Passive income — earning money without working for it – has an obvious appeal. But some passive income ideas seem like a waste of time to me. I do not believe I will earn income from them, they are not passive – or both. One approach I do like though, is to invest in shares I reckon can pay me dividends in future. A dividend is a bit like a profit split – a company that has surplus cash can choose to pay some or all of it out to people who own its shares. Let me explain why I like this approach. With even a small amount, I can buy a stake in a large company like BP or Tesco that already has a proven business model and is profitable. Rather than reinventing the wheel with some wacky passive income idea, I can simply stake a claim on a piece of a wheel that is already turning smoothly – and profitably! Put like that, things sound very simple. Passive income does not need to be complicated. Having said that though, I need to be conscious of the risks. I see two big ones when it comes to trying to...