Passive income can be another form of side hustle income, except you don’t have to trade your time for it.
Wait, what?
My wife and I recently set up an Etsy dropshipping shop as a part of iliketodabble. This was a small experiment at first to see how much money we could make without having to do much.
The shop sells T-shirts, stickers, backpacks, bags, makeup bags, etc. tailored around hustling, traveling and other topics.
But we don’t have any physical inventory.
Our inventory is with a third party. They ship the product directly to the customer so we never have to do anything (unless there is a problem with the order, which has yet to happen).
This is one example of a passive income stream.
Image Credit: istockphoto/monkeybusinessimages.
What is passive income?
Passive income is earnings from a property, partnership or enterprise in which the person has limited involvement. It usually requires some sort of investment upfront in the form of time, work or money.
Passive income is earnings from a property, partnership or enterprise in which the person has limited involvement. It usually requires some sort of investment upfront in the form of time, work or money.
Your money works for you so you don’t have to.
Image Credit: Zinkevych / istockphoto.
How can I generate passive income?
You can earn passive income in a variety of ways. You could write an ebook, create online courses, invest in stocks and real estate, rent out your property or even rent out your car.
If you have a blog, income from ads and affiliate marketing are considered forms of passive income. But all sources of passive income start from either an investment of time, work or money.
In this specific case with our online shop, we had to put in the investment of work upfront to:
- Create the Etsy shop
- Create the designs for the products
- Upload them into the third party app
- Sync the third party seller app to our Etsy shop (one click)
From then on, we have little involvement besides communication with the buyer if they have any questions. Everything else goes through the integration between Etsy and the third party.
You don’t have to start an Etsy shop to start earning residual income.
There are other passive income ideas that will require much less work than setting up an Etsy shop.
If you are looking for inspiration as you start working towards your passive income goals, check out this list of 85 hustle quotes to help get you revved up.
Image Credit: CrispyPork/ istockphoto .
Passive Income Ideas Using Stuff You Already Have
People instantly think of investing in the stock market when they think of passive income. Well, the stuff you already have is also a sort of investment.
They are both assets, in which they have value and can be converted into cash. If you get creative, your stuff can be used to generate passive income, too.
Image Credit: DepositPhotos.com.
1. Rent Out Your Car
Did you know you can earn money completely passively using your car? That means no rideshare or delivery driving.
You can rent out your car for others to use through apps like Getaround and Turo. Instead of them renting from companies such as Hertz and Enterprise, they rent directly from you through the app.
You could also rent your car out to rideshare drivers that drive for Uber or Lyft using HyreCar. By doing any of these, you could potentially earn thousands yearly by renting out your parked car. Pretty cool, right?
When you aren’t using your car, it is earning money for you!
Image Credit: SrdjanPav.
2. Rent Out Your Space
There are a variety of ways to make money with your property. You can rent out extra space in your home or additional property you own on a variety of platforms including Airbnb and HomeAway.
Airbnb offers resources to you to hire out a third party for daily cleaning so the only work you put into it is the presentation of listings and any communication with renters.
Or you can purchase (or rent) property for the sole purpose of renting it out. Renting apartments for the sole purpose of turning around and listing them on Airbnb is becoming a popular practice.
However, that monthly income isn’t entirely passive unless you are able to hire third parties to take care of any maintenance that is needed (more on that below in #6).
Image Credit: DepositPhotos.com.
3. Rent Out Your Stuff
Renting out your stuff sounds like a scam. But it’s not.
Fatllama is an app that allows you to rent out your stuff to people in your area. Items that do well for generating a passive income over and over again include:
- Cameras
- Video cameras
- Lawn movers
- Game consoles
- and more
Renting out your stuff isn’t the only way to make passive income off of material goods.
You could also try retail arbitrage like Allan from ThePracticalSaver and buy things on sale, clearance, and/or closeouts and sell those via Ebay, Craigslist and other selling platforms. This currently makes Allan an extra $500 a month in passive income.
Image Credit: DepositPhotos.com.
Passive Income Ideas Requiring Monetary Investment Upfront
If you have the money to invest in something that you know will make you some money down the road without you having to do anything from that point forward, would you do it? I would.
Even if there is some risk with it.
Image Credit: PeopleImages.
4. Invest in the Stock Market
Quick note: If you haven’t already, start investing NOW.
Some people think investing in the stock market has more risk than rewards. Nope, nope, wrong.
Investing in the stock market is one of the easiest ways to earn money while you sleep. But you should never do it blindly.
The best passive income investments are dividend stocks and index funds. Dividend stocks are when a company brings in earnings and part of those earnings are then paid back to the investor as a dividend.
