Thought I’d make a video of it, but I’m feeling a little under the weather.
So I decided to blog about it while the thought is still fresh in my mind.
Something I do regularly is blog about my passive income.
It is a digital record of not only the numbers but also my thoughts at these different points in time.
Of course, blog posts are also meant to inspire readers.
Hopefully, more regular people like me would make investing for income part of their journey to financial freedom.
Yes, if AK can do it, so can you.
While I was having a conversation with some friends recently, they asked me how I continued to grow my passive income when I had no earned income for the past 8 years?
One of them reminded me how my annual passive income was closer to $100,000 more than 10 years ago.
Now, it’s over $200,000.
It’s not something I’ve given much thought to.
So what did I say?
“I’m very frugal when it comes to money which allows me to continue to invest more money even though I have no earned income.”
When I left the workforce, the biggest downside was losing that income.
While still receiving an earned income, I was able to reinvest all of my passive income and some of my income as well.
Retirement has definitely slowed the pace of wealth building.
A friend told me that being able to continue to grow my wealth even in retirement is pretty impressive.
(Most people see their wealth decline in retirement.)
How did I achieve this?
In a nutshell, that’s the beauty of investing for income.
I consume the income generated by my investment portfolio.
I don’t consume my investment portfolio.
I don’t eat the chicken but the eggs that the chicken lays.
However, this is not the full story.
Remember how my friends did CSI on my passive income and reminded me that my annual passive income was closer to $100,000 more than 10 years ago?
Wasn’t $100,000 a year already enough to ANSWER someone like me?
Well, it was probably more than enough.
So what was the problem?
I am worried.
Hard to change.
I needed a buffer and a significant one too.
How important is the buffer?
Well, consider this.
Even today, with inflation as high as it is, I recently blogged about how I would be very comfortable on $48,000 a year.
See how important the buffer is?
If I had retired more than 10 years ago instead of 8 years ago, I would have a smaller buffer.
If I had spent money more freely, the behavior probably would have carried over into my retirement years.
I could not continue to build my wealth to what it is today.
For most of us, it is much easier to limit the outflow than to increase the inflow of wealth.
So it’s not just don’t eat the chicken but the eggs.
It is also having more than one chicken or having a buffer.
Don’t consume all the eggs so we can sell some of the eggs to buy more chickens.
Of course, there were times when buyers offered much higher prices for my chickens.
I used the proceeds to buy even more chickens.
Not all chickens thrive, but most of them do.
So how did AK the early retiree grow his passive income from $100,000 a year to $200,000 a year?
No income but can still grow passive income?
Confirm and double confirm!
If AK can do it, so can you!
Related post:
Inflation, passive income and budgeting.
