I see it on Instagram,
and my DMs and comments. And I just see it online and I see that the average beginner
and the average person who, you know, wants to start a
path towards financial freedom, or you know, just more
abundance in their life, they are approaching things the wrong way. And I’m gonna share these five
mistakes with you right now. So let’s jump right into it. Alright, so the first mistake
that I see beginners make every single day, when it
comes to passive income, is just having the wrong understanding of what passive income really means, and also just having the wrong
perception going into this. So when we think about
the words passive income (light music) we basically think that, you know, you’re making money for doing nothing. And the truth is, this actually exists. However, there’s no such
thing as passive income with an investment of time or
money up front, beforehand. Okay, so it’s important to realize that if you want to make passive income, you have to give something
first, in return. So you know, you have to
spend either your time to build up passive income sources, such as businesses, or you
have to spend your money to invest into these investment accounts, you know, if we’re talking about funds, if we’re talking about stocks, if we’re talking about real estate. You know, you have to invest
the money or the time up front in order to make your income passive. Now, what’s the opposite
of passive income? This should be active income, and the least passive income
is trading your time for money, through a job, and I know because I used to work the nine to
five, a full time salaried job, and that’s the actual
antithesis of passive income, is when you’re literally trading one hour for some sort of wage,
you know whether it’s $10, $15, $20, $50, even $100 and more. The problem is when
you’re actively trading your time for money, this
isn’t passive income. And you know, you need to figure out ways to translate that money into
more passive income sources, and diversify into passive income sources, if you want to achieve true freedom. Because when it comes to
achieving financial freedom, you’re gonna have to figure out ways to generate passive income,
because the truth is, trading time for money is always
going to be a losing game. Because, you know, no
matter how much money you’re actually making, you
can be making a hundred grand, 200 grand, 300 grand, 500 grand a year, but if you’re working 60,
70, 80 hours per week, you won’t actually have any time freedom. So this is something that
people don’t really think about, they don’t really think about their time, they always think about money, and they always think about salary, and they always think about
trading time for money, but the truth is, you want
to aim to get freedom, not just financially, but time freedom, and location freedom so you
can actually live the life that you wanna live,
which is being able to do what you want, when you
want, whenever you want, and not having to have anyone, you know, approve of paid off or anything like that. So, that’s kinda like
my big thing is freedom, and just having total freedom, not just financially, because obviously that’s an
important piece of the puzzle, but also having time freedom,
and location freedom. So, there are varying degrees
of passive income, okay. So, when it comes to
something like investing into some, let’s say like a
conservative stock account, you know maybe it’s like index funds, and mutual funds, and something, you know like a vanguard fund account, where it’s pretty reliable
and it’s pretty, you know, you’re gonna get some returns annually, like two to 3% for a conservative account, you know, this is passive income in the sense that you put
in $1,000, $10,000, $20,000, then you’re gonna see a return without really doing much of anything. So that’s real passive income,
if you’re not doing anything, and all you have to do is
put this money up front, then you can make money. Now, on the flip side, a
lot of people don’t have like 10 grand to just put up. So with that being said, there are so many opportunities today where you can build a
passive income source, with very low risk, low
overhead business opportunities that are available today, and I’ll get into that in a little bit. But the first thing I
wanna explain is just passive income, and people just
having the wrong perception that passive income means you know, you don’t have to do anything
and it just magically appears. You have to invest
either your time or money to make passive income a reality. But it is a very, very real thing. I’ve experienced it myself, and I’ll get into that
later in this video. Now, when we think about the
different business models, because I know that a lot
of people who follow me are interested in entrepreneurship and the online business world. Now the different business
models have varying degrees of passive income, and pacivity. So what I mean by this
is if you were to run an e-commerce store for example, it’s more passive than a traditional job, but it’s not as passive
as let’s say, you know, having an affiliate marketing website, that you literally don’t have
to do any customer service, you don’t have to handle
any products or inventory, you don’t have to handle any
shipping or distribution, but when you have an e-commerce business, the thing is you can get paid
any time around the clock, even when you’re not
