Here is your weekly dose of financial wisdom. This edition is focused on strategies to generate passive income beyond investing in financial markets.
Productize Your Experience
It’s no secret that passive income is the key to financial freedom. In addition to investing, a smart way to generate passive income is to create products.
Build skills: formal or self-education, mentoring, doing projects etc.
Gather experience: learn by doing, explore what interests you.
Provide a service: use your skills and experience to help others.
Get results: collect tangible proof that your service is helpful.
Productize your service: provide a set offering at a fixed price.
Build a product following the ‘build once, benefit forever’ logic: a good product has zero cost of replication.
This framework can be simplified into the so-called ladders of wealth creation.
When climbing the ladders, remember:
To build wealth, apply your existing skills in new ways.
Building wealth is different from working for a better wage.
It takes longer than you think but the results can be incredible.
Each step is easier with an audience.
Credit: Nathan Barry
Sell Your Sawdust
Take people behind-the-scenes and continuously sell your sawdust. As you shape your craft, show your process: share what you have learned, what works, what doesn't work.
Escape competition through authenticity.
Imagine if the people you look up to would have documented their entire journeys starting from zero. What an incredible source of value that would be!
Consistently generating and sharing proof of work builds your reputation. Showing how you solve a specific problem proves that you have the answer.
The beauty of this idea is that most of us have the material, we just don’t share it. All you need to do is work in public.
If you’re a student, show how you learn.
If you’re a gardener, show how you maintain your garden.
If you’re an athlete, show how you train.
If you like to sing, show your singing practices.
If you like to read, show your reading notes.
Where to show it? Nowadays there is an abundance of resources: social media, blog, video, newsletter, podcast…
Credit: Jack Butcher
Bringing these two ideas together:
Build something you can sell forever.
Make content that sells it.