Index funds are investment funds that attempt to replicate the performance of any given index of stocks. The best example of these are S&P 500 index funds that are made up of an index of 500 of the largest U.S. companies.
And with a little thing called compound interest, the rewards really do stack up over time.
We didn’t get into investing outside of our retirement accounts until the beginning of this year. I came across an extremely helpful robo-advisor/brokerage service called M1 Finance that made everything very easy for us. With M1, you can browse through pre-built portfolios and trade stocks for free. Yes, there are no fees!
Image Credit: GaudiLab // istockphoto.
5. Invest in REITs
REIT stands for Real Estate Investment Trusts and are companies that own or finance real estate that produces income. Investing in REITs is a great way to generate passive income (from dividends) from real estate without directly owning a rental property.
When using M1: After you add a couple of dividend stocks and an index fund to your portfolio (or use their pre-built portfolios), you can also add REITs.
DiversyFund and Fundrise are also great for investing in REITs. Brandon Neth from FinanceBuzz uses Fundrise as a part of his real estate portfolio and has also been able to achieve leanFIRE thanks partly to his passive income streams.
Image Credit: Chainarong Prasertthai / istockphoto.
6. Buy a Rental Property
You could buy a property to rent out to either a single-family or multiple families. Hiring a property manager to maintain the property and do most of the manual work will make this venture worth your while. But only if the property is worthy.
Cara Palmer currently has six properties that earn her $3,000 a month in passive income. Every year she buys a house, fixes it up and then rents it out!
As mentioned above, you can also list that property on Airbnb. However, what a lot of people have started to do is not even buy the property they are listing on Airbnb. Instead, they just rent it (with landlord approval to use Airbnb).
But you will need to calculate the ROI (return on investment) to see if it is worth it. Some things to take into account are the rental income, mortgage paid down, possible work and maintenance needed and change in property value.
If you play your cards right, you could be bringing in monthly income without you ever having to step foot in your rental property. There are apps that help you do this like Roofstock where you can actually purchase the rental property through the app itself.
Image Credit: DepositPhotos.com.
7. Website Investing
Website investing is like investing in real estate…but in real estate of the internet. That’s what websites are if you think about it; digital real estate (and some are worth thousands of dollars or more – if not millions).
There are a variety of ways that you can go about website investing including (but not limited to):
- Buying and selling websites
- Creating your own website
Let’s go with the last option: creating your own website. You could purchase your own domain and build out a site and following from the ground up. Then you can go about partnering with a company like Onfolio where they run the day to day operations and you get paid for doing next to nothing.
Image Credit: Sergey Nazarov / istockphoto.
8. Peer-to-Peer Lending
Peer-to-peer lending is when individuals can lend directly to other individuals. Instead of going to the bank when people are needing a loan, they can borrow from other individuals.
The lenders can then collect interest on these loans, the same way financial institutions do. The returns generated from the interest produce a passive income stream for lenders.
So how does one get started with something like this? Craig Cecilio, Co-Founder and CEO of DiversyFund recommends Upstart to invest in peer-to-peer lending. Lending Club is another popular option.
Image Credit: DepositPhotos.com.
Passive Income Ideas When Creating Your Own Products
When you create your own product whether it be a physical or online product, there is definitely work required upfront.
Once that upfront work is complete and you have the product for sale on an easy to use platform or using an effective system, the income comes passively for the most part.
Image Credit: Ulza/istockphoto.
9. Create a Course Online or eBook
Creating a course online with a platform like Teachable makes it easy for you to manage your course with little ongoing maintenance.
The only thing required from you is that initial work upfront to create the course. From that point on, Teachable hosts your course and sales pages for you, manages the payments and even manages the affiliate program attached to your course(s).
However, you will need to go in and update course content periodically.
The same thing goes for writing eBooks. The only work required is the writing of the eBook (along with finding a publishing platform, people to review it for you and/or promote it, etc). But once you have it set up on an efficient platform, your involvement is little to none.
This is one passive income source that I am dying to get my hands dirty with (and currently have in the works).
Image Credit: fizkes/ istockphoto .
10. Sell Stock Photos
If photography is your thing, you could be making some serious cash by selling those photos as stock photos online.
Ways to sell stock photos online:
- Sell on your own website
- Sell on a stock marketplace like Adobe Stock
- Become a contributor on sites like Shutterstock and earn 20% to 30% of the purchase every time your content is downloaded by one of their customers
- Create stock photo packs to sell on Etsy
- Sell photos from your travels on sites like TourPhotos
- Sell nature photography
- And more options listed in this post (which I sourced from for this section)
Once you have your photos loaded and ready to sell, sit back and relax. This passive income idea can be a fun one. Especially if you are a digital nomad, this could be a great gig for you to fund your adventures.