actively working on it. You can get orders at 12:00 a.m., you can get orders in the middle
of the night, at 3:00 a.m., you can get orders when
you wake up at 9:00 a.m. in the morning, and then
you can ship them out when it’s, you know,
it’s convenient for you. And then that’s technically passive, in the sense that you’re
not actively working, 24 seven, your website’s working, your business is working instead. But the problem is when you
deal with physical products, and you do e-commerce, you do have to think about, you know, distributing your
products to the customer, and making sure that there is, you know, this sort of fulfillment. And that’s something that
Amazon is really big on. And you know, most people who
do run e-commerce businesses will tell you that it’s not something that you can just set it and forget it, and then just not check
it, and not handle, you know, customer orders,
or manage your team, because with e-commerce you
need to hire people eventually such as virtual assistants,
also known as VAs, and employees to run and
manage your business. Now, there are business models
like affiliate marketing where you can literally be a one man team with no employees, no VAs, and I have been able to do that myself, where I had zero employees, and I was able to build that up, you know, to a full time income, and more, and all of that being truly passive in the sense that once
you put the work up front, and you spend the time, then you can get sales for
months and years to come after the fact, so
yeah, that’s number one. People having the wrong
idea that you don’t need to invest anything in order
to make passive income. Alright, so the second most common mistake that I see with beginners
in passive income is lacking patience. Alright, so this is an important one, but it’s a very simple one, right. So, when we think about success, and we think about our society, the problem is our society is geared towards instant gratification. These days, there’s apps for everything, where you literally press a button, and someone will deliver
something right to your doorstep. Now the problem is, there is no app, and there’s no person out there where you can press a button
and they can deliver success, and passive income results
right to your doorstep. It just doesn’t exist, and that’s what people are
looking for on the internet, is some sort of magic button, or an app for this, when there’s
no such things as an app, and it comes down to good old
fashioned habits and mindset, and one of those is having a high tolerance for
delayed gratification. Because our society and 99%,
you know, the average person, is so focused on instant gratification, just having something
delivered to them, right, and served to them on a silver platter, but the truth is the real rewards in life come from having a high tolerance
for delayed gratification, where you’re willing to put in the work, you’re willing to sacrifice, and you’re willing to be patient, even when you’re not seeing
those results happen quickly, and immediately, you know that over time, things are going to compound and if you know about compound interest, and you know about how doing little things every single day will actually
create big, big results in the future, this is also known as a
slight edge principle. You guys should really read
the book The Slight Edge, I think that’s a book that
can really help people to embrace the idea of
delayed gratification, of sacrifice, of you know, basically putting in
the hard work up front, not getting paid for it,
not getting rewarded for it, and then in the future, being
blessed with passive income, with financial freedom, time
freedom, location freedom, but these are the best things in life, so they’re not gonna come easy. Now everyone’s looking for easy. Everyone’s looking for fast,
everyone’s looking for quick, everyone’s looking for shortcuts, but the truth is that
people who are willing to endure the most pain are
the ones who are going to see the most results. So when it comes to
patience, make sure that, you know, you aren’t
someone who is addicted to instant gratification, and
you should train yourself, and develop that habit
of raising your tolerance for delayed gratification, so that means putting in
work without getting paid. Now this is the absolute opposite over the traditional person
who works a normal job, whether it’s a nine to five, whether it’s an hourly wage job, you’re so used to trading
your time for money, you don’t have any tolerance, you know, for putting in time and
not getting paid for it. But if you’re willing to put in, you know, 20 hours, 40 hours, of work and not get paid a single penny for it, because you know that in the future, basically there’s going to be a flip, there’s gonna be a switch where you’re putting in your time for money right now, and you’re not getting paid too much, but eventually you’re gonna
be getting paid way more for the time that you put in. You know everything’s
gonna basically flip, it’s gonna be an inverse, but you have to be willing
to invest the time, or the money up front if you want to see this inverse happen. It’s just so opposite
of the normal person, and what the average person thinks. And the truth is, you don’t want to think like the average person, right? Because if you want to think
like the average person, you’re gonna have average results. You’re not going to be
