Quarterly Passive Income Report: Q1 2018
Dearest readers, passive income is the holy grail of all income as its receipt is entirely independent of your effort level. This means if you choose to spend the next three months learning a completely new craft or working on your aesthetics, you’ll still be receiving income whether or not you choose to work. If you decide to take a couple of months off to travel, you won’t struggle with bills on your return. Sounds like a dream and almost like a scam but this is exactly the dream I’m currently in the process of realising.
There are 4 recognised ways of building your passive income empire:
- Stocks & Shares
- Peer-to-peer Lending
- Real Estate
- Online Side Hustle (OSH) – learn more about OSHs from this book and this one. Or get one of the books free in audiobook format by signing to their free trial.
Hard working people like us in the UK are taxed very heavily and therefore I choose to completely avoid real estate investing, at least until I retire. Let me demonstrate – if I had a monthly rental income of £500, 42% of this (£210) immediately goes to the government before mortgage interest, repairs and real estate agent fees eat into the rest. We also have to bear in mind stamp duty, surveyor and solicitor fees when you first buy the property.
If you don’t have a full time job and can fully enjoy the tax-free personal allowance then real estate investing is a great option. Otherwise you’re probably forgoing at least one year’s in rental income as a “startup cost”.
Individual savings accounts (ISAs) allows the sheltering of stocks and shares, and P2P lending investments and this is where I’m heavily focused.
I admit to having invested next to zero effort on my passive income over the past year and yet the snowball effect can readily be seen. The past year has seen a more-than-45% increase in passive income and if I want to see the same rate of progress I’ll have to start putting in some work.
Q1 2017 – £794.49
Q1 2018 – £1,169.34
+ £374.85 (+ 47.2%)
As with everything worthwhile, initial effort is required to create passive income but this effect lasts for many years and decades, and in theory should require little maintenance.
| Income | Expenses | Total | |
|---|---|---|---|
| P2P Lending Side Hustle January | £25.91 £105.57 | - £44.34 | £25.91 £61.23 |
| P2P Lending Side Hustle February | £19.99 £165.36 | - £69.45 | £19.99 £95.91 |
| P2P Lending Dividends Side Hustle March | £515.59 £419.30 £111.04 | - £32.99 £46.64 | £515.59 £386.31 £64.40 |
| Q1 2018 Total | £1,169.34 |
If you’re interested in pursuing FIRE and enjoyed this post, don’t forget to drop me a line below and I’ll respond to every one. I learnt everything I know about personal finance by reading this book, this book, this book and this one. You can get one of these books in FREE audiobook format using this link. Simply sign up to a 30-day free trial and if you don’t enjoy the service you can cancel any time free of charge at the click of button, and still keep your book.
Great blog. I have lots that I want to / need to achieve in the next couple of months – pass paces (2nd attempt, nearing end of CT2, pressures on), get a couple more summative procedures, tick all the other ARCP boxes, pursue FIRE, there’s just not enough time….
Hi Albert,
Thanks for reaching out – CMT can be pretty grim, especially for personality A types like us but August isn’t too far away. Unless you have an inheritance then FIRE is a dream that’s very far away, and can be safely stowed in the background.
As you’re doing, if I was in your situation I would “forget” about FIRE for now so obviously no locum shifts and no researching investments. Concentrate on smashing PACES. If you need central lines and chest drains, literally just visit MHDU & the respiratory unit every day and show your face. For ARCP, I topped up most of the top and other presentations with learning modules two days before deadline…
Good luck and let me know how you get on
R
Thanks Rory!
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