Exchanging time for money is the norm. Every day, people get up, go to work, clock in 8 hours or more, come home, and do it all over the next day. The end result? A paycheck. You put in the hours and the outcome is money in your bank account. This is how people are trained to make money. Passive income ideas are not even considered.
Traditional school systems stress the importance of a good education so you can get a good job. A good job means you can make more money. You work hard, and the money comes. While this is true, and doesn’t steer people wrong, it’s not the only way to make money.
Passive income doesn’t require you to exchange time for money. Passive income allows you to make money any time. Passive income may require an initial investment of time or money, but the results will keep producing a paycheck, long after the work is done. I’m sharing 7 passive income ideas to try if you want to expand your income sources.
Passive Income Ideas
Invest in stocks that give dividends
Investing in stocks, whether they pay dividends or not, is a great way to earn passive income. You put your investment in upfront (the amount you designate to purchase stocks) and let the magic happen. Over time, your initial investment will grow – historically at least! There’s no guarantee when it comes to investing.
No one knows the future, so you could invest and lose it all. However, that’s very unlikely. Historically, long-term investments yield 6-8% returns. You can take that up a notch by investing in stocks that pay dividends.
Dividend-paying stocks are paid out to investors in the form of cash. These payments typically come every quarter. You have the option to re-invest dividends or have them deposited straight to your bank account. Dividends have nothing to do with investment gains. They are simply a “thank you” to people who invest in that particular stock.
Switch to a high yield savings account
Think investing in stocks is too risky for you? Take the risk out of the equation by switching your regular savings account to a high yield savings account. There are plenty of online banks like Synchrony, American Express and Ally who all offer incredibly high interest rates on any amount in your savings. What’s even better is that these accounts rarely come with fees.
Unlike your standard savings accounts at banks like Wells Fargo, Chase, and Bank of America, who all have minimum balance requirements and monthly fees, high yield savings accounts don’t! You get more money paid to you in interest, just to keep your money in the account. The more money you have, the more interest you earn. This is one of the easiest ways to earn passive income.
Rent out a room or a house
Do you have a spare room that you never use? Rent it out! If you don’t want to deal with long-term renters, list it as a rental option on AirBnB! If you rent it out via a lease agreement, then you know you will have money coming in up until the lease ends. If you prefer to rent it out during special events or when you’re out of town, AirBnB and HomeAway are great options.
Rental income is a form of passive income, because you can receive money every month without much or any work. Of course, you run the risk of something breaking down, especially with a rental home, but those instances aren’t as consistent as the money that comes in. If you are renting a home that has a mortgage, renting it out for more than the mortgage leaves room for profit, and more money in your wallet!
Create and sell digital products
A digital product is an item that is created for digital use. Some examples of digital products include:
- Online courses
- Recorded audio and video
- Worksheets, guides and lesson plans
These products can be created online, sold online, and leveraged online by the purchaser. These products typically require an upfront investment of time and work, but once the product is created, it can be sold for years and years. That means, that one initial investment of time and work can product income forever.
If you are passionate or knowledgeable about a certain topic, package it up into an eBook, online course or online worksheet, and sell it. People are willing to pay for things they don’t know how to do – especially if they know it works for you.
Earn affiliate income from your blog
Blogging is another great way to earn money while you sleep. Blogs can earn advertising income (think Google AdSense), or affiliate income. Affiliate income can come in many forms. Companies can pay you to publish a link to their company on your blog. Companies can pay you to write an article about their company or products.
Affiliate income is simply a form of marketing. Companies pay you to help them spread the word. Payment can come in the form of cash, free goods, discounts and more. The more traffic you get to your blog, the more companies are willing to pay you to promote their stuff. Read How to Start a Money Making Blog if you are considering starting a blog.
Affiliate income is one of the ways City Girl Savings brings in additional revenue.
License your photos
Stock photography websites like Shutterstock, iStock Photo, Getty Images and Twenty20 sell stock photos to the general public. How does this work for you? These companies don’t take all of the stock photos themselves! They purchase the rights to the photos from photographers. Once the photos sell, the photographer receives an instant royalty.
If you take great pictures, submit them to stock photography websites. If your images are approved, the second they are downloaded from the stock photography site, you receive a payment.
Write a book
I touched on creating a digital book (eBook), but a physical book is also a form of passive income. Think about it – you write and publish the book once, but can receive royalties from the book forever. Once your book is available on a site like Amazon, you could receive a check each month as long as it sells.
Obviously, the more you market your book, the more sales you will get. This means you may have to put in some work, at least initially. Once your book is to a place where it can market itself, the checks will come rushing in.
Related: Why You Need Passive Income
If the average millionaire has 7 streams of income, then the rest of us better get to work! Earning passive income is a great way to bring in money while you have another source of income, like a day job. Trust me, you can’t beat the feeling of earning money while you sleep! Do you have any passive income revenue streams? Are you considering passive income? Share your passive income ideas and questions in the comments section below!