I remember having a conversation with a friend of mine a while back. Both of us were self-employed and could relate to each other’s entrepreneurial journeys.

We wanted to make it happen with our businesses.

But we were struggling.

If you are a solopreneur or have a side hustle, you may be well aware of the struggles. From figuring out what skills the market will pay for, how much to charge for our services, and where to find the next client to how to balance work with rest, not feeling guilty for taking a vacation, how to deal with imposter syndrome and self-doubt, the challenges that we overcome are immense.

That’s why I consider running one’s own business a surefire path to personal and spiritual transformation.

But I digress.

So it was one of those days when my friend and I were lamenting about the up and down cycle of our business (a little bit of venting only, to let off steam). And that’s when she said, “Wouldn’t it be cool to make passive income? To earn income while we sleep or while we are on vacation? I would love passive income so much and not have to worry about all of this right now!!”

On the one hand, she was expressing her true desire for “easy money”. You know, work a little and get paid a lot.

But what she was truly saying was much deeper.

She is a hard worker and does not shy away from taking action. So it’s not like she doesn’t want to do the work. For her the term, “passive income” was a nice symbol of ease and abundance at that moment.

What she was feeling was the frustration of the grind that a self-employed or solopreneur business can be. Creating content, solving problems for clients, finding clients, taking care of the house and family, and on and on.

She wanted ease and flow in her life.

She wanted a break.

She just wanted a breakthrough.

Passive Income is Not Passive

Passive income. It seems so many people are wanting passive income or think that’s what they want. And that is what the marketers cater their marketing towards — the desire people have for money coming in, apparently with little or no work.

First of all, those who have generated “passive income” know that there’s nothing passive about it — unless it’s dividend income coming from your portfolio investments. But even that requires proper planning and careful selection for crafting a winning portfolio; thus requiring an immense understanding of the financial markets and even macroeconomics, which means getting educated and staying informed in that world. Hardly anything about that is passive!

Cristof Ensslin, a financial adviser at Pine Ridge Wealth an investment advisory firm, alerts us: “With investing, it takes, at the least studying the market or if you don’t want to do that, then hiring the right financial adviser and staying in touch with them, to stay on top of things. Done right, investing is highly leveraged but not passive.”

And just read the following quotes that debunk the passive income myth.

Passive Income is a Misnomer

Passive income is a misnomer. It paints an inaccurate picture of what it seems we truly want.

What if what we truly desire is way deeper than that? And solopreneurs, freelancers, content creators, and self-employed folks have in their very fiber everything that demonstrates that depth of desire.

We say we want passive income but we are not afraid of doing hard work.

We say we want passive income but we don’t shy away from showing up, even after countless “failures”.

We say we want passive income but we are full of ideas on how to change things and make things better.

We say we want passive income but we are saying yes to requests from others so we can be of help.

We say we want passive income but we can’t stop thinking about our business even while on vacation if we take one in the first place.

I could go on.

What we want, what we really really want

So, it’s not passive income that we may be looking for, it seems.

Could it be that what we really really want is:

1. the freedom of doing what we love;

2. doing the work when we want it, with whom we want;

3. the satisfaction of having a meaningful impact on people’s lives;

4. the joy of creative expression, of learning, of following our curiosity;

5. the possibility of having no income ceiling;

6. leaving a wealthy financial legacy for our loved ones;

7. and making a difference for the causes close to our hearts?

Or when we say we want passive income, what we simply want is:

an asynchronous way of working where we don’t have to show up at a certain hour we can work whenever we want whether it’s 2 am or 2 pm, in between baby naps; we can go for a lunch break with a friend to take advantage of a sunny afternoon and then be able to work after 9 pm to get the thing done; a truly remote work so we can work from wherever we want; a work environment where goals and objectives are communicated in written or via recorded video; and where meetings and video calls are no longer a must.

On that last point, Sahil Lavingia, the founder of Gumroad has created a no meeting, no deadline, no full-time employees business model and is thriving.

So what is it for me?

Well, what I truly want is the freedom to do the work I love, remotely and asynchronously (no appointments and take breaks when I need or want), be creative and collaborate with those I want to collab with, be my own boss (rapid decision making is a plus), have income/profit ceiling that breaks through the societal gender inequality, have the revenue growth that I desire for my company and wealth for my family while making a difference for our audience and the causes I care about.

And oh, none of it needs to be passive. However, I would love a leveraged business model.

Perhaps, it would be worthwhile to re-evaluate what we mean when we say Passive Income. Is it code for the true desire for work freedom that we want as solopreneurs and content creators? If so, let each one of us decode it for ourselves so that we can create the life we really really want!

Sources:

Houston, Melissa. “There Is Nothing Passive About Passive Income .” Forbes, 17 December 2023, https://www.forbes.com/sites/melissahouston/2023/12/17/there-is-nothing-passive-about-passive-income/?sh=2054bd391a45 Retrieved March 13th, 2024.

Cole, Nicolas. “There Is Nothing Passive About “Passive Income”.” Medium, 14 January 2021, https://nicolascole77.medium.com/there-is-nothing-passive-about-passive-income-79e25032ce30 Retrieved March 13th, 2024.

Roepe, Lisa Rabasca. “What’s Passive Income? It’s Not What Influencers Say It Is.” New York Times, 27 January 2023, https://www.nytimes.com/2023/01/27/business/passive-income-job-retirement.html Retrieved March 13th, 2024.

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