The Basics of Income and Earner : Active and Passive

Types of Income and Earner

• There are two types of income: The Active Income and the Passive Income.
• Likewise, there are two types of earner: The Active Earner and the Passive Earner

So, what is Active Income?

• Active Income is earned from ACTIVITY performed.
• Income earned is proportional to the time spent.
• Typically, we work for over 40 hours per week for more than 40 years.
• Retirement comes after over 20 years of working

So, who is an Active Earner?

Active Earners earn their income directly from the activities they performed such as rendering or offering of products or services.

Who among the money-makers belong to Active Income and Active Earner types? 

Those in the Groups 1 and 2 Money-Makers:

• SWP – Salaried/Waged People
• SMEP – Small or Medium Entrepreneur or Proprietor

Active Earners work for money.

Groups 1 and 2 are where 90% of the people earn 10% of the wealth.

And, what is Passive Income?

• Passive Income is earned from development or acquisition of income-generating Investments or Assets.
• Income earned is on-going and independent of time.
• Retirement comes as a natural consequence of on-going passive income not time.

Who is a Passive Earner? 

Passive Earners earn their income from the assets or investments they acquired or developed and/or on-going passive income they built.

Who among the money-makers belong to Passive Income and Passive Earner types?

Those in the Groups 3 and 4 Money-Makers:

• BTI – Big Time Industrialist
• CI – Capitalist and Investor

Passive Earners’ money works for them.

Groups 3 and 4 are where 10% of the people earn 90% of the wealth.

Four Groups of Money-Makers: Group 4 Capitalist and Investors

Group 4 Capitalists and Investors

They are the following:
Capitalist
Investor
Financier
Sponsor
Backer

Capitalists and Investors (CI) are those money-makers who commit their money in order to earn a financial return.

Sila ay mga namumuhunan o kapitalista. Karaniwan, ang mga kinita nilang pera ay ipinupuhunan sa mga negosyo o mga stocks, investment securities, bonds o mga katulad nito.

Four Groups of Money-Makers: Group 3 Big Time Industrialist

Group 3 Big-Time Industrialist

They are the following:
Big Time Employers
Business Owners
Business Tycoon
Business Magnate
Industrial Corporators
Major Stockholders of Corporations
Owners of Group-of-Companies

Big-Time Industrialists (BTI) are those money makers who own big businesses. Normally, they are the owner of the so-called Group-of-Companies or they are the major stock-holders of big corporations. They employ salaried/waged people.

Sila ang tinatawag na “Malalaking Negosyante.”

Four Groups of Money-Makers: Group 2 Small or Medium Entrepreneur or Proprietor

Group 2 Small or Medium Entrepreneur or Proprietor

They are the following:

• Self-Employed
• Sole Proprietor
• Freelancer
• Profession Practitioner

Small or Medium Entrepreneur or Proprietors (SMEP) are those money makers who work for their selves or work-on-their-own. They exchange their services or products for service or professional fees paid by their clients or patients and/or payment of their buyers or customers.

Sila ay nagtatrabaho sa sarili nila. Sila ang may-ari ng sarili nilang negosyo (sole proprietor) o mga propesyonal na nagtayo ng sarili nilang kumpanya (self-employed, profession practitioner) o mga indibidwal o propesyonal na independent (freelancer).

Four Groups of Money-Makers: Group 1 Salaried or Waged People

Group 1 Salaried or Waged People

They are the following:

• Employee (Empleyado)
• Laborer/Worker (Manggagawa)

Salaried or Waged People (SWP) are those money-makers who work for someone else. And they come from different educational background or social status. They exchange their services for salaries and/or wages.

Mga Taong Swelduhan
Sila ang mga taong namamasukan para kumita ng pera.
Karaniwan, sila ay ang mga nakapagtapos at hindi nakapagtapos ng pag-aaral. Sila ay sineswelduhan kapalit ng kanilang serbisyo.

Four Groups of Money-Makers

There are four groups of money-makers and they are following:

• Group 1 Salaried or Waged People
• Group 2 Small or Medium Entrepreneur or Proprietor
• Group 3 Big Time Industrialist
• Group 4 Capitalist and Investor