wealthy or financially free, you’re not gonna have the time freedom, the location freedom, to
live the life you want, ’cause let’s be honest, most people, 99% of people in our society
are not living the life that they want, and it’s simply because they’re not putting in the time, they’re not putting in the money, and they’re just not putting in the effort to achieve these huge
goals and dreams, right. So be the different person
who is willing to be in that 1% and not do what
the average person does, not think like the average person thinks, and that will get you
closer to your goals. Alright, so the third most common mistake that I see when it comes to passive income is actually a myth that people believe that they need a lot of money or resources to start earning passive income. And this kinda ties in with
the next point I’m gonna make, but I just want to tell you guys that this is a complete myth. If people think that, you know, you need hundreds of thousands, or
millions of dollars, right, to invest, whether it’s
stocks and real estate, or on the flip side,
if it comes to creating a business that, you know, you need thousands and
thousands of dollars, and you need all this
capital up front to start, and then the truth is, you know, you’re not being as resourceful
as you really can be, because even if you don’t
have a lot of money, right, and even if you don’t have,
you know, a lot of capital, or resources right now, the truth is that shouldn’t stop you from creating passive income streams, or investing today, because the truth is, really what we’re trying to create here is the right habits, right. It’s habits and mindset that
are going to create success in the future, and it’s going to make this whole passive income
venture be fruitful for us into the future. This ties in with the second
point of having patience, and having a high tolerance
for delayed gratification, because the problem is if
you have the wrong mindset where you think that you need
tens of thousands of dollars to start, you’re never
gonna start it, right? So what I want to share with you guys is a little story of how I got started with making passive
income and it didn’t start with thousands of dollars. In fact, it didn’t even start
with a thousand dollars. It actually just started
with a hundred dollars. So my first business, which was a website, called recordingnow.com, and if you guys wanna
learn more about this, and you know, the actual case study, then you guys can go in the description, I have a free two hour
passive income master class you guys can check out. But just to sum things up, I started that website with
less than a hundred dollars, okay, and if anyone is, you know, you’re not familiar with how much it costs to start a website, it literally cost less
than a hundred dollars, like three or four bucks a month. And so that’s not really a lot of money. ‘Cause when we consider our expenses on a daily and weekly basis, I mean, a lot of us are spending
that kind of money, you know, $4 a month, we’re
spending that on fast food, we’re spending that on Starbucks, we’re spending that on you
know, things we don’t need. Maybe like expensive clothes, maybe it’s car stuff,
and trust me you know, as a car enthusiast, I
have spent more money than I care to admit on modifying my cars when I know that these
things don’t really have any sort of return, other
than, you know, my happiness. But I see people wasting
money all the time, and people say they don’t have money, but the truth is, it’s not
that they don’t have money, it’s just that they waste
all the money and resources that they are given, or
that they earn, right? And so a lot of this comes down to developing the mindset
of investing, right? Whether it’s your time, or your money to generate passive income. So with my first website,
I invested a lot of time, not that much money,
because you know, $4 a month is no really that much,
at the end of the day. But I invested a lot of time. And I invested the time to,
you know, create content and to get sales through
my affiliate links, right, and I invested time to even
create freelancing services on my website, ’cause I used
to do mixing and mastering. I don’t do that anymore, because you know, it’s actually trading my time for money, but in order to get to that point where you know, you have
resources and you know, you can further invest and
reinvest into your businesses, or into your investment accounts, you’re gonna have to
invest your time up front, if you want to have more abundance, if you wanna have more resources that you wanna be able to reinvest. So I would actually have the passive income side of the business, but I would also do
freelancing on the side just to make some money. And most of us today,
you know, you don’t need tens and thousands of dollars to start. For example, if you were to
start an investment account, you could literally start
with as little as like $1,000, $500, you know, I mean
you could probably start with $100 if you were
really trying to just, you know, get started, but the truth is, it’s more of the habit and the mindset that you develop, of
investing into yourself. So what this means is
even if you’re working a nine to five job right now, and you don’t have any
sort of business income and you don’t have an investment account, the thing is you can still
