Passive Income

Passive Income

This is the first in this series of posts on passive income.  We will look at the various ways you can create passive income. I have written about passive income many times on this blog. Passive income is also called residual income or recurring income.  It is critical to any wealth creation plan as it is income that continues to be generated after the initial effort to create it has been expended.

In this series I am going to look at the various ways you can build a passive income. I will also examine what is really “passive” and discuss that not all passive incomes are created equal.

Passive Income

Passive Income – why do you need it?

Passive income or residual income has always been important but now in today economic reality it is critical. Why? Because without it you will be working until the end of your life . Do you think your government will take care of you in your old age?

I have a Business Degree, qualified and worked as a CPA for many years and then had a financial planning business. I subscribed to the idea that I would work until I had enough money put away to retire. I advised my clients to do the same.

I like most people prior to the Global Financial Crisis (GFC) subscribed to the idea that putting money into a retirement fund was a good idea. In Australia employers must pay into their employees Superannuation Fund. At the time of writing it is 9% of their annual salary. Superannuation is like a 401K in the USA.

We all know what happened to many people’s retirement nest eggs in the GFC and now many people do not know how they will ever retire. The only way I know is for you to build a residual income. An income that will be paid to you month in month out for the rest of your life.

Passive Income – what is enough?

Robert Kiyosaki invented a board game called CashFlow. In this game the objective is to get out of the Rat Race and into the fast track. The way you do this in the game is to build your passive income to be greater than your living expenses. In the game you can land on things like “divorce” “being downsized” tax “audit” and other things that happen in life.

If you have not played the game and you are even vaguely serious about building your financial security then I really encourage you to play it. I have played it 100s of times and I learn something about myself and my relationship with money each time.

As I worked with Robert Kiyosaki and we sold the game I know many students of his. We formed a group several years ago and played CashFlow regularly. We graduated to playing in teams which was really interesting and I found I learned more about my behavior in this situation.

Robert says “how you play the game is how you play in life”. I think it is better to learn  about attitudes that do not support our success in business and investing by playing a board game than by having the lessons in real life.

I am not suggesting you will not have any “learning experiences” in real life because you played the CashFlow game but you will get to know more about yourself and the choices you make. It is a good way to get those subconscious beliefs you may not know you have out on the table.

Passive Income – the true road to freedom

It is only by having a passive income that you will build true freedom. And it does not have to be only for retirement. There is a growing number of young people who have found a different way to do their lives. They are building passive incomes and living lifestyles that allow them to travel and follow their dreams.

This concludes my first part in this series of “Passive Income”. My following posts will look at a variety of ways you can build a passive income and the pros and cons of each method. We will also look at using leverage to build your passive income.

Please leave me your comments on Passive Income below. Are you building one? Do you see the importance of building a passive income? If you found this post of value please share it with your friends.






Sue Price
Skype: sueprice

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70 thoughts on “Passive Income

  1. Gen

    I love the Cashflow game. I got to play it for the first time at a Robert Kiyosoki event a few years back. It was a lot of fun and one of the best things was when the speakers showed us a faster way to get out of the rat race.

    And learning to create passive income comes much the same way we were shown during that event. It was a simple shift and once you looked at the game and your relationship with money. But it required being able to think out side the box.

    Passive income is the best way to grow your income and make your money do the work for you.
    Gen recently posted..My Week at a Glance.My Profile

    1. Sue Price Post author

      Hi Gen

      I love the game too and your experience sounds awesome. It is a fun way to learn and very powerful.
      Oh yes passive income is the best income to have for sure. I continue to be surprised at how many people do not understand it.

      Thanks for your comment


    1. Sue Price Post author

      Hi Jenny

      I can imagine how many times you and Gary have played Cashflow. I agree with you that sometimes the insight is in hindsight.

      Thanks for dropping by to my blog.


    1. Sue Price Post author

      Hi Barbara

      I agree with you I am always amazed at home many people do not understand residual/passive income. It is a soap box for me 🙂

      Thanks for the comment


    1. Sue Price Post author

      Hi Fred

      Passive income does take work to achieve it for sure. I am not sure it has to take a very long time though. I have seen people work hard and achieve it in reasonable times.

      Thanks for your comment


  2. Mandy Allen

    Yes, how much is enough? For me I would ask myself what are the extra things I need, then what are the extra things I want in my life. That will help me to setermine at this stage what the passive income level I am aiming for. I would have to review that every so often though!

    Enjoy the journey.

