A New Passive Income
Yesterday we created a new passive income. Woot! Woot! The ball is really rolling now. I’m excited in this endeavor. This investment if everything go’s well will bring in $500 per month in extra income on our original $50,000 investment. Generating a 12% return, will bring in above and beyond the difference in monthly payments of our refinance. This investment itself will surpass our goal for the year to bring in $2000 passive income in 2017.
I guess I got to dream bigger, I thought the goal of quadrupling our passive income of last year (just over $500) was a big one. This investment will bring in $2500 during 2017, and will just be reinvested in some type of investment. Therefore increasing the snowball, the future sure does look bright! If only I can quadruple it every year.
My wife’s family is pretty successful with their various en devours and in the past I have said no to investing with them. Looking back I wish I had as it has worked out pretty well for them. After telling them about the site I was approached again and was reminded how cheap money is at the moment. Refinancing our mortgage and pulling out some equity ( like we did) can make a massive difference in your income.
I have read Robert Kiyosaki’s books (rich dad poor dad series) awhile back and was hardcore about being debt free. I didn’t believe in using other peoples money. But as I have been investing in dividends for awhile now, it makes sense if you invest with great dividend payers that have a track record of paying consecutively. Ie enbridge. While my bank charges me 2.5% on my mortgage Enbridge will pay me 4.9% on my investment.
While this private investment isn’t Enbridge it’s got a history of doing well. Its basically for family only so, I can’t get ya in haha.
Oh course there is risk involved that’s why we decided on a initial investment of 50k vs a higher amount. We both trust the people that are running the company, but we wanted to feel this out and see how it go’s. Currently our investment in locked up for 5 years, which should be fine. We will have to pay taxes on the income. Wah Wah…
I am hooked to increasing our income streams at the moment. We now have 5 different incomes
- My Working Income
- My Wife’s Working Income
- Ads/ Affliates (currently really minor)
- This Private Investment
So this investment should pay out every month, which will bring in $2500 this year, and our dividends currently will pay 2300+ yearly. This is a massive gain over last year, and just keeps going. We actually are meeting with our solar panel guys this Sunday to look over our roof and officially apply to hydro one for the microfit program! Its pretty exciting stuff. Again thanks everyone for keeping me motivated, your blogs inspire me to keep on keeping on! What do you think? 2 more incomes to get to the elusive 7 incomes the average millionaire has.
Hey I’m Rob, creator of Passive Canadian Income.
In 2011 me and my wife had almost $60,000 in debt and a negative $7,000 Net Worth. Through hard work and financial education we paid all that off. Now we are focusing on increasing our Passive Income Streams to make the money work for us. Feel Free to Follow along the Journey by clicking the Social Media links below or subscribing to get notified of new posts on the sidebar.
Very nicely done, well done to you. Picking up another investment is fantastic. Well done to you!
I’m also obsessed with increasing my various sources of income-day job, dividends, online income, and I’ve now recently started with Lending Loop. Check them out-high risk, but also interest rates in the 10%+ range.
Hey ken sounds you got some nice streams. I’ve been watching some ppl’ s peer to peer lending. I’m curious buy looks like your average return declines over the long-term since aloy of people don’t pay the loan. Will continue watching!
Happy to see you keep making more passive income streams. At a pretty quick rate too I might add. The more you can do now, the better off you will be in the future. Looking forward to seeing how the solar panels work out too. Thanks for sharing.
Thx daze it’s the refinance. Or else it would still be slow pace =)
With a 12% return, this is a great addition to your passive income stream. Just have a question for you. How tax efficient is this form of income? It’s awesome to make such a great return, it would suck if a large percentage of the income goes to he CRA.
Without getting to into it it’s tax deferred kinda like a reit! But yeah there will be taxes there always is….
That’s exciting PCI. Diversification is usually a good thing, but especially great when diversifying your sources of passive income. I hope it works out well for you and looking forward to seeing how it goes.
Thx div, me too. I agree another source is always great.
It’s always good to diversify. I like your goal …five independent sources of passive income. I have only one at this point … dividends.
My second, sometime in the future would be renting …
Lets see what else I can add … Good job with your new source of income.
Thanks geek. I got a buddy with a couple rentals. He’s does pretty good! Best of luck
On the new investment with a 12% return, that is awesome. On a scale of 1 to 10 (1 being low risk, 10 being high), how risky is this investment?
I’m a born sceptic, so please be patient with me.
If the family business is doing so well, why would they need your $50k investment. Are they doing you a favour or the other way round?
Do you have a legalized contractual agreement?
Are you locked in or can you exit the investment at any time or only after a certain period?
Since its ‘family’ style private investment, what is your recourse should the dividends stop coming in?
Good questions John. I would say it’s risk is 6 or 7. I would think we are both doing a favour. They tend to enjoy using other people’s money vs their own and are probably highly leveraged. (May not be a good thing)
We have a legal contract that says I’m locked in for 5 years. ( verbally we have said since we are family we could get out sooner if need be but of course I wouldn’t want to unless unforeseen stuff happens. The family recourse has not been decided obviously let’s hope for the best. Of course bad things can happen but they own a lot of assets so hopefully it wouldn’t come to that.
will you put that $500/mth into your RRSP’s or TFSA to further invest in dividend growth stocks?
Oh for sure. Right to the rrsp got to get more us companies
Can you say much about this investment? Is it with friends, family, etc. Roughly what business are they in?
It’s a family deal. Mostly in real estate. Apartments foreclosures etc
Well congrats on the investment. I love the cloud of mystery and I have started to learn more about it through reading the comments. It sounds like it is a real estate venture with a certain element of risk to it. However, I guess the increased risk is why you are getting a higher return, right? Best of luck in the venture and I hope it is everything you want it to be (and more).
Haha the cloud of mystery. Yeah real estate. It has some risks but I don’t think it’s crazy risky
Is your family the Madoff family? Because if 12% sounds too good to be true and if it is to good to be true then it always is! Get out while you can. You have been warned.
I hear ya Robert but if you cant trust family who can ya trust?
Some MICs (Mortgage backed securities) pay 7-9% depending on risk (not including the leveraged ones which could achieve greater returns (but with more risk)