Image Credit: DepositPhotos.com.
11. Sell Videos
This is one passive income stream that I have been looking for someone to speak on (mainly because it is something I want to do with our travel videos).
Thanks to the FinCon FB Community, I found them. Peter from DollarSanity has been able to make $5,000 from selling his videos to news and media outlets.
Peter mainly uses Rumble and Newsflare to sell his videos online. He suggests that “if you have anything interesting to offer to the world, feel free to explore your options.”
Video categories that stand out and sell easily include:
- Funny videos
- Pet videos
- Crazy weather phenomenon
- Kids doing crazy stuff
- Political protests or anything controversial happening
- Accidents
- Heartwarming animal rescue
Image Credit: Space_Cat / istockphoto.
12. Open an eCommerce Store
Our Etsy shop that I referred to in the beginning of this post is an eCommerce store. It isn’t one that we personally host. Instead, Etsy hosts for us (with the help of third parties for our products and shipping).
Other ways to open an eCommerce store for passive income include using an eCommerce platform like Shopify, hosting the store directly on your site using a plugin like WooCommerce, sell on Amazon, etc.
You can create an eCommerce store with literally anything you can think of. Use the two previous ideas in #10 and #11 and open an eCommerce store full of stock photo and video packs.
Or use our Etsy model and create your designs on PicMonkey, Canva or Adobe Photoshop, upload them to products on Printful or Printify and link it all up to your Etsy!
Unless you outsource any ongoing management of your store, you will need to keep up with customer interaction and complaints. Besides that, the maintenance is pretty minimal.
Image Credit: Poike / istockphoto.
13. Product Licensing
Do you have a really good idea for a product or invention but have no idea how to pursue it? You could end up making a lot of money off of that idea so don’t let it go to waste.
A couple of steps are required but once complete, you get paid essentially just for an idea.
To start licensing your invention idea, this post is a great guide. In a nutshell, it outlines the steps as:
- Start with a problem
- Look for similar products and if they exist
- Search the USPTO
- File a provisional patent application (I have 1 patent so far thanks to the company I work with for during my day job)
- Find out how to manufacture the idea
- Generate a nondisclosure agreement
- Create your sell sheet
- Make some inquiries
- Offer more product information
- Seal the deal with an attorney
- Get paid
I got to talking to some of the women in the Women’s Personal Finance (Women on FIRE) Facebook group, and one of the members, Cathleen, had some useful information to add to this process:
“Until you file for and pay the fees on a non-provisional patent application, you have done nothing but establish first to file status and you have about a year to file a non-provisional before the provisional effectively ‘disappears,'” Cathleen said.
“Many companies (from what I’ve seen) want a provisional already in effect. There’s lots of resources for pro se inventors to pursue, starting right at the USPTO.gov website under ‘inventors’ tab. Many law schools have pro bono supervised work done by students and many law firms participate in pro bono volunteer work.”
Yea, it seems like A LOT of work upfront. But the royalty checks will be more than worth your while.
Image Credit: DepositPhotos.com.
Online Passive Income Ideas
Even though most of the ideas discussed in this post are done online, these are the main ones that require an online presence.
An online presence is important if you want to build a following. The ideas discussed below need a solid following (and foundation) to build up to a flowing passive income source.
Image Credit: svetikd.
14. YouTube
The way most YouTubers make money is through the ads that are displayed on (and throughout) their YouTube videos and affiliate links placed in the description of the videos. Some also make money with shops linked to their brand and channel, products and courses they create, a website where they also post articles with their videos included, etc.
There are so many possible avenues you could take with your YouTube channel. I can’t think of one niche that doesn’t do well on YouTube. Probably because most people are visual learners and they rather watch something than read it.
For example: A friend of mine has a successful tarantula/exotic pet YouTube channel. Yes, tarantulas may seem a bit extreme but it’s a passionate hobby of hers. And as you can see by that follower number, she is doing pretty amazing with her channel!
If this route is something you’d like to explore, I suggest to try and make videos that don’t have too much competition and be consistent.
In addition to that, this post from Fit Small Business lists 20 other ways to make money on YouTube (from the pros).
Image Credit: DepositPhotos.com.
15. Start a Blog
This is an extension of #7 above since a blog is a website.
When you are starting your own, it requires both time and monetary investment upfront. But you can definitely outsource the day to day operations of your blog as #7 above suggests.
Or you can do it yourself and build multiple streams of passive income that originate from your blog like:
- Displaying ads on your blog like the multiple ads you see on this blog.
