Step Change

The blog on leveling up your finances to achieve financial independence.

The Ideal Definition of Passive Income

Nov 19, 2023
Illustration of tap coming out of laptop screen with coins flowing

How UNEarned Inc Defines Passive Income

It goes without saying that in order to create passive income at one point you had to generate active income... a lot of it. But even in the various chat rooms across Reddit, X (formerly Twitter), and other channels, people still get into endless debates about what is truly passive income.

While unearned income doesn't discriminate against any legitimate way of making money, we always have the goal in mind of creating streams of income that are truly passive. Here is our rather strict definition:


  • The income stream does not require you to take further action once setup
  • You could literally “die” and money would still hit your bank account or come to your mailbox on some periodic basis (e.g. weekly, monthly, quarterly)


  • The income is (un)earned at some regular and predictable interval
  • The risk of scheduled payments stopping or getting interrupted is very, very low

Geographic Independent

  • The income stream is not dependent on where you live
  • The income stream does not require you to be in a certain location to collect
    You can monitor and manage your investment from anywhere in the world (e.g. through a mobile device)