Passive income is earnings that require little or no active work to maintain. Unlike a salary, you are not trading time for money. Common sources include:

• Dividends from stocks or mutual funds
• Interest from fixed deposits, bonds, or debt funds
• Rent from real estate
• Royalties from books, courses, or intellectual property
• Annuities from NPS or pension plans

Role in FIRE

The goal of FIRE is to build a portfolio large enough that passive income (or sustainable withdrawals) covers your expenses. “Passive” does not mean zero effort—investments need occasional rebalancing and tax management.

India Options

• Equity mutual funds (dividend or growth + SWP)
• PPF, EPF, NPS interest
• Rental property
• SWP (Systematic Withdrawal Plan) from mutual funds