Featured Image: @tourdelust
Article By: SA BAL
The greatest thing about passive income is the FREEDOM that comes with it. Finding a secure job is difficult, and with so many industries set to be taken over by automation, our economic future has never been more uncertain.
With passive income, you can turn the odds in your favor:
- Passive income is unrelated to the amount of work you put in
- It lets you generate long-term income after putting in minimal effort
- It gives you financial independence, lots of freedom to travel, enables you to have fun, and pay your bills at the same time.
The first thing that may come to mind is blogging, but there is more than just one way to generate money while you sleep –and you don’t have to be a dedicated writer to do it!
1. Dividend Paying Stocks
This way is the most popular, most secure mode of generating passive income and it is at the top of our list.
A company is entitled to pay to its shareholders a percentage of the total stocks. So, investing in and becoming part owner of a growing company is a suitable means to make passive income. However, make sure you conduct thorough research before putting in your cash. Invest in a less-volatile industry, in a steady-growing company.
To learn more about dividend investing check out these helpful post:
- The Single Best Investment: Creating Wealth with Dividend Growth
2. Invest in REITs (Real Estate Investment Trusts)
Another form of stock or exchange-traded fund, REITs allow you to invest in real estate without owning, managing or improving a personal property. REITs have an exponential rate of growth for their capital and have increased dividend yields.
3. Peer-to-Peer Lending
Also known as ‘Crowdlending’ or ‘Social Lending,’ P2P is a mode of financing those in debt without the involvement of a financial institution at any stage of the process.
Individuals essentially ‘rent out’ their own money in return for an agreed rate of interest. Although this comes with some risks; the transactions are faster and require fewer technicalities. Lending Club is a great company to sign up for to get started with.
4. Crowdfunded Real Estate
When beginning an entrepreneurship venture, the person may expand their pool of investors through a network of family members, friends, and colleagues.
Usually, this involves the social media platforms to get the word out about the startup and is called crowdfunded real estate.
It is a relatively newer market and may come with increased risks. But if done right, investing in crowdfunded real estate means that you get about 10% interest in buying and improving real property.
This method is somewhat like Youtubing, blogging, and selling your content all at the same time. Webinars, or ‘Web Seminars’ are a tremendous opportunity to reach the global market with your content through video series and virtual programs.
The only catch is that these are mostly academia-based, and conducted through educational institutes-so if you’re an educator, look into it.
E-commerce is at its peak and provides an incredible amount of opportunity. With drop-shipping, you can arrange to pay for a product to be labeled and shipped under your name –without having to touch it or pay the overhead.
The monetary returns of being part of an online business can be huge because of how profitable e-commerce is.
7. Digital Content: Blogs, Affiliate Marketing, and Youtube
This passive income is a little more time-consuming and resource-intensive than the rest of the options we have on the list.
Blogs, affiliate marketing, using social media and other forms of digital content are not exactly a hundred percent passive because they require a lot of set-up time.
But some people have earned up to $60,000 to $100,000 monthly through their blogs, and of course, there are young people earning millions of dollars through their Youtube videos.
The fundamental principle to remember when it comes to digital content is Traffic = Money because most of the income generation here is through marketing and advertisements.
You can start a blog for as low as $3.95 with SiteGround, and start promoting your favorite products to your audience to earn extra cash.
8. Selling Digital Products
If you have a website already, then you can earn income additional to the one you generate from ads and marketing; and that is by selling your products online.
People do this in different ways, some write ebooks, some make online courses for what they are good at, some put their pictures out for licensing –but there’s a catch. You have to pay a certain amount of cash to access their content. You can use a website like Sendowl to sell your digital products and start making money.
9. Index Funds and ETFs
For people who have all the money that dividend funding usually requires, and not enough time and expertise to indulge in the process, index funding and ETFs are the way to go.
Index Funds and ETFs are also less risky, less of a gamble, and overall involve less strategic planning – the rest is the same as Dividend funding. Before you decide to invest your money in index investing and ETFs do some research and check out The Bogleheads’ Guide to Investing.
10. Rent Your Stuff
Renting out stuff that you already own is one of the smartest ways to generate income. This property has to be something that belongs to you.
Some of the most popular things that people rent out include a portion of their house, their car, bike, truck, or parking space, or they even letting people use their boombox for a one-time event.
If you have extra rooms in your home that you don’t use, you can start earning money now with websites like Airbnb.
Some vehicle owners even get paid for putting up posters on the back of their vehicles for advertisement purposes.
11. High Yield Savings Accounts
If you have savings in any form or shape, you can switch them to a savings account. This method does not yield a lot of profit, and in America, the interest rate is meager. However, even a 10% growth rate is better than nothing. There are plenty of online banking options available these days that offer much better turnover opportunities.
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12. Network Marketing
Probably the most criticized of all passive revenue ideas are the pyramid schemes, which is why they are at the bottom of our list –but they still work. Herbalife is one such example of a pyramid scheme.
This form of investment in which the owner makes advertises for and sells a product. Every person recruited for advertisement of the product is obligated to hire a certain number of people, and they need to refer a certain amount of people. And so forth. This process makes a hierarchy or a pyramid, which gives these schemes their name.
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