    Mandy Allen recently posted..Making Sure Your Video Is CentredMy Profile

    1. Sue Price Post author

      Hi Mandy

      That is a great question – how much is enough? It varies for all of us of course and I think the more we earn the more we learn to adjust our spending accordingly. I think it is an excellent idea to do what you say and work out all the things you want and then work backwards to know the income you want to create.

      Thanks for dropping by and commenting.


  3. Sylviane Nuccio

    Hi Sue,

    Do you know how many people in the US still beleive that if they work hard in their company they will be able to retire on their 401K? There’re still a lot of people thinking that way. I see some of them everyday.

    I think we belong to the few fortunate ones who know better and are trying to build our business to create own own retirement and an early one at that 🙂

    Thanks for another series, Sue 🙂
    Sylviane Nuccio recently posted..Are You Afraid Of Letting Go? Or How To Trust The Process Of Deliberate CreationMy Profile

    1. Sue Price Post author

      Hi Sylviane

      I am astounded to hear that about people in the US. In Australia the stats are very much more that people are afraid they will never be able to retire. I am sure there are some people with their heads in the sand though.

      Yes we are fortunate to be on the paths we are on.

      Thanks for your comment.


  4. Adrienne

    Hi Sue,

    What a wonderful post and a great explanation of what passive or residual income really is. I admit not understanding it all since all I ever knew before entering this industry was to work for someone else my entire life.

    I always thought I would work for the same company and retire, hey that was the American Dream. My reality was that I was never with a company more than seven years. They downsized, went into bankruptcy, were bought out, you name it and the regular staff just wasn’t always kept on.

    You can’t count on the “American way” any longer so if you don’t start understanding how to create passive income you might find yourself in a world of hurt pretty soon. There’s no time like the present to start learning right.

    Enjoy your week and thanks again Sue.

    Adrienne recently posted..Are You Making These Social Media MistakesMy Profile

    1. Sue Price Post author

      Hi Adrienne

      We grew up with the reality you had. I have a business degree and I still thought there would be job security for those who wanted it. I was fortunate to have come across people like Robert who helped me see reality.

      The American way became the “Australian way” too. I think today’s reality is that we have to be responsible for creating our own future.
      Those downsizing times are heart wrenching for people. I know so many people who have lost their jobs in recent years.

      Oh yes you are spot on there is no time like the present to start learning.

      Thanks for your comment Adrienne and you too have a great week.


  5. Donna Merrill

    Hi Sue…
    I just love a good series, especially from YOU! The American Dream was squashed a very long time ago. Some didn’t see it coming, some wanted to hold on to whatever “retirement’ plan they have had. I’ve seen many people suffer from this crash.

    I believe that passive income must come from ourselves. Being an entrepreneur for most of my life, I can understand that. It is something we need to create off line as well as on line. However we create it, it must be done.

    Here in America, we were brought up with the “American Dream” that is now turning into the “American Disaster” and if one doesn’t have financial leverage, they will probably end up victims of society. All it takes is a little common sense, facing reality instead of holding on to what we have learned in the past and we can see the clear picture.

    Thank you for posting this and I’m looking forward to your next post!
    Donna Merrill recently posted..MastermindingMy Profile

    1. Sue Price Post author

      Hi Donna

      Thanks for your comment on my series I so appreciate that.

      This crash has been terrible for people all around the globe. I remember the 1987 stock market crash well as I was in the financial services world but I am sure it was nothing like this last one.

      Oh you are spot on we must create our own future and I think you have hit the nail on the head in saying people must face reality. I think that is much of the problem when people do not they feel powerless.

      I feel we can do our bit by getting our messages out there.

      Have a great rest of the week Donna


  6. Lesly Federici

    Hi Sue,
    I have not played the Cash Flow game. I’ve read about it in his books. This year when my son goes back to school he is required to take an “economics” class. It made me wonder, what kind of economics? The kind that has been taught for many years? Or the kind that includes passive income and having your own business. It will be interesting to see… informative article as usual! Thanks!
    Lesly Federici recently posted..A Dental Challenge And A ShakeMy Profile

    1. Sue Price Post author

      Hi Lesly

      I am sure you will love the game if you choose to play it. I hope they have changed what they teach in economics over the years. When I did my business degree it was all based on limited resources and win/lose mentality. It will be interesting to see what your son is going to learn.

      Funny isn’t it that so many great entrepreneurs are college drop outs.

      Thanks for your comment.


  7. Viola Tam

    Hi Sue,

    What a blessing that you are sharing this in your blog! I sincerely wish that with your educational back ground, working experiences with Robert Kiyosaki and your own network marketing success, many people’s lives can be changed for the better.

