Another fantastic year in the history books, but there is no time to look backward. 2025 will be a time to celebrate our amazing passive income dreams as we achieve them.
2024 was my first year of full retirement, and it went splendidly well. Were there bumps in the road? Of course. However, there was nothing that money and cash flow couldn’t solve.
In 2025, I aim to achieve two goals: increase my net worth and passive income by 10% apiece. Will this be difficult to achieve? Perhaps. But I can do it in style. Let’s begin.
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Increasing net worth by 10%. I want to increase my net worth (not including real estate) by 10% in 2025. I don’t want to include real estate because I cannot control valuations.
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Instead, I want to focus on things I can influence, such as high-yield savings, treasury bonds, cryptocurrencies, and dividend stocks.
If 2025 is an excellent year for the stock market, meeting my goals will be extremely easy. If not, then I will have to put in some serious work to overcome a depressed market.
Looking at the numbers, I’ll start 2025 with $363,412 in paper assets. To reach $399,753, I need to add $36,341 to my accounts.
I assume 2025 will be a flat year for the stock market, perhaps a 5% return from the S&P 500 (SPY), Dow Jones Index (DIA), and the Nasdaq (QQQ).
Therefore, I must focus on bringing fresh capital into my accounts. My primary plans are to reinvest dividends and attend college.
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While attending college, the VA will pay me $1,833/month, which I will invest directly in dividend stocks and closed-end funds.
I also will put all the income from my book business and roommate into savings and investing. Finally, I will invest the rental income from our two rental properties into our brokerage accounts.
If things look depressing, I’ll consider trading options to generate additional revenue. Currently, I do not see the need to take any risks, as we should easily hit our numbers.
However, you never know what tomorrow will bring, so it’s good to have a plan. I would love to start generating income from our tiny home, but that would require some capital expenditure (upfront costs) before it becomes viable.
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Increasing passive income by 10%. It looks like our net worth will be easy to achieve (famous last words), so let’s focus on passive income.
For passive income, I will focus solely on dividend income because it is the only one I can control. I cannot control rent prices and the amount of books I sell.
If I were trying to become a real estate mogul, I would purchase more properties to drive up my rental income. But that’s not me.
If I were trying to be a well-known entrepreneur, I would double and triple down on my book business to drive up business income. But that’s not me.
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Instead, I want to focus on being a husband and father. I enjoy my time the way it is, so my version of passive income is from dividends.
Looking over the dividend numbers from November 2024, we made $2,110 in income. December 2024 will bring in $2,200, so we roll with that number.
That means I need to increase my dividends by $220/month to reach $2,400. At an 8% yield, I need to add $33,000, which aligns with our net worth goals.
I can reach the dividend goals using the same financial tactics I use to build my net worth: roommates, college, books, reinvested dividends, and rent.
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Reaching your 2025 passive income goals. Enough about me; how do you plan to reach your passive income goals? Let’s start with defining passive income.
Passive income is any money you generate without directly exchanging time for money. For example, if I write a book, I can later generate $3 in passive income.
My book could sell one copy ($3) or 100 copies ($300), but I spent the same amount of time and work once—that’s the magic of passive income.
It is time to start the process if you have never made $100 of passive income. Let’s review how to make $100 in passive income during 2025.
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High-yield savings accounts pay roughly 4.2% in annual interest. You must save $2,381 to receive $100 in annual interest payments.
30-year Treasury Bonds yield about 4.5%, which you can lock in for 30 years. You would need to invest $2,222 to receive $100 in annual interest payments.
Dividend growth stocks, like McDonald’s (MCD), yield about 3%; however, their share price also grows along with the markets. This is different from bonds that stay flat if you hold until maturity. You would need to invest $3,333 to receive $100. But your $3,333 would grow as well.
Closed-end funds, like the PIMCO Dynamic Fund (PDI), can yield 12%; however, their share price is highly volatile because it fluctuates with fixed-income prices. You would need to invest $833 to receive $100 in annual dividend income.
Trading options can be a great way to build your accounts quickly if you have the temperament for this strategy. Trading long strangles would require an account of about $200 to generate $100 in annual options income.
Writing books can help you create royalty income from thin air. I made $502 in book royalties on Amazon in my first year, so it is possible to earn $100.
Renting rooms is an amazing option for most people who own their homes or have landlords who let them sublet a room. You can make $500+ just by renting a room for one month.
There are too many ways to earn passive income to count. Some require considerable upfront investment (high-yield savings), while others offer more risk for more reward (options trading).
You can even earn more from thin air by using your creative abilities. Whatever you choose for 2025, set a goal and stick to it.
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Conclusion. I first heard of “passive income” in 2019, when I was 38. I felt cheated that hard work and climbing the ladder were not as valuable as I had made them.
I dream of increasing my net worth and passive income every year without a job. In January 2024, my net worth was $292,525, and I finished 2024 at $363,412—a 22% increase. I achieved this growth without holding a job.
In January 2024, my dividend income was $1,352, and I finished 2024 at $2,200—a 49% increase. I achieved this growth without holding a job.
I plan to keep increasing my stats until the end. I will teach my kids and grandkids about these methodologies.
The rich continue to get richer because their assets produce increasing income that they use to purchase more assets. It’s an incredible financial cycle once you get a hold of some assets.
Everyone can purchase $5 in McDonald’s stock on Cash App; no more excuses exist. Let 2025 be the year that you start earning money in your sleep. Good Luck!
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Disclosure: I am not a financial advisor or money manager, and any knowledge is given as guidance and not direct actionable investment advice. I am an Amazon Affiliate. Please research any investment vehicles that are being considered. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article. All Right Reserved Military Family Investing
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