Passive Vs. Active Income

Passive vs. Active Income: A Guide to Wealth Building with VisionBank

At VisionBank, we’re committed to helping you understand and optimize your income streams to achieve long-term financial success. When it comes to wealth building, it’s essential to know the difference between active income and passive income—and how private wealth banking can help you leverage both for your financial goals.

What is Active Income?

Active income is earned through direct efforts and requires ongoing involvement. This includes:

• Salaries or Wages: Income earned from employment.

• Bonuses or Commissions: Rewards tied to performance or sales achievements.

• Self-Employment Income: Revenue from owning and operating a business.

Active income typically requires you to trade your time and expertise for money. While it’s often a reliable source of cash flow, it depends on your continued effort.

What is Passive Income?

Passive income is money earned with minimal day-to-day involvement, often from investments or assets. Examples include:

• Investment Income: Dividends, interest, or capital gains from stocks, bonds, and mutual funds.

• Real Estate: Rental income from properties or profits from real estate investments.

• Business Investments: Income generated from partnerships or businesses where you’re not actively involved.

• Royalties: Payments from intellectual property like books, music, or patents.

Passive income allows your money to work for you, making it a vital component of long-term wealth creation.

Balancing Active and Passive Income for Wealth Building

A successful financial strategy often involves a balance between active and passive income:

• Active Income: Provides a steady foundation and funds for investments.

• Passive Income: Builds wealth over time, helping you achieve financial independence.

Private wealth banking helps you transition from relying solely on active income to growing and diversifying your passive income streams, creating a sustainable financial future.


Achieve Financial Freedom with VisionBank

Whether you’re building active income through your career or creating passive income streams to secure your future, VisionBank’s private wealth banking team is here to guide you.

Let’s work together to create a financial plan that balances your current efforts with your future goals. Contact us today to start your journey toward sustainable wealth.