5 Passive Income Mistakes – The Investing Mindsets and Ideas


five passive income mistakes you better
learn to avoid before you try and fail we are going to discuss on how to become
smarter and successful while investing for passive income and also I’ll tell my
story hi I’m Henrikh from Value Investing I’m going to tell the importance of
passive income and go over common mistakes people mostly are facing
passive income is the money you get constantly in a way that required little
to no effort to maintain with this advantage you can have enough time to build your other passive income sources or to increase your active income this
is one of the most important things in becoming wealthy and to live the life
without worrying about the bills of next month passive income generally will not
make you rich overnight so please forget about the magic formulas of
get-rich-quick schemes you have heard so far but steady profitable passive income
can make you really wealthy in the long run as Warren Buffett said if you don’t
find a way to make money while you sleep you’ll work until you die okay now let
me introduce the five passive income mistakes and also I will tell my stories
which were really expensive lessons for me I made at least two of those mistakes
in my investing journey which were the hardest way to learn watch this video to
learn the lessons in an easy way not like me and always try to learn from
other people’s mistakes there is absolutely no need to fail lose money or
go broke in order to learn something be one step forward to learn from those who
already went through the hard way okay let’s start the mistake number one
passive doesn’t mean permanent many people build a small business and put
some automation system there and when the profit starts to come without a need
of a hard work by them they think they have reached to the passive income
that’s false passive income that’s actually even not a passive income
that’s just a way to get paid more based on an hourly work they do because sooner
or later they get bitten by the competitors
who are willing to work harder on the same sphere real passive income must
have sound fundamentals and in most cases it must have real asset value in
fundamentals and to be even safer the income should not be from a single
source so to be sure we have the real passive income you must have a business
with I think more than 500 employees and with a system that have proven to work
that was right when we talk about passive income from businesses not from
assets like real estate stocks bonds licenses or other paper assets mistake
number two not starting small people don’t like the idea of investing for
passive income to get income like two hundred dollars monthly that’s a really
big mistake if you are waiting to save $1,000,000 to invest to get ten thousand
dollars monthly you will most probably not see the passive income starting
small is important for at least three reasons reason A you better start sooner
to get advantage of compounding interests reason B you must train
yourself with real experience until you invest big as almost everyone does
mistakes when starting and the reason C believe me if you do a few small deals
and you get $1,000 monthly that will help you vastly even if you are living
in a city that you need seven thousand dollars to live on ok let’s go to the
next passive income mistake number three no active income before you start
building your passive income sources make sure you have an active income to
live on that’s my first mistake when I started by investing journey I started
my first steps in financial education when I was 21 and I loved the idea of
passive income so much that I forgot to generate active income firstly my main
focus was to build a passive income and I was doing nothing for active income I
started businesses and failed for three years and my liabilities went
through the roof as I was not able to generate active income when you start
investing you do a lot of mistakes for sure and you lose money and the effect
of going broke is becoming way bigger when you add up your liabilities with
living expenses also so when you start building your passive income portfolio
you most probably lose money at the beginning so make sure you have enough
active income to cover your living expenses otherwise the difficulty of
success becomes a few times harder so when I understood that I must build the
active income first that was already too late for me and I collected debt for
3 years which put me in a situation which was way harder as it normally
should be mistake number four forgetting the asset value this passive income
mistake is again something that I did myself which was a really big expensive
lesson for me the first real estate that I bought to rent out didn’t have the
full legal document it required the land had no ownership but the building on it
had and while I was happy to collect the rent for a few years I finally faced the
problem that my government want to demolish this building because of the
lack of the documents it was a very small shop on the sidewalk of the street
and the new government really didn’t like the idea of having it there so
while new government was trying to remove all that kind of buildings in the
city the asset value was dropped really because nobody wants to buy that kind of
real estate as it has a big risk so I paid about $15,000 for
the building and collected rent for about three thousand dollars yearly
which is about 20% cash on cash return twenty percent that is an excellent
investment right wrong that was a terrible investment as I did the number
four mistake of passive income investing and I forgot the asset value while being
happy collecting the rent passively so make sure
your investments will not go down in value while investing for passive income
oh by the way these are my favorite top ten books about stock market investing
if you don’t have any of those you definitely need it on your bookshelf to
ease your job I put the Amazon link in the video description where you can go
and grab it with just one click if you want to expand your skills in this sphere
those are the most valuable books about stock market investing you can learn a
lot starting from Benjamin Graham the father of value investing going to
Warren Buffett Phil Town the rule one investor with his daughter Danielle Town
Guy Spier Peter Lynch the 29% guy Jason Zweig one of the greatest minds Robert
Shiller from Yale University and of course Andy Tanner from Rich Dad
Education founded by Robert Kiyosaki these books include both easy read and
hard read for beginners and also for pros reading all those books will put
you in a big advantage in the stock market go buy them for you and for
people whom you care about the links are in the video description okay let’s go
to the number 5 mistake of passive income investing and that is relying on
promises always do your own research and analysis if your investment is a good
one or not having someone promise the check is not a good passive income
source not only one can lie to you but also one can have more than realistic
expectations from the business he runs mostly this refers to investing in
dividend stocks when a company paid dividends for five or ten years that
doesn’t really mean that they will continue to pay the dividends in the
future or at least with the same rate they did before you must make sure you
are investing in a wonderful company that will have business growth and not
die in the long run and to find the real wonderful companies
which will have a growth in the long run I would suggest the value investing type
of investing strategy to make sure the company’s numbers are good enough it has
constancy the economic moat a good management team and a good price to buy
also please check my other video about the margin of safety to get more
understanding about what it really means to buy a stock or any other asset at a
good price how to determine if the price is good to buy or not okay those were
the five passive income mistakes to avoid to be a step forward and to save a
few years in your future for becoming successful okay now I mostly want to
know your thoughts about those five passive income mistakes and if you have
your story please share with us leave your comments below and subscribe and
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video so that you don’t miss it and if you could take any value from this video
please hit the thumbs up button and share with your friends thanks for
watching have a good day

One Reply to “5 Passive Income Mistakes – The Investing Mindsets and Ideas”

  1. Did you have a massive passive income mistake in your lifetime? Do you know a very big mistake that we all can learn to avoid? Please share with your experience. Comment below!

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