Creating passive income is the ultimate dream for most wealth building practitioners. Having passive income frees you to focus on new endeavors and activities, and over time, it can free you from the burden of ever having to work at anything that you don't thoroughly enjoy. However, there continue to be several myths around this relatively simple subject matter, and we present four myths about creating passive income that tend to bedevil the novice wealth building practitioner.

Myth #1: Building passive income is very hard - Many individuals don't even try to develop a passive income simply because they think it is very hard. The thinking of such individuals remains confined to earning money for services rendered, which leaves the entire realm of making your money or other assets work for you untapped. While there is definite work that is required to begin building streams of income, they can be mastered with reasonable effort and mentoring. If you are stopping yourself from creating passive income because it is a difficult enterprise to undertake, banish that thought today.

Myth #2: Passive income implies no work - This is not a complete myth, but a half-truth. Creating passive income requires work, plenty of it, but once you are done, it requires minimal management to maintain the income flow. Even then though, you cannot totally ignore the income source. Be prepared for the upfront effort of learning the skill and executing on a plan for setting up a passive income source. For example, if rental income is your method for generating passive income, you have to master the art of buying reasonably priced real-estate, and be an effective landlord. If acting as an affiliate online is your methodology, you must master the art of setting up a useful website and bringing in low cost traffic to your site. The fun is on the other side of the setup and execution phase!

Myth #3: There is no risk in generating passive income - Creating passive income sources is risk-free only if you have your entire portfolio into CDs or government bonds and are getting paid through interest only. The wealth building practitioner is however on the lookout for quick opportunities for setting up passive income sources. This involves real-estate rentals, online membership sites, affiliate partnerships, creating info-products for sale through infomercials and online sales - in effect, setting up small businesses that throw off income for you. However, in each situation, the risk of failure is high - without proper training and learning how to master each type of business, failure is assured - leading to loss of money, time and energy. You can manage this risk by lowering the upfront investment and getting the right type of training before you launch. Also, launch low-key, conquering the simplest steps first and then increasing the complexity of the business.

Myth #4: You need a lot of cash - We touched on this in the previous myth, but it deserves a place all its own. You don't need a lot of cash to generate more cash - otherwise what would be the point of enterprise? It does mean there will be more effort needed upfront to ensure that your rental property is purchased with a good loan and rented out correctly; that your choice of membership site is carefully chosen and so forth - but it does not mean that you need cash to set up passive income sources. Often, the lack of cash will force you to be more inventive than usual, and enforce a discipline on you.

We hope these basic myths are banished from your mind forever when it comes to generating multiple streams of passive income!