    Many people do not know what they don’t know. This means that their career choices can be limited. One of my business mentors is a dentist. He is also a big believer in residual income – as true freedom (and security). It took him 10 years to figure out that having 5 degrees (including Master Degree and PhD) may not be the best way to go!

    I cannot wait to read your next post. Keep up your excellent service to others, Sue!

    Viola Tam
    Viola Tam recently posted..MLM Success Tips – Effective AffirmationMy Profile

    1. Sue Price Post author

      Hi Viola

      I feel very passionate about this topic given my experiences as you say.

      Oh yes so many people do not know what they need to know and your dentist is an example of so many people who have formal qualifications but do not have the business knowledge needed to build wealth.

      In my days as a CPA and a Financial Planner I worked with many specialist doctors who had no clue when it came to financial decisions.

      Thanks for your comment Viola and I am glad you are looking forward to my next post.


  8. Carol Lynn

    I never heard of that game but it sounds really interesting… and maybe a little scary?? I don’t know if I really want to find out what it says about me, lol…

    Seriously, passive income is the holy grail of business. There are only so many hours in a day that you can work and accrue billables. At some point you’re going to max out – and probably burn out. But if you can generate passive income then you give yourself some breathing room.

    There’s a lot of talk about the economy “recovering” but personally I don’t think there’s anywhere for it to go. I think this is our new reality. Big businesses get richer and more powerful and everyone else has to figure out how to survive. I’m not trying to be depressing but unless there’s is some MAJOR shift in politics and power, this is it. So what we have to do now is figure out how to make it work for us. We have to be smart, flexible and adaptable. And we have to find the ways to use our resources.

    Looking forward to reading more of your series!
    Carol Lynn recently posted..Marketing In The Goldilocks Zone: How Do You Know When You’ve Got It “Just Right”?My Profile

    1. Sue Price Post author

      Hi Carol

      I was nervous the first time I played Cashflow. I think Robert Kiyosaki standing over me shaking his head did not help 🙂
      I really recommend you play it if you get the chance. It is revealing.

      I do not know where the economy is going either. I think things have changed and it will not go back to the way things were. I have a feeling we will see more and more people doing it the way we are working from home. I live in a holiday seaside town and there are many people doing various things on the internet. Tonight I am going to a MeetUp for Internet Marketers. We meet once a month.

      And yes I like your comment passive income is the holy grail of business.

      Thanks for commenting Carol.


  9. Romy Singh

    Hello Sue,

    “CashFlow” I never heard about this game till now so don’t know anything about it. But very soon I’m going to try it.

    And as far as passive income is considered I’m trying very hard to create it. And the best blog I follow for advice is SmartPassiveIncome.Com by Pat Flynn. Here I learn about how to create a online income source like affiliate marking, PPC etc.. And Now I’m also going to follow yours.

    Thanks for the nice explanation about passive income and waiting for next post of this series. 🙂
    Romy Singh recently posted..We Always Want Success Without Any Failures. It’s A Human Nature.My Profile

    1. Sue Price Post author

      Hi Romy

      Thanks for finding me and for your comment.

      I do hope you pay CashFlow as it is so good. It is best to play with a few people.

      I have not seen Pat Flynn’s blog but I will be going over there now.

      Thanks for following my blog.


    1. Sue Price Post author

      Hi Clemence

      Oh so was I nervous the first time I played Cashflow. I was mainly nervous because Robert was walking around the room making comments. I kept landing on Doodads and Robert was sort of smurking saying “how you play the game is how you play life”.

      Thanks for commenting.


  10. Samantha O'Connor

    Hi Sue,

    Wonderful Post! I agree that passive income is essential, especially these days.

    I have much respect for Robert Kiyosaki, and love his books. Everything has changed with the Global Financial Crisis, and we need to empower ourselves with residual income as there is no security anymore with a regular job.

    Appreciate you sharing this, and helping people become aware that they can get out of the rat race and onto to the Fast Track!
    Samantha O’Connor recently posted..What happened out on the zipline this week…My Profile

    1. Sue Price Post author

      Hi Samantha

      I am glad you see the importance of passive income. I love Robert’s books too. Do you have a favorite one?

      I think most people would agree with us that job security has gone.

      Thanks for your comment. I appreciate it.


    1. Sue Price Post author

      Hi Matt

      Oh yes do play the game. I am sure you will get some deeper insights and it is fun.

      Thanks for dropping by.


  11. Oliver Tausend

    Hi Sue,

    have you ever noticed that the high priests of “passive income” work like crazy, such as T. Harv Eker and namely Robert Kiyosaki ? Have you ever wondered why ? Of course, I can just make assumptions about their reasons, but I think the question needs to be posed. Anything requires at least maintenance even if you hire people as managers.

