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  • Translator: Queenie Lee Reviewer: Denise RQ

  • The average person in the UK has only 11 weeks income saved in the bank.

  • How much do you have saved?

  • How long could you live for if your paycheck stopped coming in?

  • Maybe you've never thought of that,

  • and it might be a little bit scary to think about.

  • Today, I'm going to share with you about passive income,

  • and how to design your dream life through building up your passive income's dreams.

  • Designing your dream life through passive income,

  • that's a big claim.

  • Wish me luck!

  • Why is passive income important to us?

  • And what is it?

  • In October 2012, I knew absolutely nothing about passive income.

  • I was here, it's like you've said, I was at B Block, Derwent uni,

  • and I knew nothing about passive income.

  • I knew how to make income.

  • I knew that you go and swap your time for money,

  • that's called active income or earned income.

  • It's what you do when you get a job, and that's what 99% of us in the world do.

  • The opposite of that is passive income, or recurring income.

  • It's where you do the work once,

  • and you continue to get paid recurrently for very little or no actual work.

  • When your passive income, the recurring income,

  • exceeds your cost of living

  • what you spend on food, utilities, petrol, all that kind of stuff

  • when your passive income exceeds your cost of living,

  • then you were financially free.

  • If you happen to lose a job or not get a paycheck,

  • you can live infinitely forever.

  • Now, why is that important? So this is a question, get ready for it.

  • Let's have some audience participation.

  • Can you think of reasons why your paycheck would stop coming in?

  • You break a leg. Perfect!

  • So you're sick, or you're incapacitated, you're unable to swap your time for money.

  • Thank you.

  • Anybody else?

  • You get fired? Fantastic, perfect! Has anyone been fired in the room?

  • (Laughter)

  • Perfect!

  • Anybody else got any other ones? Yeah.

  • Awesome, that's a really good point.

  • So your industry changes;

  • that could be a global financial crisis, or it could be modernization.

  • Things like that Lehman Brothers collapse,

  • or the mining industry, or steel;

  • structural changes that can affect us.

  • That might have nothing to do with your competency at your job.

  • You might also be taken over by a new firm.

  • There's a merger, and there are two of you at the same job.

  • And you're made redundant.

  • Or maybe you just fall out of your boss, and he asked you to trot along your way.

  • It may not actually be due to your competency whatsoever.

  • That's not a great position to be in, is it?

  • If your financial security is effectively based on circumstance,

  • or things that might be out of your control.

  • So when I was at uni,

  • I just finished my second year, I got a first, which was great, in PPE.

  • And I tried...

  • I took a few years to get to uni

  • I tried banking - I tried Citigroup in Canary Wharf

  • I tried accountancy, I tried law, I tried sales, IT sales, PR

  • then I've tried Procter & Gamble.

  • I had this long list of proper jobs

  • of what I thought respectable people go and do these things.

  • I tried working with children.

  • And I really enjoyed it, I didn't dislike the jobs.

  • I liked the people I was working with,

  • so if you're watching, please, don't think I didn't.

  • But it didn't light me up.

  • I couldn't see myself spending the next 45 to 50 years,

  • so what is the retirement age now?

  • Is it 65 or 67?

  • What happens when we get to that age now?

  • 75, 80, 100? Who knows!

  • I couldn't spend the next 50 years of my life doing this thing.

  • I remember Procter & Gamble,

  • they said to me on my final day, in Hornbeam Park, Harrogate.

  • They said, "We want to offer you a job when you finish uni,

  • but we're not quite sure if it's right for you."

  • And I thought, "Well ...," you know, I didn't know how to take that.

  • They said, "Just pop out the room.

  • We'll bring in the other boss, and we'll have a chat."

  • When I came back in there I was smiling.

  • They were like, "What are you doing smiling?

  • You know, we sort of saying we don't really want to offer you the job."

  • I said, "No one has ever said that to me."

  • I thought it in my head.

  • I thought I can't do this, but I didn't know there was an alternative.

  • It took someone else to say it to me,

  • to say, "You know what? They're right. I can't do this."

  • So, as scary as that was,

  • it's like I'd shut that door, and now it was like, "Well,

  • let's start something from fresh, what can I do?"

  • So I went home that night and started googling,

  • as any self-respecting person does when they're faced with a life crisis:

  • they jump on Google.

  • I started discovering terms like, 'how can you be your own boss, '

  • 'passive income', 'wealth creation, ' and words I've never come across before.

  • I started to read, and I've read about real life case studies,

  • not billionaires or these incredibly talented people

  • but normal people who had picked a strategy,

  • there are lots of ways of bringing in passive income.

  • I chose property, but there are a lot.

  • They said about taking work, that's taking action.

  • Is it get-rich-quick overnight? No.

  • If anybody tells you it is,

  • the only way of doing that is the lottery, alright?

  • But it can't be get rich fast

  • whatever that is for you: months, years, it doesn't take long.

  • Continual sustained action can get you the results you want.

  • So I read loads of books, I thought: "Great."

  • They asked me, "A master like in uni?" I was like, "I'm reading other stuff."

  • I went along to these...

  • I chose property, it resonates with me,

  • but as I said, you don't have to pick property.

  • I went along to these events where I met normal people.

  • I remember a guy called Trevor - a normal guy came across property

  • Boom! He had 30 or 60 other houses, whatever it was,

  • and I was like, "Well, if he can do it, I can do it, too."

