Your ultimate guide to finding ways to make passive income
We all want it someday – a beautiful house, the latest car model, a glamorous wedding, comfortable retirement, just to name a few wants. But, with a 9-5 paycheck job, it all seems nothing but a dream.
So, how can you turn the dream into reality? The answer is finding ways to make passive income, and I’m here to inspire you.
Whether it’s finding it hard to pay the bills, not having enough to save, or staying without a job, I have been through it all. So, I write to you from personal experience.
But before I can take you through the various passive income ideas, let’s first understand what passive income is.
What Is Passive Income?
According to the IRS (Internal Revenue Service), passive income is earning from any of these sources:
- Rental property
- A business you are not actively involved in
Yes, you can make money while sleeping, but you have to do some minor jobs or invest in something beforehand, and that’s where I come in.
I’ll suggest 25 passive income ideas that’ll help you get closer to becoming financially independent.
Simply put, my ideas should help you generate income through multiple streams without succumbing to the demands of a 9-5 job.
Interested? Let’s get started
Ways To Make Passive Income: 25 Passive Income Ideas
1. Blogging – Start A Blog To Earn Passive Income
Blogging is all about writing educative and exciting content. Mostly, it’s about sharing your opinions, something that anyone can do with the right guide.
Speaking of the right guide, here’s one for beginner bloggers that you can use to build a profitable blog.
Additionally, check this Income School course to learn a few things about monetizing your blog. I get most of my ideas from the training, and so you should consider signing up.
But, how exactly do you make money on your blog, and how much can you make?
There are so many ways, but these are the most popular:
- Paid ads
- Affiliate links
- Merchandise sales
- Selling courses
- Product recommendations
In terms of estimation, you can make anything between $0 and $10,000. It all depends on the content you create, the promotion effort, and your monetization strategy.
I, for instance, make around $3,000 monthly blogging part-time.
Are you willing to give blogging a chance?
Then use my link to sign up with Bluehost for domain registration and hosting service. It’ll only cost you $2.95 a month (for the hosting), and you get your domain name for free.
2. Affiliate Marketing – Make Passive Income As An Affiliate Marketer
Affiliate marketing is the act of promoting a given product or service to your readership using special links called affiliate links.
In most cases, you earn on a pay-per-sale (PPS) basis, where a person who clicks on your affiliate link ends up making a purchase.
But still, you may also earn on a pay-per-click (PPC) basis, where the site visitor only needs to click on your affiliate link for you to make money.
Mostly, affiliate links work well on blog posts, where you recommend products to your readers. But still, you can use the links on social media and emails.
If you are wondering how to make passive income as an affiliate marketer, consider signing up for these affiliate programs:
3. Start A YouTube Channel To Make Passive Income
Alongside blogging, YouTube is one of my best ideas for making passive income. But unlike blogging, there aren’t as many competitors YouTube channels like blog posts.
Thus, there is an improved chance of finding a sizeable audience for your videos.
How do I make money on my YouTube channel?
I rely on paid views on my YouTube channel. But still, ads do inject some cash to supplement what I get from paid views.
What can you do on YouTube for cash?
Try offering tutorials or vlogs (the video-version of blogs).
4. Selling Courses Online To Make Passive Income
Are you a trained teacher looking to earn some cash passively on top of your teacher’s salary?
Perhaps you are not a trained teacher but an expert in a particular field like medicine, engineering, finance, or a foreign language. Regardless, consider creating courses and selling them online.
The lucrative idea allows you to set prices for your course and sell it all year round. So, provided you sell, you’ll always make easy passive income.
Some of the best platforms to not only create your online course but also sell it are:
If you have a blog, you can also use it to promote and sell your online course.
5. Sell eBooks Online To Make Passive Income
If you are a blogger, it should be easy to write an eBook. The idea is also easier for novelists and those who enjoy writing travel guides, cookbooks, and personal journals.
An eBook is just a regular book in an electronic/digital format. So, its form allows you readership to download it.
But are you aware you can earn passive income when readers download your eBook?
That’s possible with Amazon Kindle Publishing. The self-publishing Amazon service allows you to publish your eBook for free. And within 5 minutes, your eBook becomes available on Kindle stores globally.
What’s more, you retain the copyright and get to receive up to 70% royalties.
6. Sell Audiobooks Online To Make Passive Income
Instead of writing an eBook, how about you narrate your story? That’s what an audiobook is all about, and you can sell it online for some good cash.
So, where can you sell it?
Awesound is a good starting point. The website allows you to sell your audiobook directly to listeners, and you get to keep 80% of the sale.
You can also try selling on Amazon through the Amazon Education Publishing network. The network allows you to create and publish your audiobook for free and distribute it among Amazon customers.
Amazon then pays you 40% royalties.
7. Launch An Ecommerce Store To Make Passive Income
Whether you plan to resell items or sell your crafts, launching an ecommerce store is a fantastic idea. It’s among the best ways to make passive income as a trader.
If you prefer items reselling, you can use platforms like eBay and Facebook to create your store. And if you choose to sell handicrafts like jewelry and art, Etsy is an excellent platform for that.