    Thanks for sharing your insights.

    Take care

    Oliver Tausend recently posted..Is There Such A Thing As Passive Income ?My Profile

    1. Sue Price Post author

      Hi Oliver

      Oh you are spot on with your “high priests” comments and yes I have wondered why Robert worked like he did when he was set up for life. I have asked him the question and basically he was driven by a huge goal. I cannot comment on T. Harv Eker and would be making assumptions if I said anything.

      It was during my time with the company promoting Robert, Blair and the others we had the conversations. What is passive – and is there really anything that is “set and forget”. I totally agree with you that everything requires maintenance.

      You will see some of my beliefs in my next posts 🙂

      Thanks as always for your comment Oliver.


    1. Sue Price Post author

      Hi Elaine

      Thanks for your comment and I hope you enjoy the posts to follow 🙂


  12. Warren

    I love board games of every kind but this sounds awesome!
    I don’t know why I’ve never seen it before Sue, is it actually in stores or something you have to order online?

    Also looking forward to reading more on passive income (mostly the methods that work at generating it) 🙂

    I am starting to realize that while my blog makes money, its is nowhere near what anyone in their right mind would call passive! LOL
    Warren recently posted..Monetizing Your Blog – The first StepsMy Profile

    1. Sue Price Post author

      Hi Warren

      It is an awesome game. I used to be the CEO of the company that promoted Robert in Australia and New Zealand. The game was sold by various book stores here and stores that sold games. If you are in North America check where you would buy games. You can get it on the Rich Dad site. It is CashFlow 101 and is $195 on their site (I just checked).

      I am glad you are looking forward to this series of posts. It is a bit of a soap box of mine 🙂

      Oh I know what you mean about making money on our blogs not being passive. Hey running a blog takes work!

      Thanks for your comment Warren.


        1. Sue Price Post author

          Hey well done Warren. That is a good price. When the Aussie dollar was really weak against the US in the early 2000s we used to sell it for around $300. I still think it was worth it as $300 is not much to learn some really good money lessons.

          Let me know how you go and I would love to know what you think when you play it.

          Have a great day.


          1. Warren

            I grew up with very poor money lessons ingrained and still have a hard time with the concept. 🙂
            Even when I was broke I tended to under charge for things i did, or even do them for free often. LOL

            The lady that owns the game is gone till Sunday evening so will hear back. Told her I’d take it for sure so hopefully she doesn’t sell it to someone else. 🙂

            It even comes with 13 of his books (though it says two are duplicates) so definitely a great deal!

            I will let you know for sure!
            Warren recently posted..Blog Posting – Writing when the Ideas just won’t comeMy Profile

            1. Sue Price Post author

              Hi Warren

              I think most us of us grew up like your describe with poor money lessons. Our relationship with money is so ingrained in us if we want more we have to consciously do things to change how we view money and ourselves.

              Undercharging is also very common. I grew up with a self employed Dad who did that his entire life. I was lucky to work as a CPA in an accountancy practice where my chargeable time was pretty high and I sort of “grew” into thinking I was worth more.

              I hope you get the game. Fingers crossed for you. Wow 13 books with it – yes that is a cool deal. Have you read any of them?

              Thanks for your comment Warren.


    1. Sue Price Post author

      Hi Stacy

      Oh I love that quote from Jim Rohn too.

      I like your way of reference to the “new economy”. It is a healthy title I think more people need to see it like that.

      Thanks for your comment Stacy.


  13. Simmeon

    Morning Sue,

    Bet your bottom dollar I’m trying to make passive income.

    Luckily. I have youth on my side, so I can try for a long while (hopefully)
    If I could accumulate fund for my retirement that would be swell, but to be honest that feels like “LIGHT YEARS” away. However I’ll be focusing my efforts on recurring income that will help in the the battle.
    Simmeon recently posted..The CommentLuv Link That Refuses To Be ClickedMy Profile

    1. Sue Price Post author

      Hi Simmeon

      If I still had youth on my side like you do Simmeon I would be thinking like Timothy Ferris and going for the life style he promotes in his book “The 4 Hour work Week”. Have you read it? His idea of escaping the 9-5 and living anywhere while you build your passive income and business.

      I am glad to hear you see the importance of building your passive income.

      Thanks for your comment. Have a great day.


