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Would You Rather Have One-Time or Passive Income?

I love my fellow personal finance bloggers and I think many have some really brilliant ideas, but the one that has annoyed me most recently is the idea that passive income is the ultimate goal of the personal finance community.

For some people, it’s a great goal. If you have enough money, you can invest and set your finances on auto-pilot and never work again. The only problem is that you must be very wealthy to earn a lot from passive investing, so most bloggers aren’t talking about this route.

Rather, they’re talking about setting up small online businesses that bring in small amounts of money each month. If they can set up 10 websites to earn $100 each, that’s $1,000/month in extra income. Sounds great, right?

The problem with this thinking is that it’s rarely easy to earn $100/month and it takes a lot of time and effort just to get there. There is also a lot a lot of maintenance that goes into a website. I know that even when I was making about $4/month from blogging I was spending several hours a day trying to build the site and my online reputation.

I’m a fan of dreaming big, I have no problem with people setting goals, even if they’re unrealistic. However, I think people have taken the idea of passive income too far. It’s a great goal, but why aim for passive income online when you can cash out and take a big lump sum now?

The problem with passive income online is that nothing lasts forever. You may have a sweet website that gets a lot of hits, but if you’re not maintaining it, it will eventually get less traffic and earn you less money when someone else decides to challenge you for a specific search term.

A lot of people aren’t opposed to selling advertising space on their site or taking some private advertising opportunities, but when they think about it, they don’t want to risk stifling their site and being banned by Google. Um, you’re making $50/month now, why not grab an easy $5,000 and hope for the best? Even more, you can use a factoring service like CBAC Funding LLC that does all the work for you so you can focus on what you do best: making money. While some sites get banned after a short gain, many more have earned 5 figures knowing that if and when the ride comes to the end, they’ll have done pretty well for themselves.

Why try to earn $100/month forever (or however long a website brings in cash for) when you can take $5,000 right now? Doesn’t it seem like a no-brainer? It would take 50 months (over 4 years!) just to break even, and who knows, maybe there will be enough private advertising opportunities to make $10,000, $20,000 or more over the same time period?

Readers, do personal finance bloggers have an unhealthy obsessions with creating passive income? Are they missing the big picture?



  1. My choice is still another, I like multiple streams of income because of some of what you said. I already have a nice nest egg that is growing and will provide income in retirement. I want more income streams to supplement my income.

  2. YES, I want the one-time income. I want someone to come say, hey, your URL and website are worth $X to me.

  3. Somehow, I feel like I am guilty of dreaming unrealistically. ;) I agree with your line of thinking, but don’t think it has to be one or the other. Ideally, with staff writers, one could still earn decent income with only a small amount of time invested. That’s what I tell myself at least.

  4. I think that people need to be realistic. If they can grow their site to be one of the best there is a big payout at the end. If they’re just shooting for middle of the road sites to squeak by a few hundred a month maybe they’d be better of selling.

  5. I’ve never really thought about it that way, but you are right on. I had an old website that I used a lot of private advertising for… and now, it’s not worth much, but I made a few thousand dollars off of it over the course of some time (during which I was in college, so the money felt like even more!)… can’t say I regret going that route, that’s for sure.

  6. I’m not sure why bloggers continuously refer to their sites as passive income. It’s anything but passive income. Unless you are in the “1%” of high traffic, very popular blogs, you are most likely spending at least 10 hours a week maintaining the site and generating new content. And then to get excited about even $1000/month in income is not all that impressive considering it breaks down to under $20/hour or less after taxes and site costs. While it is income, it is hard work and hardly passive.

  7. If your hours put in vs net income ratio continues to be favorable, you are onto something. If this becomes stagnant, you’ve created a job for yourself. If it becomes unfavorable, you need to stop or look at why this is happening. I ended up giving up independence for a job that tripled my income working for someone else. It would have taken me too long and too many hours trying to raise income independently. You give up some things for this, but you also gain in other ways and allows me to work towards greater goals.

  8. I’m not a finance blogger but I reckon the answer depends on the current circumstance of the person in question. If it’s a need to go onetime income, they go for it. If not, they hesitate. Personally, passive income is a better route for me.

  9. It’s not really passive, you’re right. But if you think of sites like a business model, put the initial work in, and hire staff writers like someone mentioned above, it would not be impossible to manage. You would still be actively managing though – it would be a full-time thing.

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