AN EMPIRICAL STUDY OF TRANSITION STRATEGIES FROM EARNED INCOME TO PASSIVE INCOME FOR ACHIEVING FINANCIAL INDEPENDENCE

Abstract

Financial independence has become one of the most important goals in modern personal finance. In recent years, many individuals have sought alternatives to lifelong dependence on salaries and wages due to job insecurity, inflation, rising living costs, and dissatisfaction with traditional employment structures. Passive income has emerged as a popular solution because it can generate recurring cash flow after an initial investment of money, time, or effort. However, the idea of passive income is often misunderstood. Many people assume that passive income means effortless money, but in reality, most passive income streams require significant upfront work, knowledge, and risk. Examples include dividend investments, rental properties, intellectual property royalties, digital products, online courses, affiliate marketing, and automated businesses. These streams may eventually become less labor-intensive, but they often begin as active projects.