Common Way of Thinking for Income Generation Most of us growing up saw our parents get up early in the morning to prepare themselves to go work. As we progressed to teenagers we replicated our parents by having part-time jobs after school. I’d venture to say in most of our households that they were never any discussions about starting a business or investing in real estate. In our minds, there was only 1 tangible method to generate income. As we progressed to adults we prepared ourselves via going to college or trade school to hopefully put ourselves in a position to attract a high paying job to support ourselves. Once achieved there is a reassuring feeling that we made it, and especially if we have a better job than our parents.  Maybe after a few years of generating income in this fashion; you might say this is OK, but I just have enough money to support my lifestyle. If you ever heard of the phase have our money work for you instead of we working for our money.  The phrase makes a lot of sense, but how do we put ourselves in that position to live that phrase. This leads me to discuss the awareness of the other types of income that can be generated to reach financial freedom.   Types of Income As stated earlier working a job is the standard way of generating income and this is universally labeled as employment income. If we are renting an apartment the owners of the unit are receiving passive income.  Receiving income from operating as an owner of a food truck, will classify as active income. The last type of income is from investments from stocks, which is classified as portfolio income. So altogether there are 4 types of income employment, active, passive, and portfolio. Let us delve into each type of income category in the next section, and see how each fits into our goal of Financial Freedom.     Multiple Streams of Income Break The Chains of Financial Bondage Let me stress that immediately quitting your job isn’t a viable solution to achieve financial freedom. Instead of thinking of our jobs as a hindrance to achieve Financial Freedom, think of it as fund-raising to utilize the excess funds from our paychecks to assist us in generating income from the other income types.  True Financial Freedom can only be attained by generating income outside of employment income.     References Passive Income:  Income received on a regular basis requiring little to no effort to generate. That is the standard definition, but don’t believe it. You will need to apply effort to successfully generate income on a regular basis. Active Income (Our Version):  Income generated from a business that you own and or control. Employment Income: Is generally classified also as active income, but the key difference is that we have no ownership or control. Portfolio Income:  Income primarily from stocks, bonds, mutual funds, and annuities. Cash Flow:  Income minus Expenses should equal a positive number. This is applicable to our house budget, businesses, and real estate rental property.       The post Different Income Types: Generating Income More Effectively From Other Sources appeared first on The Mike and Cliff Show.