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Look, even Wikipedia admits it!
Passive income is a type of unearned income that is acquired with little to no labor to earn or maintain.
"I work very hard as a landlord"
"I am a leech on society"
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this post was submitted on 11 Jul 2024
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chapotraphouse
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You choose to ignore the key point of the comment. I also listed apps/games. Technically, I may choose not to maintain the API. It might not remain relevant or profitable for very long, but I can just ignore it.
Besides, being a landlord also requires constant maintenance. It's just that the income is arguably disproportionate to the work done.
Wow damn that's crazy it's almost like it requires constant effort and is a job unlike owning a property deed and failing to hire a contractor when my AC breaks down again.
Regardless of your views on whether or not landlords deserve their income, it's irrelevant to the point I'm making. The are other ways of having a passive income besides being a landlord; ways that are arguably "earned".
Then it's not clearly not passive income, "passive income" is definitionally simply reaping where one has not sown. If you're doing work it's not passive income, it's a job. Software Dev work is not so easy.
No it's not. It's "definitionally" income that's passive, i.e. you're not actively doing anything for it (any more). In other words, you can put a some or a lot of work in advance and then receive income over time, passively. A short list of examples:
As a software dev I know what it entails. It can be your job AND your passive income.
But that's the key difference: you actually are doing labor to maintain it, and you did all the labor of creating it in the first place. It's not passive in the way you're making it out to be, especially in contrast to income earned simply from owning assets and extracting interest or rent from it.
You just have a skewed definition of "passive income". All passive income implies at least some* ammount of work in advance. Yes, even "being a landlord" passive income requires you to do some work in advance, depending on the circumstances. You need to save enough capital to purchase a property, then make it rentable and find tenants. Is it a lot of work? Depends on the landlord, but some is required.
As if most landlords do that themselves.
Idk. All of my "landlords" did it themselves. But I've never lived in the US.
But again, it's not my point. See my other comments for the explanation.
Let's say I spend two years carefully hand-crafting 10,000 widgets, then decide not to make any more. I sell those widgets for $100 each, but will only sell one per day. Is the money I'm getting from widget sales passive income on your definition?
You say it like my definition is the weird and unconventional one. The term literally says "passive" income. The conventional definition is "you did something once and profit from it over time without putting any or very little effort".
In case of your weird and unnatural example, if the sale process is automated, and you can go do other work in the meantime or just sit in an arm chair and sip beer while watching TV, then yes, it's passive income.
Your example also implies that you had some other income to sustain you while you were working on these widgets and you shifted the income from what could've been active income to be passive income later.
In other words, you invested into these widgets and are now receiving dividends.
What I'm trying to tease out here is whether or not you think that passive income just means income for labor that is temporally separated from payment, which it seems like you do. That seems like not a particularly useful category of cases to talk about, at least to me. I don't really think there's much point in arguing about the "standard" definition, because it's a buzzword, not a precisely defined technical term.
The complaints on this thread are mostly treating "passive income" as a synonym for "rent seeking" (which is a rigorously defined technical term). Your definition includes things that aren't rent seeking, and just involve getting paid in the future for labor you did today. Again, I'm not saying your definition is wrong (because there's no precise definition to be wrong about), but it's talking past the other criticisms on this thread.