Passive Income is a type of income that does not need to work in theory, because the money or the work done in the short term makes money for you. Types of passive income are varied: rent, royalties, deposits, investments and even money lent to acquaintances or someone else. $ 1,000 a month in Latvia would be high enough because they are well above the average wage level. Such money can be earned on active income by working on a highly qualified or professional qualification. Can such a regular amount of money be earned through passive income? The answer is yes, but the type of passive income and the amount of money that circulates at this source of income are very important. So the differences are in the form of passive income sources.
The first could be the rental options
Earning 1000 dollars a month with renting could be a very difficult task. If it is just one property, it must definitely be very valuable, but most likely it would be used by the owner himself or the customers would be wealthy to buy their own home. Thus, the more realistic option is for a landlord to own several apartments or other types of living space. Then the income would come from several tenants and could make up to 1000 dollars per month. Only this could be considered as a partially active job, as these living quarters must also be managed and depreciated over time.
The next type of passive income is royalties
This income can be obtained, for example, from a written book. If it is actively purchased by people who want to read this work, it is possible to earn money by writing books. Only book sales will never be stable, as this product will no longer be up to date and the writer may have to work on a new job. Depending on sales, $ 1,000 is a real income option. But here is the problem of the irregularity and quantity of income. This would certainly not be the safest option for passive income.
A savings deposit is much safer
This deposit is the transfer of money to the deposit account and the receipt of income from the interest calculated from the size of the investment. The more money you invest, the higher your earnings. The interest rate is usually around 3-5%, which is obviously not very much. Taking into account the average interest rate of 4%, you can calculate how much money you would need to invest to get $ 1,000 a month. Such an interest rate would require $ 25 thousand. Such money is not pocketed by any consumer and it is not easy to earn that amount of money. However, if you are satisfied with this amount of income, this is the most reliable and stable source of passive income.
Another source of passive income is investment
Investments pay around 5-10%. In terms of profit, this is a much more beneficial source of passive income for the deposit, but the investment also has a risk factor. Namely, the value of the company’s shares may fall and the money you invest is lost because these shares will no longer be sold at a sufficiently high price. The best option would be to invest money in stable and large companies with financial stability. Such investments would definitely pay off in the long run. The amount of money you invest depends on the investor, but to make the money really pay off and earn as much as $ 1,000 a month, you need a very large amount of money – at least $ 10,000.