  14. Louise

    Hi Sue
    I haven’t played the Cashflow game in years. When I first played it I was just starting to learn about residual income and as you say, leart a lot about myself. It would be interesting to play it again and see if and how my attitudes to money and investing have changed.
    Thank you for sharing this post. It is is so important in this day and age to become financially independent. The days of working for a company for your whole working life and then retiring on a comfortable pension are long gone.
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    1. Sue Price Post author

      Hi Louise

      Nice to see you here. It is a great game and I know my attitudes to money have changes since I first played it so I am sure yours will have as well.

      I think most people know there is no whole of like job security but sometimes I wonder if there are still some people with their head in the sand. I know many people do not understand passive or residual income.

      Thanks for your comment and I think it is time we had a catch up.


    1. Sue Price Post author

      Hi Leslie

      I am glad you are going to read my series. I hope it helps. I think we need to be careful where we invest both our money and our time.
      Passive income is important though so good to do your research.


  15. Richa

    This is a great topic you have touched upon, Sue. I must confess I am quite unaware about the concepts of passive income. I will surely be following your series to increase my knowledge on the same. Thanks for this informative share.

    1. Sue Price Post author

      Hi Richa

      I do hope you follow the series as it is important to learn about passive income. Thanks for dropping by and commenting.


  16. Fatima

    In the current times of economic inflation and dynamic market trends we all need to have a passive income. Nicely explained with the Cashflow example. Thanks for the informative share.

    1. Sue Price Post author

      Hi Aayna

      Thanks for your comment and I am so glad you now know about passive income. It is important for us all to be aiming to build it.


  17. Kristine

    Hi Sue! Thanks for this salutary and timely post, I’ve never really thought about the concept of passive income and how it can benefit me and my family in the long run. I completely agree when you mentioned that having residual income will most definitely lead us to financial independence sooner or later. I cannot discount the fact that I fear what lies ahead most especially at this time when I’m spending beyond my means.

    1. Sue Price Post author

      Hi Kristine

      Not many people really understand passive income. It is something we should learn about in school but not sure that day will happen.
      I am sure most people fear what lies ahead in these uncertain times. Living like that is not what we should be doing we need to take charge. I hope you do.
      Thanks for sharing with us here Kristine.


  18. Joy

    During these tough times, it’s nice to discover that we can bank on something like this. Thanks for sharing this new concept. I am so eager to learn more about it! Awesome post, Sue! Cheers! 🙂

    1. Sue Price Post author

      Hi Joy

      Thanks for your comment and I agree in uncertain times passive income is very important. I do hope you continue your education on the subject and build one for yourself.

      Take care


  19. Warren

    Hi Sue, thought I’d stop back with an update. Just came from picking up my “Cashflow” package! 🙂
    The game looks awesome (everything actually looks brand new)
    And the bonus books were:
    1. The ABC’s of Property Management
    2. Cashflow quadrant (came with two)
    3. Rich Woman (I’ll read it anyway! LOL)
    4. Rich Dad poor Dad
    5. Real Estate Advantage
    6. Guide to Investing
    7. The ABC’s of getting out of debt
    8. Who took my money (looking forward to this one 🙂
    9 Increasee your financial IQ
    10. The ABC’s of building a business team that wins
    11. Rich kid, smart kid
    12. The advanced guide to real estate investing

    I’m excited to dig into these. Thank you for this, because you pointed me in the cashflow direction! 🙂
    Warren recently posted..Blog Updates Aug 26thMy Profile

    1. Sue Price Post author

      Hi Warren

      That is awesome and such a great price you paid for it. You already know the Cashflow Quadrant is my favorite so let me know what you think when you get to it.
      Rich Woman is great and so empowering for women.

      I have not read them all but many I have. Oh and the game is great.

      Thanks so much for popping back here and letting me know. Well done.


  20. Dipa

    So is this game available in the form or Monopoly-like board games? If so-What a lovely way to teach kids about money. Thanks for sharing- looking forward to more posts on smart passive income!

    1. Sue Price Post author

      Hi Dipa

      The game is a board game and while there is a version for kids I am referring to the one for adults. I have yet to meet an adult who did not learn something playing the game.

      Thanks for dropping by here Dipa


  21. Nina Corales

    This is a great share Sue! I am in my early 20’s at this moment and like you I aspire to build wealth. I want to have sufficient fund that I can use and enjoy once I retire.

  22. Elaine Salt

    I guess everyone is looking for passive income these days. Prices of good have increased yet the income of people are still the same. In fact, many people today do not earn any income at all.

    1. Sue Price Post author

      Hi Elaine

      Yes sadly what you say is correct which means many people do not have a nest egg to fall back on. Passive income is so important for us all.

      Thanks for our comment.