there's no such thing as passive income

Let’s clear something up today: Passive income is a myth.

Well, kind of.

I have seen a post on threads the other day about passive income and while i use this term loosely sometimes and you've probably seen some headlines like:

💸 "Make money while you sleep!"
🌴 "Earn passive income and quit your job!"
📲 "Set it and forget it!"

The truth is, all income requires effort—somewhere, somehow, from someone.

Even the most “passive” forms of income need upfront work, time, or money to get going. And often, they require ongoing attention too.

Let me explain...

What People Think Passive Income Means:

💼 Start a business → autopilot → profit
📚 Write an e-book → royalties forever
🏘️ Buy a rental property → mailbox money
📈 Invest in stocks → instant millionaire

But in reality?

• A business takes strategy, marketing, and customer service.

• An e-book needs promotion (or it disappears into the internet void).

• A rental property needs maintenance, tenant management, and risk management. (this is why i have my husband deal with our real estate lol)

• Investing takes time, education, and emotional control.

None of these are “hands-off.” They’re just leverage.
And leverage is powerful—but it’s not magic.

So What Is Close to Passive Income?

If your goal is to earn money with minimal effort over time, here are two of the most realistic forms of near-passive income: 

1. High-Yield Savings Accounts (HYSA) - 

If you keep your money in a traditional bank account, you're actually losing money value due to inflation.  Putting it in high yield savings account is better and it's essentially just like a bank account that provides higher than usual interest. 

In a HYSA, you can access you cash anytime, there's no maintenance and very little risk (you are not really investing your money) 

But let’s be honest—it’s low-yield.
You might earn 4–5% annually, which won’t build wealth on its own, but it’s perfect for short-term goals or emergency funds.

The bank i use for my HYSA is Ally Bank and Capital One savings.

2. Dividend-Paying Stocks

These are companies that pay you a portion of their profits, just for holding their stock. You  get paid with "Dividends" 

✅ Paid regularly (quarterly, sometimes monthly)
✅ Can be reinvested to grow your portfolio
✅ Typically more “passive” than rental income

But remember:

• You need to invest a decent amount to see significant income.

• The stock market fluctuates. Long-term mindset required.

• Research and education still matter. Also, money you gain from dividends is taxable depending on which account you have it invested in. 

Bottom Line?

Passive income isn’t about doing nothing—it’s about doing the right things once, so you don’t have to do them forever. It's setting up foundations so you don't have to keep on doing active labor/ active income.

You might not get rich overnight, but you can build streams of income that support your freedom, one smart step at a time.

—
Quick Action Step:
👉 If you haven’t yet, move your emergency fund to a high-yield savings account. It’s a 5-minute move that pays off every month.

This week's quote:“how lucky I am to be uncertain about my future because my options are plentiful”. 

little quick life update: going through a big transtion in my career right now and Im scared af. I wrote about it in my substack if you're interested to read about my personal life, thoughts, musings! Read here

Have a great week ahead, Ellaine