But still, you can use an ecommerce store builder like Shopify to build your standalone ecommerce website.
8. Invest In Online Arbitrage To Make Passive Income
Don’t let the word arbitrage scare you. Online arbitrage is just the practice of buying cheap and selling at a profit online. If, for example, you want to sell on Amazon, then you have to find the items cheaply at a different store.
Ideally, you should remember the following when investing in online arbitrage:
- Pick items that sell quickly
- Avoid bulky goods to keep the storage and shipping costs low
- Buy your items at half the price of what you’ll be selling. That’s because you have to factor in added fees and your profit margins.
Remember, you can also sell on eBay and so online arbitrage is not just for Amazon.
9. Invest In Rental Property To Make Passive Income
If you can raise the deposit money to buy a rental property, you should go ahead and do it. It’s the best way to make passive income every month.
The critical thing here is to project how much you’ll pocket once you pay off all your expenses. That includes the cost of managing the property, repair expenses, and licenses if any.
It doesn’t mean, however, that you have to finance the property by yourself. Banks are always willing to lend a hand if you have a good credit score.
The good thing is that you can pay them back with the money you receive as rent.
10. Buy REITs (Real Estate Investment Trusts) Shares
REITs refer to companies that finance, own, and operate income-generating real estate.
Such companies provide you with the opportunity to buy real estate shares and get to earn dividends-based passive income.
Investing in REITs is likened to investing in other company stocks or ETF (Exchange-Traded Fund). In this case, you earn dividends proportional to your investment.
According to REIT.com, nearly 87 million U.S investors own REIT shares. So, you shouldn’t hesitate to do it.
Some of the best REITs to invest in today are:
- Retail REITs
- Historical returns REITs
- Healthcare REITs
- Mortgage REITs
- Residential REITs
11. Buy Stocks That Pay Dividends
Though it’s regarded as an old way of earning passive income, dividend-paying stocks are a fantastic investment vehicle.
With most stocks paying dividends quarterly, you are guaranteed to receive some financial returns from your shares every three months.
Some of the best dividend-paying stocks today are:
- National Health Investors (NHI) stock
- Altria Group Inc. (MO)
- Universal Corp (UVV)
Are you interested in buying dividend stocks and learning how to generate passive income from them? Do it through an ETF (Exchange-Traded Fund).
12. Sign Up For A High-Yield Savings Account
No doubt, putting your money in a savings account secures your financial future. But still, doing so can also secure your financial present if your savings account can earn you interest.
I’m suggesting you go for high-yield accounts as they offer you zero-risk high returns. Typically, high-yield savings accounts pay as much as 20-25% of the yields of traditional savings accounts.
Where can you find these accounts?
You can get such accounts at your local bank, but online lenders offer the most significant returns. Some of the banks paying the best annual percentage yields (APY) are:
13. Invest In A High-Return Certificate Of Deposit (CD)
Credit unions and banks nowadays offer interest rate premium products to customers who pay lump-sum deposits for a defined time. Such products are what we call certificates of deposits (CD).
Usually, the highest paying CD attracts the highest interest rates, and it’s more than what you get from regular savings accounts.
The good thing about the CD is that they are safer than bonds and traditional stocks. They are also nonvolatile and guarantee a specific rate of return.
With virtually every financial institution offering Certificates of Deposit, talk to your bank, broker, or credit union about your options for passive income streams.
14. Invest In A Bond Ladder To Make Passive Income
A bond ladder refers to a sequence of bonds that mature at varying times over a specified period. The essence of having different maturity times for the bonds is to enable you to reduce your reinvestment risks.
But still, a bond ladder allows you to receive income passively at different times. If you are looking to secure your retirement future, a bond ladder may be your perfect vehicle. It allows you to sit back and wait to collect interests.
That’s not all. Once your bond matures, you can stretch your ladder. You can use proceedings from an already developed bond to buy another without getting into your pocket.
You can build a bond ladder on Fidelity or any other bank.
15. Invest In Property Crowdfunding (Real-Estate Crowdfunding)
Would you want to invest in real estate but are not comfortable with directly holding a property? Then you should consider property crowdfunding.
Here, you would loan your money to someone (a landlord) or an entity (a corporation) for them to buy a real estate property. In turn, they would pay you interests at regular intervals, which will mean a passive income stream.
Are you wondering how to make passive income online through property crowdfunding? Consider visiting these real estate crowdfunding platforms:
The advantage of real estate crowdfunding is that you can spread your investment across uncorrelated properties to reduce possible risks.
16. Rent Out Your Car To Make Passive Income
With peer-to-peer car-sharing platforms like TURO and GetAround, you no longer have to drive people around to make money. All you have to do is rent out your car via either service, and the vehicle will make money for you.
With the idea, you can expect some pay at the end of the month. Depending on location, your car can make you up to $1000 a month.
And if you rent out on GetAround, you’ll receive a $1million auto insurance coverage to secure your car against possible risks.
Plus, GetAround offers you a $50 credit every month to use to rent whatever car you like.
17. Rent Out An Extra Room To Make Passive Income
Most people prefer to rent spaces in actual homes as opposed to hotels and guest houses. For some, homes are cheaper, and for others, homes offer them an ambiance similar to what they are used to.
