Personal Finance

How To Generate Passive Income Through Lease Investing?

Generate Passive Income Through Lease Investing

With changing times, new investment approaches are being preferred by investors. Today’s investors are smart and believe in making prudent decisions. While they want a diversified portfolio with steady passive income and fixed returns, they also actively invest in alternatives, so that they can create wealth through multiple sources.

Passive income has become an important factor that aids wealth creation. Passive income refers to the earnings generated from an activity or investment in which the investor is not actively involved. Considered one of the most trending passive and profitable options, asset leasing is an investment that one should know about.  

Asset Leasing

Asset leasing is an excellent new-age alternative investment (AI) option that is preferred by many companies, owing to the advantages that it offers.

Before we dig deep into the concept of lease investing, let us understand its basic concept. Leasing mainly involves a contractual agreement between two parties, i.e., the lessor (owner) and the lessee (user) for the usage of an asset like equipment, furniture, vehicles and electronics among others, for a specific period against regular payments.

An individual or a company can be a lessee or lessor. Thus, leasing contracts can be between individual to individual, individual to company and company to company. These days, major companies and multinational corporations (MNCs) choose to lease because companies require a lot of assets, while for owners of these assets, namely the lessees, it becomes one of the best passive income sources.

How Does Lease Investing Work?

Companies nowadays choose to work on asset-light models. Thus, companies are leasing their machinery and equipment rather than buying it. 

Regular payments in exchange for the used asset are provided for a predetermined period by entering into a contract with the lessee (user) and lessor (owner). 

Investors who provide leases can purchase items like furniture, electronics and vehicles in exchange for fixed and non-market-linked monthly returns that help businesses scale faster. Within 24 to 36 months, individual investors can earn up to 21% pre-tax IRR on their investment. 

Hence, asset leasing is a short-term investment option for small investors to reinvest and accumulate funds. It is a source of fixed passive income with stable returns. With proper investment, it will not be difficult to plan an early retirement or accumulate funds for future projects.

Why Asset Leasing?

In basic terms, asset leasing is a great alternative for companies that require various operational assets for their business and want to remain asset-light. These companies choose to lease rather than buy assets. 

Asset leasing also allows companies to hyper-scale and address the needs of their increasing customer base. Hence, asset-heavy businesses like airlines, heavy equipment companies and manufacturing concerns choose lease investing. These days smaller companies thriving online, like furniture or shoe manufacturers, take interest in asset leasing. 

As an investor, this low-risk, AI fetches fixed and lucrative monthly returns enabling investors to diversify their portfolios. 

So how do you invest?

Grip is a new-age disruptive platform that facilitates lease investing and enables leasing contracts with investment amounts as low as ?10,000. Companies on Grip raise funds for buying assets, creating passive income opportunities for investors. Grip performs due diligence on each company it onboards. Add this passive income option for a diversified investment profile, visit Grip without delay.

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Published on
December 29, 2022
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