Passive income is income (money) you earn while not actually doing any work for it. The idea is you use money to earn you money and it is probably the best way to earn money as you can do something else while you money works for you.
The simplest example of this is if you put a lump of money in a high interest bank account. You interest you earn (the income) is paid to you but you did not work for it. Well other than opening the saving account.
Of course even savings account need some looking after, once every little while you need to make sure you have the best account for you money.
So in reality passive income means you earn money by doing only a little amount of work after the initial set up period.
Passive income is good for a number of reasons. It feels a lot like free money as you don't work for it - everyone loves free money. It also has the advantage that passive incomes scale well. If you are looking after a large lump of money saved in banks it takes about the same amount of work/time as looking after a smaller amount.
Finally building up passive incomes is something you can do in your spare time while holding down a day job. The idea here being you use a portion of the money you earn from you day job to create passive incomes. Over time you passive income will become larger and larger, particularly is you reinvest your passive income to create more.
In the next article in the series I will look at traditional forms of passive income.
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