What is Passive Income?

It is a source of income that is set up in a way where it continues to come in, with little or no work required.  Something that is set up and then can be left to earn you money.

Some examples of this:

  • Earnings from a business that does not require direct involvement from the owner or merchant;
  • Rent from property;
  • Earnings from internet advertisements on websites;
  • Residual income, repeated regular income earned by a sales person, generated from the payment of a product or service, that must be renewed on a regular basis in order to continue receiving its benefits;

Recently I looked into an interesting Passive Income source. Owning Water Vending Machines.  Its a water filtration system that filters on the spot.  People can fill their water bottles of any size for 50 cents a gallon.

Naturally, with different locations being more productive than others, you may luck out and make more, or also the other way, not as much, however, the average income from one of these machines in $458.

Now, here’s the thing, the machines cost US $12,500.  Minimum order of 10.  They will, for a fee, do all the maintenance on them for you,  so it could be a completely hands off business.  Putting out $125,000 up front is a lot of money, but it has the potential to bring in a bit of cash.  Lets say that your 10 machines average $400 a month, that’s $4,000 a month income.  $48,000 a year.  That’s not bad in my mind!

Now if only I had the initial money to put down.