Popularized by social media, passive income refers to a self-sustaining source of income that a person isn’t actively involved in beyond initial maintenance. A quick search on these platforms will find an overabundance of videos from influencers claiming they effortlessly make thousands of dollars a week — and so can any viewer by simply pursuing passive income. Passive income is excessively promoted online, promoting hustle culture while also preying on consumers and harming business owners alike.
Influencers suggesting that financial security is only a few small steps away by simply starting a side hustle normalize the idea that free time should constantly be spent on making money, placing the blame of financial instability on individuals. It presents the notion of passive income being easy and effortless to pursue, pressuring people to attempt to achieve unattainable sources of money. Not only that, the prioritization of profit ingrained into everyday life leads to the exploitation of others.
The idea of passive income is inherently false, as maintenance and experience are required. For instance, content creation of eBooks and online courses is widely promoted as an easy form of income. With the right purpose, this media may bring value — but creation in any form is not passive. Prior experience and marketing is required to adequately generate worthwhile content. For instance, YouTube creators (such as Dan Lok, whose brand revolves around his status as a millionaire) promote passive income for others through online courses, though only the creator benefits from the transaction. Although they supposedly teach financial secrets to get rich quick, the real secret is relying on an unassuming consumer to buy uninformative content.
For the entrepreneurial passive income seeker, dropshipping is seemingly the perfect way to run a business without any involvement. Dropshippers purchase products from wholesale suppliers when customers make orders, which are then shipped to the consumer directly. Investing in marketing and advertisement is required in the competitive environment of dropshipping, and most dropshippers fail to properly profit due to the initial costs. For the dropshipper, inventory is uncertain and based on the wholesaler, and customer complaints aren’t properly addressed since the dropshipper has no real involvement in the packaging of these products.
Customers can easily buy these items for cheap elsewhere, and often face poor customer support when orders aren’t fulfilled. After waiting weeks for their order — due to the long shipping time from wholesalers — orders arrive in cheap packaging, with the products usually being low quality gimmicks that are likely to end up in landfills, contributing to over consumerism.
The promotion of passive income encourages people to get rich through preying on consumers, who are left spending money on overpriced, poor quality products and useless courses.