invest 10%, 20% of your paycheck every single week, or every single month. You can still invest a percentage
of what you’re earning, to start developing, you know,
that mindset of investing. Because once you develop that, you can start putting that money
into an investment account, and again, even with conservative
returns of two to 3%, like year to date returns, you know, we’re still growing our money, and seeing that money grow is one of the most exciting
things in the world, because you’re actually seeing
passive income come to life, where you know, you put
money into this account, and then it makes money. The truth is, you need
a little bit of money, and you need a little bit of investment, again, whether it’s time or
your money, to see returns. Now if you don’t have any money, you need to invest your time. You need to invest time into studying the different business models, because it’s never be
easier to start a business, than today, in 2019, and beyond, where we have the internet, you know. We all have these powerful
tools, like an iPhone, right. These are things that really
were not at this level you know, five, 10 years ago. I mean we didn’t have anything
close to having the power, the computing power, and
the processing power, and the internet and the
speed of the internet, as we do right now in
the palm of our hands. Now the truth is, we waste this power on watching Netflix, and YouTube, and I know you guys are
on YouTube right now, but at least you are investing your time into educating yourself. But the truth is, the average person, they’re just watching entertainment. They’re just watching
things that, you know, they lack substance, and they’re not actually
gaining anything from it, they’re not actually
learning anything from it. So, I would say, you know,
the third most common mistake really is not using
the tools that you have that are within reach, because
if you have the internet, and you have a laptop or
even just a smartphone, and you’re not using that
to the fullest advantage, then you have no one to
blame but yourself, right? ‘Cause if you, even if you don’t have thousands of dollars to
start an investment account, and really see some,
you know, nice returns, the truth is, you can
still do your research, still do your homework, and still prepare, so that when you do get that money, let’s say you work at your job, and you continue working
there for the next two, three, five, 10 years, if you start to get into the habit of basically squirreling
some money away, right, you set aside 10, 15, 20%
of every single paycheck, and you put it towards an
account that you don’t touch, and you just allow that account to grow, then that’s where you
actually start to see your effects and your
investments compound over time. Okay, so it’s very important
to break the limiting belief that you know, just ’cause
you don’t have $10,000 today, or because you know, let’s
say that you work a job, and it’s hard, and you don’t have the time to you know, be creating
a business right now, you know, you need to let
go of these limiting beliefs because ultimately,
your life is up to you, and what you decide to do. So, if you decide to change things up, and start to budget, start
to see every single dollar that comes in and out of your account, and you start to again, separate
a portion of your income, and at the beginning of things, you might have to get a job. That’s just the reality. Some people, they just wanna get rich without ever having to work, without ever having to get a real job. I recommend people get a job. You know, and I’m probably
one of those, you know, a person who is anti-school. You know, I dropped out of UCLA, and I’m anti-job, because
you know, I used to work the nine to five, and I hated it. And the only way for me was
really entrepreneurship. But I went through both
of those experiences, and I would say that they were good experiences overall
though, because one, I got to get some capital to
invest into my businesses, and two, it taught me, you know, what is really important
in life, which is freedom. Financially, time freedom,
and location freedom, all of which I did not have
when I was a full time student, when I was working a full time job. So you guys need to be more resourceful when you consider all the
opportunities are at hand, and all the tools that you have
are available, within reach. And you need to use ’em
to the fullest extent. Because I see most people just wasting all the opportunity, all the time, and all the technology that we have, and just wasting it on
all the wrong things. For just, you know, temporary pleasure, just watching entertainment, and just, you know, stuff that doesn’t even make you feel fulfilled or make you feel really even that good. And it just, you know, this is just stuff that helps you to coast through life, watching Netflix, right, wasting time. It may feel kinda good right now, and it doesn’t feel as bad
as putting in the time, and the pain and the
sacrifice of studying, and looking up business opportunities, and also, you know,
squirreling away 10, 20% of your paycheck, it doesn’t
feel as good as that, for now, but I promise that in the future you’re gonna thank yourself. So, that’s the third most popular mistake, it’s people just not being resourceful and having the limiting
belief that you know, they need all this time,
