A quick Google search of “passive income” will leave you with a litany of tips, tricks, hacks, lists, guides and “weird ways” to generate passive income while working, on vacation, awake or even asleep.
The proliferation of “side-hustles” has moved into the mainstream as many Americans struggle with stagnant wages and crippling student debt. As a result, many have sought to generate a second income stream, which has complicated the true meaning of passive income.
We believe that generating passive income can not only help create long term wealth but also help provide an intermediate supplementary income stream.
At Yieldstreet, our investments are designed to generate passive income for investors. This means that after you initially invest, you will have funds, in the form of interest and or principal, flowing back into your account on a regular basis.
How often are you receiving payments that aren’t your paycheck?
This is drastically different from how stocks work. Unless you are investing in a dividend paying stock, you will not see any funds flow back to you unless you sell the stock or the company is acquired (outside of a special one-time dividend).
Put simply: time and utility. Many investors want to have recurring cash flow from their investments that they can either use to reinvest, save or spend. Additionally, because of the short-term nature of our offerings (typically 12-36 months) investors know roughly when to expect to get their principal back.
Generating passive income can help provide flexibility and freedom. It removes the tough and potentially tax inefficient decision of when to sell a stock. This should allow investors a certain peace of mind when investing on Yieldstreet.
We like to think about passive income as the opposite of active income – you are not actively working or participating in the accumulation of this second income stream on a daily, or even weekly basis. Earning passive income means relieving the continual need to buy, sell, or perform prolonged research for an investment after the purchase.
That does not mean investors should not thoroughly read and diligence investments before investing, however, after that initial period of research (and determination that an investment is right for you) the ‘active’ work ends.
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Investing is often thought of as a time capsule – something you bury away and don’t touch until you need money it for retirement or to pay for college. We believe these benefits are so distant and intangible that it can feel onerous to save or invest because you can’t feel or see anything coming back to you.
But when your portfolio generates a steady passive income stream and funds come back to you on a regular basis – that feeling of tangibility returns and its benefits sprout to life.
Generating passive income through one’s investment portfolio can intermediate the two general needs of investing – creating more wealth and saving for the future. By having income flow back to you on an intermediate basis, you can use the funds intermediately to either spend now or reinvest towards the future.
Yieldstreet provides access to alternative investments previously reserved only for institutions and the ultra-wealthy. Our mission is to help millions of people generate $3 billion of income outside the traditional public markets by 2025. We are committed to making financial products more inclusive by creating a modern investment portfolio.