Passive income, the dream of being paid without lifting a finger, sounds too good to be true?
In some ways it is and in some ways it isn’t.
Let me explain.
There are plenty of misconceptions about passive income and how it can grow your private practice. Without understanding what these misconceptions are, you can easily be led down the wrong path and even the wrong passive income stream.
In this article, I’ll debunk the 4 common misconceptions about passive income.
4 Common Misconceptions About Passive Income
(1) Passive income is easy money.
One of the biggest misconceptions is that passive income is easy money.
Many entrepreneurs start adding passive income streams inside of their businesses because they believe that it’s the magic beans of revenue generation.
But the truth is generating passive income takes hard work, dedication, and a lot of upfront effort. Passive income doesn’t usually yield immediate results and often takes weeks, months and some cases even years to start seeing the desired earning potential.
Passive income is delayed gratification at its finest.
But when you work on your passive income stream, you are building something and if you stick with it, one day you’ll have a stream of income that you spend less and less time on and still make income.
Let me give you a personal example:
One of my more lucrative (and favourite) passive income stream is writing blogs, like this one.
When I first started writing blogs, I never thought in a million years that my blogs would become a passive income stream. I just wanted to share helpful tips and strategies that I know will help therapists and coaches start growing their practice now – not when they can afford my (or anyone else) services.
So, I posted my first blog post on May 7, 2021 and within the first year of starting my blog I made $3847 from passive income – and this doesn’t include one-to-one clients I received from those who read my blogs. But honestly, most of that income was in the second half of the year – the first 6 months I didn’t make any income but I kept contributing to my blog anyway.
This article is the 38th post since I started but my first blog post is still my highest performing and I have new views on it every single day. As I continue to build my blog with new content, my older posts continue to bring in new readers and passive income.
So moral to the story is, whether you’re creating a digital product, starting a blog, or setting up a recurring revenue stream, it’s important to be prepared for the work that goes into making it happen – and stick to it!
You need to continually work on growing and expanding your income streams to keep money coming in.
(2) Passive income is one-size-fits-all approach
Another misconception is that passive income is a one-size-fits-all approach.
There’s no such thing as a the ‘perfect’ passive income stream because each person has their own purpose for doing what they do and are intrinsically motivated by different activities and tasks.
So, the next time you fall into the pesky comparison trap and start comparing yourself to a colleague that might be hustling with a particular passive income stream, remember a passive income stream that’s the perfect fit for them, might not be a fit for you.
Honestly, the best predictor for passive income success is whether or not you enjoy building your passive income and are intrinsically motivated to continue to grow it (even during the hard times).
Let me bring this back to my example above:
When I started my blog, my purpose was to share helpful business building strategies – not to make money – and because I absolutely love to sit behind my computer, in pajamas, and write, it fit who I am as a person. My purpose and personality was aligned and I was (and still am) intrinsically motivated to keep contributing to my blog. However, if you asked me to put out regular video blogs (or vlogs), I wouldn’t be as inclined to contribute regularly because that means I’d actually have to get dressed in the morning.
So, despite all of the shiny objects out there, find a passive income that aligns with your purpose and personality and that’s intrinsically motivating for you so you keep building it – even if you don’t see immediate results.
(3) Passive income is the only way to achieve financial freedom in private practice
Some people believe that passive income is the only way to achieve financial freedom in private practice.
While passive income can be a great addition to your financial strategy, it’s not the only way.
It’s important to have a well-rounded financial plan that includes passive income but also considers other income streams, such as traditional fee-for-service or earned income options.
According to Bourne & Rosenmerkel (n.d.), a study conducted by using IRS tax filings, millionaires, like the rest of us, have earned income such as wages and salaries but they also have other income streams, including passive income, added to their financial portfolio.
So, don’t worry, you do not have to give up one-to-one services unless you want to.
(4) Passive income is only for those who have an existing practice or business.
Finally, some believe that unless they quit their job and open a traditional one-to-one service private practice, they cannot have passive income streams.
This is simply not true.
As long as your purpose and personality align with the passive income stream you want to build and you are intrinsically motivated to keep building it, you can build a business with only passive income streams while you continue to work in your 9-to-5 job and you never have to start a traditional one-to-one service-based practice.
Possibilities for Successful Passive Income Generation in Private Practice
Ready to see passive income in action?
Here are some examples of successful passive income generation in private practice.
First, the social worker who created a suite of online courses teaching stress management techniques to corporate executives. By leveraging their expertise and reaching a wider audience, they’ve been able to generate a steady stream of passive income for their practice.
Next, the life coach who wrote a bestselling book on the power of positive thinking and since turned their book into a range of products, including ebooks, audiobooks, and even a webinar series, generating passive income for their practice without having to continuously trade time for money.
Finally, the therapist who started a private online support group for individuals who have social anxiety. Not only do they provide a valuable service to their clients, but she’s also able to generate recurring revenue through membership fees.
By tapping into your expertise and finding innovative ways to reach your ideal prospective clients, you can create additional income streams and achieve financial freedom while doing what you love to do – helping others.
Why Passive Income is a Must-Have for Therapists and Coaches
Passive income is a game-changer for therapists and coaches seeking financial freedom in their private practices. From the ability to reach a wider audience and generate recurring revenue to the freedom to work on your terms, passive income offers many benefits.
However, it’s important to remember that passive income is not a one-size-fits-all solution. Every private practice is unique, and it’s up to each therapist and coach to determine the best passive income strategy for their business.
So, if you’re ready to take control of your finances and achieve financial freedom, start exploring the world of passive income today. The possibilities are endless, from online courses and bestselling books to private support groups and beyond.
Don’t know where to start?
Take our free Passive Income Personality Quiz below to learn which passive income stream best aligns with your personality type.