they need all this money, they need all this knowledge and skills to start today. Alright so the fourth most common mistake that I see beginners make when
it comes to passive income is only thinking about defense. Now, when it comes to
finances, I like to think in terms of offense and defense. So, what’s offense, and what’s defense? Defense is the traditional
way of investing which is stocks, which is real estate, which is generally safer investments in the sense that you know,
your grandma, your grandpa know what these things are. And they’re generally pretty safe, compared to offense, which is creating passive income streams, which generally these days
means starting up a business. Now, when people think
of starting a business, most people are thinking
the traditional term of creating like a brick
and mortal business, like a restaurant, you know,
actually opening up a shop which has so much overhead, requires so much capital
up front to start. But the truth is, with this
day and age of the internet, and you know, having online
business such as e-commerce, you know, we can really
create a low overhead, and low risk business online through so many different business models. Now, I’m just gonna name
some of the big ones today, affiliate marketing is my favorite one, because as an affiliate,
this basically means that, you know, you sell
products of another company. So you sell their products or services through links and you can put
these links on your website, on YouTube and you get paid
a percentage commission, for every single person that you refer, who makes a sale, and
affiliate marketing to me is my favorite business model because it is the most
passive business model out of all of the one I’ve
researched and investigated. Now some of the other business models are e-commerce, you’ve
probably heard of things like Amazon FBA, which is
fulfillment by Amazon, you basically buy a lot of units, you know there’s a minimum order quantity, so it’s generally around
500 to 1,000 units of a product, and it’s usually from China, because that’s where you can
get the products for cheapest. And you private label them, you give them your own
brand, you ship them off to an Amazon fulfillment center, and then people can order
your products through Amazon and actually get Amazon Prime because you’re going through
the Amazon FBA program, which means fulfillment by Amazon. So, you’re actually sending it
to their fulfillment centers, and they’re not called warehouses, it’s actually fulfillment center, and they fulfill the orders, they are the ones who actually ship out and handle everything as
far as the physical labor when it comes to your product. Now another one is Dropshipping. This is something you
guys may have heard of. Usually it is referred to
as Shopify Dropshipping, even though Shopify is just the software that a lot of people use to
run their e-commerce stores. Dropshipping is the method of basically having a more hands off approach, where you’re shipping products
directly from the supplier straight to the customer, so you’re not actually getting
your hands on the product, so this can be lower
overhead than Amazon FBA, but the problem is with
Dropshipping is you’re on our own. You don’t have Amazon, which is basically something you can piggyback off of, you know, it’s the second
most valuable company in the world right now, next to Apple, and Amazon has done the hard
job of getting the customers, and getting their billing
information, their credit cards, and they make the buying process so easy. With Dropshipping through Shopify, obviously you don’t have that database of millions and millions of customers who already have Amazon Prime, and are already ready to be ordering all of their products through Amazon. I know I myself, I order products
from Amazon all the time. Been an Amazon Prime member for years. And I just don’t see, you know, ordering from another company, unless I just can’t find it on Amazon. So there’s Dropshipping, you
know, there’s e-commerce, there’s Amazon FBA, there’s
affiliate marketing, there’s creating a social
media marketing agency, which is not passive, in the sense that, you know, that’s real work, honestly. When you create an
agency, you’re basically doing the Facebook ads,
or the Instagram ads, or growing someone’s Instagram, or growing their social media. And you get paid a monthly retainer, by doing these services for that company. Now, my personal issue
with an agency is that it’s not passive, because
you have to be constantly working and it’s usually your head that’s on the chopping block
when it comes to the client, and if the client is not
satisfied with the results, and if you’re not getting
results fast enough, and if they feel like your
service is not worth it, then they’re going to cut the contract, and you know, basically you’re
gonna have a lot of turnover, and I’ve seen this with a lot of agencies, is they’ll have a client
for one month, two months, and then they’ll leave
and they get new clients, and then old clients
they’re not able to retain. And it’s just that headache overall, unless you have a real system to it. But, at the end of the day, I just don’t like being bossed around, and the problem is when
you have an agency, it’s like having more than one boss. So if you have 20 clients,
it’s like having 20 bosses bossing you around,
telling you what to do. And I just don’t, it just
doesn’t sit well with me. So, those are some of the