  • So I spent my student loan, and I took out a credit card.

  • I invested in myself to learn what to do; I invested myself.

  • To cut a long story short, I started with no money.

  • I had no knowledge or education in this kind of stuff.

  • Two years later,

  • I had paid off every investor I borrowed from, own 24 houses,

  • with the portfolio worth 3.5 million quid,

  • and I won a few national awards.

  • That doesn't mean I'm special at all.

  • I think the biggest thing I want to get across is anyone can do it,

  • it's a strategy.

  • If someone happens to get a degree,

  • it doesn't mean they're an absolute legend.

  • They've just done what they've been told.

  • They've rocked up to the classes, done the homework and got the result,

  • whether it happens to be the first or 21 or 22, you get a degree.

  • And it's the same with wealth creation stuff.

  • Some people are blessed with natural ability,

  • and that might get them there a little bit quicker.

  • But anyone can achieve the same results.

  • The reason I wanted to get into this stuff

  • was because I didn't like through I was heading down.

  • Unfortunately, for people in the UK,

  • 60 to 70% of people don't like their job;

  • 60 to 70% of people don't like their job.

  • And of that, a third of them hate their job.

  • So out of 100 people, whatever it is in this room,

  • 25 people hate their job; but you don't have a choice.

  • If you don't know anything different,

  • you have to go and swap your time for money.

  • You've got bills, you've got a mortgage, you've got to look after the children,

  • you don't have an option.

  • Often, we work so hard in the day, that we're knocked at the end of the day,

  • or we don't have the headspace to start thinking about other things.

  • I didn't want to be in that position.

  • The further you are down the line...

  • For you, students out there:

  • this is the perfect time to take action - now.

  • You've got the time to really check this stuff out

  • because I found that the older people get,

  • they tend to maybe have a few more limiting beliefs or barriers.

  • Everyone has the same ability.

  • In fact, older people have more ability, because they have more life experience,

  • but there might be other commitments there

  • that block them in their brain from doing it.

  • That's the hardest thing need to overcome, is your limiting beliefs in your head.

  • Passive income from property is one way, but you can choose network marketing,

  • like Forever Living or Utility Warehouse - that kind of stuff.

  • You start to sell, you then build up a team of people selling for you,

  • and eventually, they're all making money for you;

  • you're not doing any work,

  • You've got affiliate marketing where you drive traffic to websites

  • and you make commission off all the purchases.

  • What else have we got?

  • Owning a business:

  • if you're not working in a business, you're not self-employed.

  • if you are, you are not really a business owner

  • because you're still swapping your time for money like a plumber

  • unless they've got a firm, where they oversee it,

  • and people are running out doing the work for them.

  • You're still swapping your time for money.

  • You've got Amazon where you can set up a business

  • where you buy products in China and sell them over here.

  • Obviously, make commission on that; property is another one there.

  • There are loads of different ways of you generating passive income.

  • The other thing I want to say

  • is those of you who've got money in the bank,

  • or those of you not in the room who are watching further down the journey,

  • often, we're so busy focused on earning the money,

  • we're not focused on what to do with it.

  • Albert Einstein calls

  • the compounding effect the eighth wonder of the world.

  • A little bit of action, if you're young,

  • a little bit of sensible investment or making that money work a lot,

  • had a few adds up to something really special over time.

  • That doesn't need to be risky, or it's going to end in tears.

  • If you're smart,

  • you can make that money work really, really hard for you.

  • That's not just coming and investing with me, or...

  • No, there are loads of ways of doing that.

  • In terms of the how-tos,

  • I'm not going to talk today massively about all the ways you can do it.

  • I'll put my blog up, sign up to that,

  • and I can send you more about the how-tos and what's right for you

  • based on your income, or where you're at, or the time you have.

  • But the main thing I want to get across to you

  • is what happens if you don't focus on building up passive income.

  • Your predictable future is where you are right now.

  • If you're a student then you're probably eying up a job in the future,

  • or if you got a job at the moment - that's not going to change.

  • That's not a problem at all, not a problem at all.

  • But you may want something different. Do you want to be working for ...?

  • If you love your job, that's awesome. Keep doing what you do.

  • That's fantastic! You love it.

  • And you're very much in the minority of doing it.

  • But have the security, the peace of mind, and the freedom

  • that if your desires change, or if your circumstances change,

  • then you don't have to do that job anymore.

  • If it is not there, you don't have to worry.

  • So if you are sick, ill, if you get fired,

  • if your job changes, or your industry collapses;

  • there's not a problem.

  • Or if you want to look after a sick relative.

  • What happens if you do get your passive income?

  • Now, probably some of you in the room are thinking a fancy car, a big house,

  • all the material... A fancy logo on your shirt.

  • And that stuff is cool, right? It's fun, and it's great.

  • For some people, that means more than others.

  • I think the biggest thing for me

  • is to ask what would you do with your life if money was no object?

  • If you didn't have to swap your time for money,

  • what would you do?

  • Would you travel?

  • Would you go and learn to surf in Hawaii or do yoga in India?

  • Or go and help an orphanage in Cambodia?

  • What would you do? What are you passionate about?

  • That's maybe not something we ask ourselves a lot

  • because we don't see a way to achieve that.