You must have heard of passive income. It is the income you earn without directly working for it. It comes from different types of investments – be it high-yielding options or low-yielding ones. As a doctor, it is important to have a passive income source irrespective of what you earn currently. You may be established in your career or just starting out; it is important to think of generating passive income ASAP.
Here are 4 reasons to create passive income for physicians.
- Sense of Security:
Nothing screams financial security than a steady passive income stream! Passive income for physicians can be in the form of a high-yielding savings account, retirement savings account, equities, rental income, and real estate investments.
Whatever your preference; another income source, apart from your active income, can offer you a sense of security. Illnesses, personal life problems, loss of job, disabilities, or any other uncertainty life may throw at you; a passive income can act as a great support to tide you over your bad times.
Passive income that comes from pooled real estate investments are considerably risk-free. In such investments, you invest in a property along with other investors. So, you lower your risks and gain more without any stress. When you have an option to generate a second income without much risk, it will also offer you a sense of security.
- Retirement Fund and Lifestyle:
It is not possible to build a sizeable retirement fund by way of savings only. You need to start investing in order to build wealth. This additional income will help you prepare for your retirement. With assured passive income, you can begin to plan for the lifestyle you desire after your retirement.
The earlier you start investing; the better it is for your future. Irrespective of your current income, you can invest in pooled real estate investment options and create a passive income stream. You can start saving more and earn extra by way of interest.
A passive income can also help you fund your current lifestyle. It will allow you to travel without worrying, partake in hobbies, take a few days off here and there, or do anything you want with ease.
- Wealth Building:
Passive income for physicians can help with wealth-building. You cannot build wealth on the basis of a single income. It is the passive income that helps you accumulate funds and that too in a stress-free manner.
You can continue to invest your surplus passive income and enjoy capital gains. Any surplus is a chance to invest more. You can invest in real estate for greater yield on your investments. You can opt for extra rental income by buying properties – individually or with a group of investors.
A passive income that comes from real estate investing can yield higher returns and help you actually accumulate funds for a secure future. With a single income, wealth-building is difficult.
Once you generate sufficient wealth, it will help you build more of it.
- Financial Freedom:
Financial freedom is important. You may desire it at any point in your life. The life of doctors is full of stress. Most physicians work a great many hours every week; especially those starting out in their careers. Even many established physicians put in crazy hours most weeks.
Imagine this lifestyle for years down the line and for one source of income! You can, however, utilize your savings to start earning a passive income and give yourself (and your family) the gift of financial freedom.
A passive income will enable you to cut down on your working hours. You can spend it with your family or on doing some leisure activity. A passive income will allow you to live a life of ease.
One income, that too uncertain, can be like a knife hanging on your head. It’s a constant threat. What if you lose your job when your hospital decided to downsize? What if you suffered an injury and have to take a long break from work? Imagine any scenario here and it will make the importance of a passive income for physicians clear.