biggest business models, in this day and age, just
to, you know, show you guys that there’s opportunity out there. You guys can do your own research, or go to my website odiproductions.com to learn more about the
different business models from some actual experts in the field. So, basically my issue
is that most people, when they think of passive income, they only think defensively. They only think about investing
into an investment account, so you know, mutual funds,
index funds, stocks, or investing into
something like real estate. And the truth is, in this day and age, you have so much opportunity and you have so much technology and tools, that you can actually create
a passive income source, and you can have so much higher returns with a lot less risk and overhead. Because just to give you concrete example, let’s say you had $10,000 to invest into an investment account. And again, you know, I’ve used two to 3% for a conservative year to
date earnings and return, but let’s say you actually
get returns of 10%, and that’s, you know, that’s
actually on the higher end, it’s a little more risky, and basically you have
this account, right, you put $10,000 in and you get 10% return over the course of the year. Now, at the end of the year, that account is gonna grow, you know, there’s compounding interest
that’s involved here. But basically, you’re going
to earn around $1,000, okay. Now it grows because,
you know, month to month, if you get 10%, you know,
over the course of a year, so that’s $1,000 overall,
but the month to month it’s gonna look at lot different, because it’s not just
gonna be one flat amount, because the accounts gonna be growing while you are earning money, and while the account
is growing, you know, each month it’s gonna be getting bigger, and bigger, and bigger, but it’s gonna be a different amount. So let’s just say 10% overall,
over the course of a year, just to make things
really simple math-wise. So, 10% of $10,000 is $1,000,
and you know, that’s great. A lot of people, when it comes
to let’s say a tax return, and getting that tax return checked, it’s a nice bonus of like
$1,000, and a lot of people, they take that money and
they go and spend it, they go buy something, you
know, real consumer like, they buy clothes, maybe they
even put it towards a car or something like that. But the truth is you know,
when we think about $1,000, it’s not really that much
when you compare it to creating an online business, because online businesses
can create more than $1,000 over the course of the year,
if you really think about it. And in my last video, which I made about four
passive income ideas for 2019, I actually show several
passive income sources that, on complete autopilot
are earning upwards of 200, 300, 400, 700, and even as high as $20,000 per month, and this is all on autopilot. It’s 100% passive, after I
put in the time to set it up, it’s been on autopilot. And so if you consider an account that’s making $500 per month, and this is a passive income source, so it’s a business, right, and I put up the time upfront, but if it generates $500 a month over the course of a
year, we’re looking at close to, you know,
$6,000 rather than 1,000 from an investment account. Now, the flip side of this is I didn’t have to put up $10,000 for this passive income stream. Okay, when we talk about these businesses, like affiliate marketing,
again a website can cost as little as three to $4 a month. So we’re not investing 10,000 up front in order to make large amounts of money, so if we’re talking about
creating a website for $100, and you know, even if we add
in all of the other expenses, you know, there’s
different varying expenses for each business, but let’s say you invest $1,000 into your business, that business can then go on to generate thousands of dollars, and actually have returns of over 100%. And you’re not really gonna
see returns of over 100% when it comes to things
like conservative stock, investment accounts, you
know, even real estate, to an extent, you know,
nothing is guaranteed, nothing is completely safe or guaranteed. I know the real estate market right now, it’s very, very volatile, and it’s just something
that is not as guaranteed as it was let’s say,
you know, 20 years ago, but if you look at history, I mean if we look at all, you know, the stock market crashes, if we look at all of the
things that have happened, like economic disasters,
then I wish we’d have a little bit more long term memory, where we’re actually remembering that history repeats
itself again and again, and that’s why we have these huge bubbles and crashes and everything. And people need to be a
little more cautious and weary of you know, that nothing
is guaranteed in this life. So, you know, when we’re
talking about investments of time and money, I’m
really big on offense, because when I started I
just did not have the capital or the resources to really
make a significant income through the defensive side of things, which is again, stocks, real estate, the more traditional investing. I only had time, right, as
a broke college student, I didn’t have a lot of money,
but I had a lot of time. And I used that time to create
these passive income sources, which again, if we put in
$100 to make a website, that website goes on to
make a full time living, which I’ve done, and I actually shared in that free master
