3 Passive Income Streams Millions From Reliance On Retirement

  • I want to retire early as a millionaire, knowing that I will need passive income to support myself.
  • Financial planners say that their multi-millionaire clients often get income from rental properties.
  • They also use Social Security strategically, investing in businesses that provide cash flow.

As someone who didn’t take retirement planning seriously until I turned 30, I found myself playing catch-up. Not only do I contribute to my SEP IRA on a monthly basis, but I am also always looking for additional ways to build

net value

So I can retire early as a millionaire.

If I can achieve this goal, I want to make sure that when I retire, I have passive income to support my lifestyle and cover my bills. In an effort to find out how retired millionaires make money without working full time, I asked financial advisors to share how their clients earn passive income. Here are the three most popular methods.

1. Rental and investment properties

There are a lot of perks that come with owning an investment property. That’s why financial planner Darren Colani says it’s one of the most common passive income streams among millionaires.

Colani says that having homes that are rented throughout the year, or most of the year, can not only get you a steady stream of income, but it can also have tax advantages.

“You can take a rental income tax deduction by depreciating the property,” which means deducting the cost of buying a property or improving its rentalAnd Colani says. You can also use any expenses (including the mortgage, utilities, regular repairs, etc.) to help offset your rental property income by deducting this from your personal tax liability. “This means that a portion of the income comes to you tax-free as you continue to build equity in the property,” he says.

2. Social Security, they are collected strategically

The passive income stream that most American workers receive when they retire, Social Security, is one that millionaires also rely on, according to financial planner Scott Sturgeon. He says that although Social Security is a common source of income, there is generally a strategy to follow when a person starts taking cash.

“Social Security planning can get surprisingly complex,” says Sturgeon. “For my clients, I perform various analyzes to determine the optimal time to start these payments based on their specific financial situation.”

While you can start receiving your Social Security retirement benefits at age 62, if you wait to receive payments until you reach age 70, the amount you receive will increase. It won’t help me if I retire in early timebut I can count on him later in life.

3. Business investment

Even when his millionaire clients stop working full-time and retire, financial advisor Brian C. notes that they still participate in the business as investors.

See says clients invest in the business in many different ways, from investing in start-ups to providing the company with an injection of capital.

“Investing in these businesses gives you ownership in a company with access to equity, profit sharing, or the opportunity to sell the business for

capital gains

at a possible future date,”

Leave a Comment