Passive income is a tool used by many investors to increase their personal wealth. Through the process of locking your funds up to passively generate an income, there are a number of products on the market. As we outline the what, when and how’s of the endeavour below, you can get an idea of whether this is in line with your current financial situation.
Sure investing in property, cryptocurrencies and the stock market can be rewarding, but what about allowing your assets to bring in additional streams of income? Similar to a rental property or building bringing in additional income, you can allow your digital assets to do the same.
Passive Income At Various Life Stages
While earning passive income through cryptocurrencies can be a lucrative venture, it is not necessarily a good option for everybody. As we move through certain periods of our lives there are times to be more risk-averse and times to be more risk-seeking. Below we outline various life stages and highlight how passive income could be better suited to various stages.
Studying
In your twenties, you are usually exploring the options and deciding where to focus your energy in terms of career, cities, love life, etc. This time generally doesn't allow for plenty of disposable income and earning passive income might be the last thing on your mind.
With Tap's earn program you can start investing as little as £1 /€1 (with no maximum limit). There are no fees, no lockup time and users receive weekly payouts on the interest earned. The more capital you have the more pocket money you could make. Whether you're in sales or marketing, or anything else for that matter, don't underestimate the power of passive income.
Working And Earning
Once you enter the working world and settle into a job there's little time and energy to spend on chasing alternative income sources, which makes passive income a great option. With tiny minimum deposits required and entirely automated earnings, Tap's earn function once again ticks the boxes when it comes to earning interest on your cash or crypto. Service your salary and add capital to your earn wallet allow your capital to grow (also keep an eye out for our automated investments coming soon).
Earning And Saving
Once you get into the swing of earning and saving decent money, you might want to consider options that allow that money to grow a little faster. Earning interest on your savings and crypto holdings allows you to not only protect your funds from inflation but also accelerate your earning potential. While Tap's Earn program allows for both fiat and crypto earnings, it also promises aup to 7% APY (traditional banks and companies generally offer between 0.1% and 0.65% yearly interests).
Already Holding Crypto Assets
If you've already been involved in the world of investing in cryptocurrencies, this is the perfect way in which to maximise your profits. Instead of leaving your funds idly sitting in your wallet, store them in an earning account where you can generate interest which is paid out weekly and can be reinvested. With no lockups and no withdrawal limits, you're free to use the funds when and as you please.
Before You Embrace Passive Income, Consider These Red Flags
While earning passive income is a great way to make money, it is also a long term game and is therefore not the optimal option for everybody. Consider these red flags below, illustrating when engaging in passive income programs is not advised.
- Debt with high-interest rates
Economics 101 tells us to pay off debts before engaging in alternative financial avenues. Be cautious of high-interest rates and rather pay off the debt before using the funds elsewhere, as with any investment there are always risks involved.
- Negative cashflow
As passive income requires risk and capital, investing while you are experiencing a negative cash flow is not advised. Consider rectifying this issue before engaging in investment opportunities. Consider the investment rule: never risk more than you're willing to lose. The same goes for buying any asset as the prices fluctuate due to supply and demand.
- Short timeline
Passive income is not a "get rich quick" scheme, instead, it should be considered to be a long term investment opportunity. The longer the funds remain, the higher the returns on your portfolio.
While the Tap Earn program is effortless, we strongly recommend that you analyse your financial situation and ensure that this is a calculated and responsible decision.
How To Earn Passive Income
Now that we've covered the "when", let's get into "how" to go about it. With Tap's Earn program we've made it pretty simple. Follow these easy steps and you'll be in the game in no time:
- Create a Tap account
You will need to have an active Tap account which means that you will need to have completed the identity verification process. You can download the Tap app here (iOS and Android compatible).
- Under assets, select earnings
- Add funds in order to start
We require a minimum value of £1 /€1 to start, which can be in any of the supported cryptocurrencies or fiat currencies on the platform. These funds can be removed from the Earning wallet at any time. Through the app, you can also buy a range of cryptocurrencies at the best available market prices.
- Interest paid out every Monday
We're going to make you love Mondays! Every week the interest earned on your funds will be paid into your account. Think of it as making royalties on your investment.
Let Your Funds Do The Work
Before you decide to make use of passive income opportunities, consider all the other varying factors surrounding the investment, such as your financial goals, timeline, risk tolerance, asset cost, financial responsibilities, etc. Once you are ready to take the plunge, simply log into your Tap account and get started!
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