class in the description, if I’m able to create a full time living from $100 investment up front, then that to me, is just a
much better use of my time and my finances and my energy, than let’s say, waiting
for the stock account to make the 10% returns year over year. You know, it’s just not fast enough, if I want to achieve my goals, you know, sooner than later. So, that’s just my opinion. Again, offense and defense, I
believe in a varied approach where we have both, but if
you have to focus on one, I would focus on offense,
especially if you’re younger. If you’re younger and you
don’t have the obligations of having a family, and
having mouths to feed, which is, you know, that’s a huge, huge responsibility and obligation, and you need to be thinking about them first before yourself. But if you’re young, and
you’re single, right, not married, and you don’t have any kids, and you can afford to take risks, I’d rather risk my time right now to create these explosive
passive income sources that have so much more potential to really create explosive income of upwards of you know, 3,000, 5,000, 10,000, 20,000, 30,000,
$100,000 per month, which has been done before,
and I’ve done it myself. I would much rather invest that time, especially when I’m young,
when I can take risks, and I can afford to waste time. Because people waste time everyday, right? So that’s just my opinion, and when it comes to
offense verses defense, I believe a split of
something like 80% offensive, 20% defensive, or 70,
30 offense and defense, I think that is a really,
really great ratio when it comes to splitting
our time, our energy, our resources, because at least
you have the defensive side to protect you, because if
you make a lot of money, but you spend all of your
money, and you blow it all, then you’re not going to, you know, you’re gonna find
yourself in a great place. Two, three, five years from now you’re probably gonna go bankrupt. No matter how much money
you’re making, okay. So it’s important to have the
defensive side of the game, but I would focus on the offense, just because for me, offense
is what truly gave me the life I’m living
today, it wasn’t defense, because you know, the defense is good for maintaining your wealth, keeping up with inflation,
okay, and growing it, once you already have the wealth. But if you don’t have
the wealth right now, you need to create your wealth, and it’s hard to create your wealth when we’re talking returns of you know, two, three, 5% even, you know. You’re gonna need a lot of money up front in order to see huge, huge dollar amounts, in terms of what you’re
earning from those accounts. Alright, so the fifth and final most common passive income mistake I see beginners make every single day is not starting right now. And again I wanna stress
that the importance of this, and the importance of passive income is more so your habits, and
developing the right habits, and also your mindset of
investing, going into this. Because the truth is, if you
never develop these habits, it doesn’t matter how much money you make because you’ll end up blowing it all, because you are not investing, and you’re not, you know, setting aside money for the future, and allowing your wealth
to grow, and you know, maintaining your wealth, and
taking the steps to make sure, that you know, you’re planning ahead, and that you’re investing into yourself. So, the truth is, this kinda
ties in with the third point of having that false belief
that you need a ton of time, or you need a ton of
resources and capital up front to even start making passive income, which is simply not the case. So I wanna share that story
again of my first website. If I didn’t have a high tolerance
for delayed gratification, I would’ve quit that
website after three months, because in the first three months, that first month I actually
only earned $32, right. But this is an income source that eventually would go on
to earn over $3,000 per month in passive income, and
actually be my first success when it comes to creating
an online business. Now if I had quit that within
the first three months, I would’ve never seen the 1,000 per month, 2,000 per month, 3,000 per
month, you know, results, if I had quit at the very beginning. Because again, $32, $20
is not enough, you know, to really get people excited, but for me, I was so excited because I
knew that every single dollar that I earned through my
business and not through a job and not through another company, was actually worth so much more, because it was passive,
it was money that I earned from putting in the work up front, and I knew if I could just
grow this income source, to replacing my full time job, then I would have so
much more time freedom, and location freedom, because I would work from this business from
anywhere in the world. Now, the truth is, people
who think that, you know, you have these limiting
beliefs where you need $10,000 to even get
started with investing. The truth is you need to develop the habit of investing, no matter
what the dollar amount is, no matter what your account is at, whether it’s $1,000, whether it’s $10,000, whether it’s $100,000,
just because you don’t have a certain dollar amount doesn’t mean you can’t start investing today. That’s why I recommend that, you know, you start investing even if you were working a job right now, if you just take your paycheck, and you set aside 10, 15,
