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Passive income as we all know, is the holy grail of income generation, but it doesn’t come easy as genuine opportunities are very few.
These days, so many scams are galore, particularly online passive investment scams of which many of which are modern-day Ponzi opportunities in disguise.
I’ve also been rug-pulled and scammed a couple of times so I’ve learned a few lessons that cost me big time!
With that said, here are 6 key things I look at when I come across a new passive income opportunity and research into as part of my due diligence.
- Who are the owners and management behind it, what is their history, track record etc?
- How are they generating their main income? What are they selling, and buying, is there any proof of trading?
- What is their business structure? Do they have a registered company, real office, staff, contact numbers, and customer service?
- Are they guaranteeing profit returns? if they are, then that’s a big red flag, because no company should guarantee income
- Is the estimated return on investment worth it, relative to the capital invested?
- Is there transparency in their business operations, ie the owner’s identity, the business operations, keeping customers updated etc?
I may also add some more checklist points, but these are the main key criteria I look for before getting into a passive income opportunity.
There’s still no guarantee that an opportunity will be 100% genuine, satisfactory and last, but at least by checking these things, it should minimise the chance of investing in opportunities that turn out to be “bad apples”!