There are two types of income you can have (according to the IRS). That's active (or earned) income or passive (unearned) income. The difference is in how you get it and how it's taxed.
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How To Make Money In Retirement
Active income is money you exchange your labor for. I do that on a part-time basis.
The easiest way to supplement your retirement income is to simply keep working either full or part-time. Assuming you're physically and mentally able to keep working. Being mentally able is very important. If you're not happy with your retirement job or you don't like what you're doing, it may have an adverse effect on your physical health.
Active or earned income can be done almost immediately, but passive income takes time to generate and usually takes some investment upfront.
Everybody knows how to make an active income. You work for it and get paid for your labor. That's what a lot of retirees, including me, do either on a full or part-time basis. I actually worked part-time for about ten years in the same profession I retired from.
What I want to touch on is passive income. You have to put in some work to get it started but once the money starts coming in, you may have to do very little except maintenance to keep it going.
If you are willing to put in some research, learning time, and money, NOTHING BEATS PASSIVE INCOME.
How To Make Passive Income?
Passive income is that which you don't exchange your labor for. This could include investments, residual income, affiliate income, or rental income.
Passive income always takes a while to get started. As I mentioned, getting into this type of income stream depends a lot on how quickly you need extra money. I've listed four sources of passive income and there are probably many more, but these can give you something to think about.
Investment Income: People who have been invested in the stock market, either directly or through mutual funds, have made a ton of money since November 2016.
Investing in the stock market probably has the most financial risk involved done carefully, it can be the most lucrative. There are tons of information that might be useful to help make an informed decision about investing.
Personally, I would start by learning how to invest and then start with a small amount of money that I could lose and not worry about. It might be beneficial to do some mock stock market traders to learn how the process works.
Affiliate Marketing: Building an online business takes a long time. Every overnight success story you hear about comes after months or years of research, study, and hard work. But if you have an idea for a service or product that can be done online it might be worth the effort to pursue. Think about Angie's list, eBay or Facebook.
Affiliate marketing requires the ability and knowledge to develop a website and content that fits the There are many online merchants from amazon that offer affiliate programs. Do a search for a niche, products, or services that you would consider.
Rental Income: If you have enough money to buy some rental units, this may be the best way to supplement your retirement income and leave a legacy for your family. Do some research into multi-family housing, apartments, or commercial properties and see what's available in your area. I know one guy who took equity out of his home to buy a rental unit. It worked for him, but it's an idea that might not be for everybody.
Don't jump into being a landlord without studying how to be a landlord. There's a lot more to it than just buying a property and renting it out. There are government regulations to comply with and tax regulations that have to be considered.
If you decide to be a landlord, do a search for information on buying and owning rental units. Get a spreadsheet to plug in some numbers and see how specific properties will provide income. Learn the tenant/landlord laws in your area and get the advice of a real estate professional that you trust.