- Promoting affiliate products and services while making a percentage on anything that is clicked on, signed up for, or purchased through any links a user clicked on from your blog.
- Selling your own products on your blog.
- Sponsored content is another great way to earn money with your blog and influence but is more an active income than passive (since it requires you to complete a service).
Then down the line, if you feel like you don’t want to run your blog any longer, sell it and cash out!
Do you think I am joking? Blogging might not seem like the best avenue for passive income down the line. You are probably thinking – “Well, that’s a lot of effort.” And it is.
But it is so worth it.
I created iliketodabble two years ago and make $3,000 a month from it now. However, my blog isn’t entirely earning income passively yet (it’s getting there).
My ad income comes from no manual work from my part. After the initial set up, they are hands-free. The same thing goes for my affiliate income after I place the links there isn’t any further work needed from my end (usually just minimal admin work).
The manual part is producing high-quality content to make that passive income possible.
A great example of a blog that is entirely passive is Avocadu. Alex and Lauren created their blog Avocadu back in 2015. Today, that same blog earns $20,000 a month in passive income. Like, wow.
Image Credit: anyaberkut/ istockphoto .
Easy Passive Income Ideas
Easy passive income ideas are sources of extra income that you can easily set up today.
Wouldn’t you rather beef up your savings account and transfer your savings into a high yield savings account, be prepared for retirement and get paid for things you already do?
Yeah, me too.
Image Credit: DepositPhotos.com.
16. Open a High Yield Savings Account
I just recently switched a portion of our savings to a high yield savings account (that was higher than our local credit union) to Haven Money.
At Haven Money, you can earn up to 4% APY (annual percentage yield) on your savings. So, if you move $1,000 over to Haven Money, you could potentially earn 4% on that money without ever having to do a thing.
Image Credit: DepositPhotos.com.
17. Invest in Your Retirement
If you work a job where they match any part of your retirement contributions, opt for at least that amount to contribute per paycheck. That company match is free money.
I am lucky that my job matches 10%, so I contribute 10% of my salary. This job has had the highest match out of any past job I’ve had and for that, I am so grateful!
Maybe you need a little outside help? Usually, the company you work for will have services where they help you effectively manage your retirement accounts (some are free and some are not). Even if they do, you should connect that account to Blooom and see how you’re really doing.
Blooom takes the confusion out of your retirement. For free, they look at your current 401k and see how they can improve it. After your analysis, Blooom will place the trades within your account for a low flat fee.
They also make hidden fees easily visible and will steer you towards the lower-cost funds in your 401k without hurting your investment goals.
Image Credit: adamkaz.
18. Use CashBack Apps and Credit Cards
Earning money back without any physical work is a different sort of passive income. It is more of a reversed passive income to earn cash back using apps and credit cards.
I personally love Rakuten for shopping or ordering anything online. Rakuten is an online app and browser extension that automatically detects savings for you based on the website you are browsing and alerts you of the potential cash back when you purchase anything on that site.
You can even earn air miles passively to apply towards future free travel.
Other popular cashback sites, apps and cards include:
- Ibotta: Get cash back for grocery shopping, shopping online, completing challenges and more.
- Dosh: Get cash back at gas stations, restaurants, hotels and more.
- Southwest Rapid Rewards Cards: Earn 40,000 points with any Southwest personal Credit Card and business owners can earn 60,000 points with the Southwest Premier Business Credit Card.
Bonus tip: You can also earn money for referring your friends to these apps and cards like I may earn money if you sign up and download these apps using my links (visit the referral section of the app or card site to learn more).
Image Credit: DepositPhotos.com.
19. Get Paid for Your Internet Usage
Much like online surveys and research studies are used to improve products, there is a company called Nielsen that strives to do the same thing through your internet usage. In exchange, they pay you for using your internet as you normally would every day.
Image Credit: simpson33/istockphoto.
Earn Easy Money
It is so crazy how fast everything moves online and in technology. No wonder there are more ways to earn passive income and build multiple passive income streams today than ever before.
There are more investment apps, robo-advisors, online services and hosts, online banks, etc. that you can use to make any amount of money you want without ever leaving your home. There are apps now that create entire new types of jobs and not only that, ways to make money passively (like Airbnb).
Money and tech have combined to create amazing opportunities for people. And people are taking advantage of those opportunities. In fact, it is one of the reasons why so many people are able to reach financial freedom and independence early on in their lives.
I am excited to see what else is to come in the future. We can only go up from here!
This article originally appeared on ILikeToDabble.com and was syndicated by MediaFeed.org.
Image Credit: AaronAmat / istockphoto.