20% of every paycheck, start putting it into an account, just to start getting into the habit of putting money into an
account and investing, and then watching that
investment grow over time, it’s gonna get you really excited, because once you see that money grow, without you touching it,
right, you put it into a conservative account, and
it gets those annual returns, two, three, 5%, you literally
get to see your money grow, and it’s exciting seeing
something start so small, and then just grow over time,
right, month over month, year over year. So I want people to think more long term, in terms of not just you know,
is this working this month? Is this working, you
know, is this gonna go from zero to 5,000, 10,000
a month in three months? Because that kind of thinking is actually what’s preventing you from starting, and it’s what’s preventing
you from succeeding, because you’re just gonna get discouraged at the end of the day, if you know, you have these unrealistic expectations, and you think that this
passive income thing is just some magical machine, that you just press a
button and all of a sudden, it’s gonna just, you know, make you rich. It just doesn’t exist, so
we have to start thinking in terms of a game plan,
and a long term game plan, that is filled with, you
know, delayed gratification, but also this belief that
it’s gonna grow in the future, but you have to be willing
to put in the time, and you know, the investment up front. So, people should really start today, when it comes to investing. Again, it can be something
like setting aside a portion of your paycheck, it
can be spending an hour a day to research business opportunities, and start building up a low
risk, low overhead business, such as affiliate marketing, and you know, just getting into the habit of creating multiple income sources and
also investing your money. Because most people, they
trade their time for money, and then they just go ahead and
spend their entire paycheck, and then do it all again
and they get on this cycle where they never actually get ahead. They never actually have
any savings in the bank, even though they make
all this money, you know, through a full time job, they actually aren’t creating
any wealth for themselves, because they’re not investing
the time or the money to either grow the finances and the money that they have right now, and they don’t spend any
sort of time or energy to research all the opportunities that are at hand, and you
know, really using the tools such as a smart phone, you know, with all the internet access in the world, and all the knowledge that’s available, and instead just using those
things for entertainment, for just short term pleasure, right. So again, delayed gratification
is really the secret to be successful with passive income. And you know, most people these days are just instant gratification focused that they will never,
ever get to that point, and it’s sad but the truth is, if you’re watching this video, I know you’re one of those people who is investing time into themselves, into their education and self education, and I know that you’re on the right track. So if you heed these five
most common mistakes, when it comes to passive income, I know it’s gonna help you guys so much. And if this video has helped you, please, drop a like and a comment
below, letting me know. Make sure you type in passive income, and if you have any questions for me, feel free to ask me in the comments below. I like talking to people in the comments, I like to respond to as
many comments as I can, even though I’m pretty
busy, YouTube comments is probably the one place
where I am most active, especially right after a video upload, so shout the notification squad. If you’re not subscribed,
make sure to subscribe, and hit the notification bell, because if you don’t hit the bell, you’re not actually
subscribed to my channel. Aside from business and entrepreneurship, I also love cars, as you guys
can probably see my garage in the background. I love cars, and I’m looking
to make more car content, especially this year in 2019. I haven’t really made
that many car videos, so I want to get more
involved in the car community, and I just can’t wait to do that. And the last place you can connect with me is on Instagram, @odi_productions. You guys can come check
out some of my cars. You guys can, you know, check
out some of my content there, and maybe my daily stories. But other than that,
that wraps up this video. I hope you guys enjoyed it, and I will see you guys on the next one. Oh and the last thing I wanna mention, if you’re interested in these low risk, low overhead businesses, especially when it
comes to passive income, I think affiliate marketing
is the best business model for creating a passive income source that I truly believe that
anyone can start, you know, regardless of your passion,
regardless of your skills, you can find a way to create a passive income source
with affiliate marketing. So if you wanna learn more about that, make sure to join my free two hour passive income masterclass
in the description below, and also visit my website,
odiproductions.com, if you want to learn more about
the online business model. So, until next video, I will
see you guys on the next one. Peace. (gentle music)


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