Passive income refers to income that is generated with minimal effort or active involvement once the initial setup is done.
There are many ways to make a passive income. Making passive income is similar to putting effort into any job. After all passive incomes cannot be generated by themselves. Generating income would require trading of time or money. The goal of having passive income is it keeps flowing after a few years of work unlike the old way of making money (ie. trade hours to make a paycheck).
If you’re reading these articles you must take action today to start your journey of passive income. The detailed steps are listed below for each of these list items. Just click on the link to navigate to the individual ideas
Here are ten popular passive income ideas:
- Rental Properties: Investing in real estate and earning rental income is a classic example of passive income. You can purchase properties and earn monthly rental income from tenants.
- Dividend Stocks: Invest in dividend-paying stocks. As a shareholder, you can earn regular dividend payments without actively participating in the company’s operations.
- Peer-to-Peer Lending: Platforms like LendingClub or Prosper allow you to lend money to individuals or small businesses. You earn interest on your loan as borrowers repay the principal and interest.
- Create and Sell Digital Products: Write an e-book, create online courses, Pictures you take on vacation or develop software and sell them on platforms like Amazon Kindle, Udemy, or your own website. Once created, these products can generate passive income from sales.
- High-Yield Savings Accounts: Open a high-interest savings account or a certificate of deposit (CD) with a bank that offers competitive interest rates. Your money will earn interest over time without much active involvement.
- Affiliate Marketing: Promote products or services through your website, blog, or social media channels using unique affiliate links. When someone makes a purchase through your link, you earn a commission.
- Create and Monetize a YouTube Channel: Start a YouTube channel and create videos on topics you are passionate about. You can earn money through ads, sponsored content, and merchandise sales.
- Stock Market Investments: Invest in stocks and earn passive income through dividends and capital appreciation. However, be aware that stock market investments carry risks, and thorough research is essential.
- Royalties from Intellectual Property: If you have creative talents, such as writing, composing music, or inventing, you can earn royalties by licensing your intellectual property to others.
- Create a Mobile App: Develop a mobile app and monetize it through in-app purchases, advertisements, or subscriptions. Once the app gains popularity, it can generate passive income.
Remember, while these are passive income ideas, they often require some upfront work and ongoing maintenance. It’s essential to research, evaluate your skills and resources, and choose the most suitable option for you.
Tips
- Before making an investment research tax-saving laws and create a plan
- Never purchase investments in an emotional state. Calculate and evaluate all the options and your financial state before purchasing
- Buy investment properties and valuables when you do not need them (does not mean buy useless items). e.g I bought great velvet blazers for $30 and $160. Both are the same brands, I paid $160 because I desperately needed one, and the other one I purchased was on sale when I didn’t need but I envisioned vacation 6 months down the road.