Why Passive Income is Important
Why passive income? Because passive income is one of the most important things in life that you should really consider! Passive income streams are essential for all who are dreaming of financial freedom. If you couldn’t finish school or study further, that is okay. But the passive income concept is something you can’t skip!
Your passive income hunt starts here! Because building passive income takes time, persistence, and dedication. We don’t even try to prove that getting passive income is easy. Instead, we try to help you on your journey to start a challenging task and make it as smooth as possible. Use this list as an awakening of inspiration. Generally speaking, the following rule is fundamental for everyone around the world. There is no free lunch. The same goes for passive income. There is no free and easy way to get passive income! Don’t just jump into any passive income idea; instead, do some research and find the best one for you.
We gathered this list for you so that you can get inspiration and do some dream catching. Check out our list and consider the ones that would fit your skills, needs, and personality. With the shortlist, you can decide on the one idea to try with a good strategy. If you fail, it doesn’t matter. Try again! But don’t quit before trying.
Please remember not just to pick something that sounds nice. We recommend you pick one based on your own needs, skills and personality. Choose the one that you are really interested in. Something that inspires you! Then do more research about it, make a master plan, set goals, start executing your plan and don’t give up easily!
How To Get Passive Income
The method you get passive income doesn’t matter at the end of the day. Passive income is passive income, simple as that. However, you must understand the basic principles behind typical passive income. In general, you can generate passive income in one of four main ways:
- Investing: When you invest, you put your money to work for you. Think about investing in a company that pays dividends quarterly (Apple, Coca-Cola, Walmart, etc.).
- Asset building: This means owning an asset that earns money passively. Think about a YouTube channel that generates income from advertisements on already created videos.
- Asset sharing: In this sense, asset sharing means selling or renting out assets you already own. For example, renting out your beach house on Airbnb.
- Entrepreneurship as a passive income tool: If you can establish a successful business that runs independently without active management. For example, if you can automate a task that provides so much value that people are willing to buy it as a service from a freelancing platform such as Fiverr. This is an excellent opportunity if you are low on money or assets.
Okay, now that we understand the basics, let’s look at different passive income ideas that could help you on your financial freedom journey. We have separated ideas into different categories to make your life easier. How? Well, let’s say that you love the digital world. You should consider passive income ideas based on the digital world. If you hate computers and digitalisation, maybe it is smart to skip that category.
Digital World Passive Income Ideas
These ideas are heavily based on the digital world. The good news is that digital passive income ideas are often very scalable. Meaning that if you can hit success, only the sky is the limit. In theory, the whole world is your market area.
- Affiliate marketing
- Automate services commonly sold on Fiverr (Backlink building, image background removing, etc.)
- Sell an online course
- Sell an ebook
- Start a YouTube channel and profit via advertisements
- Start a blog and profit via advertisement
- Dropshipping store
- Create or buy a profitable app
- Create or buy a profitable website
- Cryptocurrency mining
- Run a subscription-based service
- Sell Software as a Service (e.g. open-source software)
- Establish digital tool website and profit via Google ads
- Sell products on eBay
- Sell products on Amazon
- Sell print on demand shirts
- Start TikTok influencing and sell shoutouts once you have a big audience
- Start Instagram influencing and sell shoutouts once you have a big audience
Real Estate Passive Income Ideas
Do you think you could fit in the landlord category? If yes, then this one is for you! Seriously speaking, you don’t have to be a landlord to profit from real estate. One of the simplest ways is to buy a service that will take care of the whole rental process, and you can simply focus on finding profitable real estate opportunities.
- Own rental properties and get rental income (beach house, condo, residential house, garage, parking space, etc.)
- Rent out a room via Airbnb
- House flipping (buy a house, do a renovation and sell the house)
Stock Market Passive Income Ideas
If following stock market trends and watching The Wolf of Wall Street interests you, then this category is the perfect match for you! Stocks and funds are fantastic opportunities for passive income generation. Do yourself a favor and check out the stock market passive income ideas!
- Invest in dividend stocks
- Dividends are stock-related payments that a company makes to its shareholders regularly. You invest in a company by buying their stock and receiving dividends, which usually are paid quarterly in cash. You can learn more about what dividends are by watching our YouTube video.
- Read this article about the S&P 500’s Dividend Aristocrats to learn more about exclusive dividend stock.
- An informative book to read is “Get Rich With Dividends: A Proven System For Earning Double-Digit Returns” by Marc Lichtenfeld
- Invest in Real Estate Investment Trusts (REITs)
- A real estate investment trust (REIT) is a publicly-traded company that owns, manages, or finances income-producing real estate, making it possible to pay dividends to investors.
- REITs may sound complex, but this article will help you understand everything about REITs.
- If you’d like to learn more about REITs, consider reading “Investing in REITs: Real Estate Investment Trusts” by Ralph L. Block.
- The secret to dividend stocks and earning a passive income is to hold stock long term. Remember, Rome wasn’t built in a day!
- It’s also recommended to hold ETFs or Mutual Funds long term.
Entrepreneur Based Passive Income Ideas
- Rent out your car
- Put ads on your car
- Sell advertisement space in your backyard (if you live near a public street)
- Write a book
- Record and publish songs
- Publish any material with copyright (and sell the license to it)
Do I Need To Work To Get Passive Income?
Yes, you must work to get passive income. There are no exceptions to this. Even if you inherit a lot of money, you must work by evaluating who you can trust or where to invest smartly.
Income is passive if you don’t have to 100% trade your own time to cash. Suppose you have a dropshipping store that brings $1,000 each month without any effort. To achieve a state of passive income, you had first to establish the dropshipping store and allocate a lot of time and effort before you could reach $1,000 income each month.
Does Passive Income Stream Mean It Is Passive Forever?
No, a passive income stream doesn’t guarantee passive income forever! Some of the previous ideas could potentially provide around “99% passive income” for life. However, many don’t provide that luxury. And that is fine! The key factor here is that we all have only 24 hours per day and a limited lifetime. We need income streams that “multiply our time”, where the income doesn’t always require active management.
One of the most crucial aspects of a healthy financial position is passive income. There are only advantages to generating passive income, ranging from boosting financial security to reducing financial stress.
What are you waiting for? This is a question you should be asking yourself! In the not-too-distant future, you could be making money while you’re asleep! Are you going to say no to that?