Cash Flow With Joe

Disposable income

Disposable income


The other day, I took my road bike to my local bike shop to get it looked at. It had something weird going on. On my previous ride, I started hearing a ticking sound in my wheel. Prior to the ticking sound, I was averaging over 18 mph. But when the tick sound started, it was all I could do to hit 15 1/2 mph, and it made for a tough ride.


As I walked into the shop, the owner and another patron were talking about bikes. The customer was talking about a particular brand and how great it was. Then, he said he’d seen two of them for sale recently. One was advertised for $3,000 and the other for $5,500. My jaw dropped. And I let out a verbal “Wow.” The customer gave me an inquisitive look. I told him that I thought that was a lot and compared it to the price I paid for my first truck, which was only $2,000.


What happened next was interesting to me. The customer smiled and said, “Well, we are in our mid 40s now and have extra disposable income.” He laughed, and we moved on. But that whole scenario really got me thinking.


Before we get going, let me ask you what you think the term “disposable income” means.


I think most people would say that disposable income is the money you have left over from your paycheck after you pay all bills and living expenses. And do realize, I didn’t know this customer from Adam. But going off that definition, and the reference to his age, I would assume that his income had risen over the years he had put into his profession. And thus, I assumed, he had more income after all his expenses were paid.


But I still wasn’t sure what the customer meant by that statement or why you would want to pay $3,000 to $5,000 for a bike.


You see, aside from knowing how to ride them, I don’t know that much about bikes. So I don’t know how to justify paying that much for one.


But I do know something about money. And I’ve never considered income to be disposable. You see, when I think of things that are disposable, I think of things you use once and then throw away like paper plates. But your income should not be something you use once and then throw away, especially when you consider the fact that most people derive their income from trading their time — i.e. their lives — for money at a job. So, if you consider what’s left over from that exchange “disposable,” I don’t think you’re giving it the value that it deserves.


So, instead of thinking of leftover money as disposable, I think you should lean towards the concept of renewable income. Let me explain what I mean by that.


When I think of things that are renewable, things like solar power, where you harness the energy from a source that never runs out, comes to mind. Renewable income lines up nicely with that. It allows you to buy or do something that brings in income over and over again without you having to work for it. (Royalties are a great example of this. I had an uncle who was a country singer in his 20s and was still receiving royalty payments in his 80s from his records.)


In my world, renewable income is called rental income. It’s one of the best ways out there for someone to get paid without having to trade their time for money. And it really works.


I have friends who have retired and live solely off the income from their paid-for rental properties. Right now, they are out traveling the world, doing things like scuba diving with sharks, going on cruises and visiting exotic places. But here’s the thing: Their income doesn’t run out. They told me that every month, their bank account actually gets bigger because they have more income from those properties than they can spend each month.



Not having to work, having more money coming in than you can spend while having the time of your life sounds amazing, doesn’t it?


You can do this, too! But it will require you to stop spending your extra income on disposable things and start putting it towards a renewable source like rental property.


Joe and Ashley English buy houses and mobile homes in Northwest Georgia. For more information or to ask a question, go to or call Joe at 678-986-6813.


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