How To Spend Passive Income

How To Spend Passive Income

Everything you read is about how to get passive income. In this article, I want to focus on how to spend passive income.

At a certain point, all the hard work you have put into creating passive income needs to make some enjoyment out of life. If you work and save and invest, you may lose interest if you don’t reward yourself. There is a simple rule to live by, and it will go against what many financial advisors will tell you. Once you are not in crisis mode on your need for money, you should spend 20% of your passive income on enjoying life, and the other 80% reinvested to grow more passive income.

How To Spend Passive Income

Crisis Mode

Cris mode is where you have no choice on how to spend passive income. 100 % of your passive income must go toward getting you out of crisis mode. Crisis mode could be things like you are behind on rent or car payments or don’t have enough to eat. You can’t take 20% and take a long weekend or buy those new shoes you have wanted.

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When you are successfully paying all your bills regularly, you are out of crisis mode. Of course, routinely paid bills paid doesn’t mean you are debt-free, but you deserve to have a life, and this is where the 20% comes in. You can use it for something that makes you happy.

Examples Of How To Spend Passive Income

Depending on how much your passive income is will determine what kinds of splurges you can afford. If you are making $5000, passive income monthly will look much different than $1000 monthly. Below is a list of the TOP 5 Splurges1


Travel is the one thing I want to spend extra money doing. For me, the passive income lifestyle is all about vacations with the family and the closeness it creates. It is the best time I can have to be with my daughter, son in law and Grandkids. So if your income is not enough to pay for a vacation, maybe you have to make a weekend getaway or save for several months to make it happen. I have a goal of eight holidays per year, but it starts with one.

Food/Eating Out

Eating out is another favorite of mine. Going to a nice restaurant with family is a delightful experience. Couple this with travel, and you have some unique memories created.


Buying things around the home to make life more comfortable or more enjoyable is always a fun expenditure. For example, I recently purchased a new alarm clock that projects the time on the ceiling.

Best twenty bucks I ever spent.


I’m not too fond of wine, but many people are, and this is one of the top 5 for millionaire splurges, but you don’t have to be a millionaire to enjoy a good wine. Just ask Gary Vaynerchuk.


Feeling good about yourself can be boosted by dressing well. Buying a new outfit can keep you positive while building your empire.


There are many other ways to spend your extra money, and the point is to be happy along the journey, so feel free to treat yourself along the way, and you will live a full life. None of us know how much time we have, so enjoy what you have.

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