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Investments in rental properties may also seem attractive at first. However, ongoing costs, property management fees, repairs, and taxes come into play, revealing that such investments are not truly passive. Simpson warns against gurus promoting the idea of completely passive income streams, particularly in areas like YouTube, where maintaining channel performance requires active management.
The Reality of Income Streams
Simpson emphasizes two critical points regarding passive income. First, the capital required to yield meaningful returns is often astronomical for the average person. Second, even the most promising passive income streams come with caveats: market fluctuations can alter returns, and higher yields frequently correspond to increased risks.