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Ask HN: What was your best passive income in 2016?

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Re: Ask HN: What was your best passive income in 2016?

#351

Post by shostack »

jrheard wrote: post #335
closeparen wrote: post #306

Earlier quoted context omitted.

... otherwise known as a 401k. Probably don't do this (use taxable investment accounts) unless you have at least 15% going to your tax-advantaged retirement account(s).

Good point, I forgot to mention that. I think that it's possible for a lot of young people in our industry to save significantly more than 15% of their income, and so I should have said: max out your contributions to retirement accounts every year and then set things up such that you're automatically saving as much of your remaining salary as is comfortable (e.g. if you're a recent college grad working in SF, and you…

I was on the "max out retirement accounts" train when I was younger. When I got older and home prices got massively inflated, I wished I kept more of that in non retirement accounts to be made more easily liquid for a home without steep penalties.

Saving tax while something grows is great, unless you need that cash sooner. Then it is not too helpful. I wish there were a tax advantaged vehicle to use for setting aside money for a home.

So yes, definitely invest in tax advantaged accounts, but do so with a solid understanding of your expected financial needs as best you can model for the next 5-10 years. If you need access to that money sooner, what you'd lose on tax may be worth the flexibility of having those investments somewhere more easily liquidated.

Re: Ask HN: What was your best passive income in 2016?

#352

Post by chei0iaV »

wordpressdev wrote: post #350
kohanz wrote: post #308

This was pretty accidental, but to motivate myself to complete the arduous application process for my professional engineering license, I creates a WordPress blog documenting the process. Also because I thought I would learn something new (setting up WP blog) and this seemed very "shippable". I completed the application process over the course of a year and haven't written a blog post in over a year. Thanks to a comp…

By changing ad placements, and adding a more ad units, you can increase your Adsense earnings significantly.

And add banners pleading to disable Adblock, right?

Re: Ask HN: What was your best passive income in 2016?

#353

Post by Rainymood »

hackerboos wrote: post #241
yonibot wrote: post #115

Earlier quoted context omitted.

This book taught me the fundamentals of passive investing ( https://www.amazon.com/Random-Walk-Down-Wall-Street/dp/03933... ) and this website is THE online community for Bogle-style, passive investors ( https://www.bogleheads.org/ ), once you understand the basics.

I read that book this year. The entire book can be summarised as. Don't attempt to beat the market. The market cannot be beat (many examples in the book). Invest in index funds long term which is the right mix of risk/reward for most people. It does have a chart in the back which tracks your age and situation. For example as you approach retirement you should start to liquidate your funds and buy government bonds so…

>The market cannot be beat.

I really would like to believe this, but please explain to me how then how firms like Renaissance can exist ... Not sure whether it's relevant but I'll add that I'm an economics PhD student.

Re: Ask HN: What was your best passive income in 2016?

#355

Post by shostack »

gottebp wrote: post #312

Breville coffee grinders are impossible to get internal parts for. I designed a 3D printed upgrade for the main wear-part in their BCG800XL SmartGrinder. The storefront is through ShapeWays[1] and I use ifixit[2] to drive the traffic. It's passively making ~$425/mo with about 10 minutes of work per week on my end. This all happened because my grinder failed and I couldn't get parts. [1] https://www.shapeways.com/prod…

What's the legality of that?

Re: Ask HN: What was your best passive income in 2016?

#356

Post by austenallred »

brookside wrote: post #342
austenallred wrote: post #11

I co-wrote a book on user acquisition and co-created an accompanying video course to climb out of debt left over from a failed startup. Made $104,000 in revenue since June (turns out the user acquisition stuff actually works), about 87k of which is profit, so we'll say ~$11,000/month part-time. It still makes me a solid $2,000/month now with zero work, and hopefully more once the book is officially published. (It's d…

Making money selling a book isn't proof that the content of the book contains good advice for making money.

Not directly, but the main method of driving revenue was giving away the first few chapters. We know almost exactly how many sales we'll drive based on how many people read those chapters.

Re: Ask HN: What was your best passive income in 2016?

#357

Post by fsloth »

logicallee wrote: post #192
fsloth wrote: post #142

Earlier quoted context omitted.

Some of us bring in value by developing existing software packages which amplify the work effort of some critical sector or another. The renumeration for this work is in the form of regular pay. A portion of which should probably be invested smartly. As software systems grow they turn into complex systems. They become embedded in the processes of the end users, while requiring constant boring work to remain alive. I…

"The remuneration[1] for this work is in the form of regular pay. A portion of which should probably be invested smartly." I guess my objection was to the idea of saving "as much as possible." I don't mean to imply that you shouldn't work for a salary: but you should take some of that salary and spend it on actively building or backing businesses, not just passively. Based on your background I think you would be amaz…

"you should take some of that salary and spend it on actively building or backing businesses, not just passively."

Active investment is highly context sensitive. I'm not denying someone might be plausibly in a position with sufficient information, domain knowledge, connections and a small amount of capital to operate as you suggested.

Your claim that operating on this manner is the obvious best choice for everyone is highly controversial. For starters, private investment requires trust and communication and just the culture barrier to understand the true rules of business and engagement are non-trivial for someone who's native culture is for example northern european.

Basically, I'm totally clueless. I have no idea how to a) hire an indian software dev for a few thousands b) what value added activity I should require of them and c) to whom to sell their work to.

I do know, however, how to invest into low cost index funds with reputable finance organizations. Thus the latter from economic perspective is a highly more enticing option.

I presume you have some specific situation in mind. Perhaps you could give some 'hypothetical' scenarios and what their profit model is?

Re: Ask HN: What was your best passive income in 2016?

#358

Post by chei0iaV »

Rainymood wrote: post #353
hackerboos wrote: post #241

Earlier quoted context omitted.

I read that book this year. The entire book can be summarised as. Don't attempt to beat the market. The market cannot be beat (many examples in the book). Invest in index funds long term which is the right mix of risk/reward for most people. It does have a chart in the back which tracks your age and situation. For example as you approach retirement you should start to liquidate your funds and buy government bonds so…

>The market cannot be beat. I really would like to believe this, but please explain to me how then how firms like Renaissance can exist ... Not sure whether it's relevant but I'll add that I'm an economics PhD student.

Two decades ago you might have asked how firms like Long-Term Capital Management can exist

https://upload.wikimedia.org/wikipedia/commons/e/ec/LTCM.png

Re: Ask HN: What was your best passive income in 2016?

#359

Post by shostack »

durkie wrote: post #294

i own a decent amount of tesla stock and 2016 was a great year for lending it out. since tesla is such a controversial company, lots of people want to own the stock (expecting it to go up) and lots of people want to short sell it (expecting it go down). if you're a stock holder, certain places (like interactive brokers) will let you lend your stock holdings to people that want to sell it short. you earn a premium on…

What would be a good starting place to learn more about doing this? Also, is it possible to do with a small amount of shares in individual companies if the bulk of my investments are in indexes?
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