So, if you have an extra room or apartment that you hardly use, it is a lucrative idea to list it on Airbnb or VRBO for renting out. The two sites are perfect passive income opportunities for homeowners.
With most homeowners making $500-$1000 per room per month, you can never earn money easier than this way.
18. Rent Out Parking Or Storage Space To Make Passive Income
If you don’t have a spare room, but you have a spacious garage, a parking lot, or a store, consider renting it out. You can make up to $1000 a month passively with the idea.
All you have to do is list your space on a legit space renting website. You’ll need to indicate the space size and type, direction, and rates.
Here’s a quick guide:
- Parking space – Consider JustPark, Pavemint, SpotHero, Neighbor.com, or CurbFlip.
- Storage space – Consider Neighbor.com, StoreAtMyHouse, and StowIt.
19. Rent Out Personal Stuff To Make Passive Income
Now that the sharing economy is taking over the car and space renting sector and our lifestyle, the clutter at home could be money in waiting.
From tools and vintage furniture to camping supplies and baby gear, you can rent them online and make money passively.
Here are some ways to make passive income online renting out different things:
- BabyQuip – The website is perfect for renting out baby gears like strollers, baby car seats, and cribs.
- Fat Llama – The site is perfect for lending electronics, power tools, camping gears, and just about anything.
- Craigslist – Like Fat Llama, you can rent just about anything on Craigslist.
- Spinlister – The website is perfect for renting out bikes, ski equipment, snowboards, and surfboards.
- Loanables – The site is perfect for renting out games, sports gears, camping accessories, and other outdoor fun supplies.
20. Join The P2P Lending Community To Make Passive Income
Peer-to-peer (P2P) lending is an online lending system that allows lending and borrowing between friends and peers. Here, you can lend money to people and earn up to 7% interest per month.
All you have to do to earn an income is lend some money and wait for the borrower to pay back.
Of course, there are defaulters. So, they are a risk you have to take when you sign up as an investor.
Some of the best platforms to sign up as a P2P investor are:
More Ways To Make Passive Income
21. Sell Stock Images Online To Make Passive Income
If you are passionate about photography, you shouldn’t let your talent go to waste. All you have to do to make money is take a few stunning and inspiring photos and upload them on stock image sites.
One of the best is 500PX, where you receive 70% of every license that is sold. Some photographers make as much as $250 per license on-site.
Another place where you can earn passively by selling stock images is Shutterstock. You can make up to $100 per image download, and you receive a 20% commission from direct referrals.
You should also consider iStockphoto, where you can get up to 45% royalties.
Generally, selling images to stock photo sites is among the best ways to make passive income without investing much. You only need a good camera, which your smartphone can do.
22. Sell Music Online To Make Passive Income
The online market provides you with some fantastic opportunities for selling your music. You don’t have to struggle to find buyers as there are so many websites that act as middlemen.
In this case, they get a small commission for providing you with a platform to sell your records, and you get to keep the rest.
Here are three to consider:
- CD Baby – Only takes 9% of what you sell (digital copies).
- TuneCore – Allows you to keep 100% of sales, but you have to pay them a small fee (starting from $9.99) for the distribution.
- Bandcamp – Takes 15% of total music sales.
23. Get Paid to Advertise with Your Car
Imagine this – All you have to do to make passive income is to have your car promoting some ads.
You got that right. You don’t have to deliver anything or follow a specified route. We call it car wrapping, and it’s among the best passive income ideas for car owners.
Depending on the company, you can make $100-$2,400 monthly, and some of the best companies that pay you for car wrapping are:
24. Flip Domain Names Or Websites
Did you know that you cannot replicate a domain name? Once taken, the only way you can have it is by convincing the owner to sell it.
So, having a specific domain name may be a goldmine in waiting.
You can register as many domain names as you can and list them for sale on Flippa – which also allows you to flip (buy and sell) websites.
Once you have several domain names awaiting selling, people will be making inquiries. As for website flipping, the secret to selling high is first improving the site’s ranking.
25. Earn Cashback Online
If you do your shopping online, it’s about time you start getting refunds from purchases. I’m talking about using moneyback apps like Rakuten or Ibotta.
For instance, Rakuten partners with 2500 well-known retail stores like Amazon and Walmart and allows you to get up to 40% cashback.
What’s more, you receive a $10 welcome bonus for completing your first purchase worth $25. Rakuten also offers you a $25 bonus for referring a friend who makes purchases worth $25.
Ibotta, on the other hand, gives you up to a $20 welcome bonus just for signing up and using the app. With it, you can shop at Walmart, Best Buy, among many other stores.
Related:
Concluding Thoughts On Ways To Make Passive Income
Now you have 25 smart ways to make passive income. You can go ahead and decide on the idea that works for you. What you pick should earn you income passively to enable you to reach all your financial goals.
The best way for you is to sell advertising space on your car or just rent your car to other people.
To get started with passive income, it is important to research different options and choose the one that is best suited to your interests and financial goals. It may also be helpful to consult with a financial advisor or investment professional to ensure that you are making informed decisions.
