Passive income, as it may seem, is a way to passively make money; that is, to make money without putting a lot of effort into the process day after day. While this can seem like the perfect way to quit your 9-5 and live like a free man once again, it is not without its drawbacks. Many people misinterpret the term ‘passive income’ to mean little to no work for a large amount of gain. In reality, this is hardly the case.
Those who live off of passive income streams hardly ever have just one. They may have a successful blog, be invested in a multi-billion dollar company, and have a published eBook. Though all of these things bring in passive income, they took a lot of time and / or money at the beginning to get the ball rolling.
If you’re financially savvy or have a skill you want to share with others, you may be able to find yourself with multiple passive income streams in no time. Even if you’re not up for the challenges of maintaining a blog or renting out property, there are plenty of other passive income ideas you may be perfect for.
Before Starting, Keep This in Mind
Don’t expect to write a couple of blog posts and quit your day job. Passive income starts off slowly. So slowly, in fact, that you may think this idea was a horrible one after all. If you have the patience and the desire to succeed, the results will come. But when thinking about creating a steady stream of income, you should keep in mind that it may take several years to start showing progress.
Don’t put all your eggs in one basket! If you invest every last penny you have into one specific company and they crumble, you have lost all of your money. You should never spend more money than you can bear to part with, and you should always consider having multiple strings of passive income at once. You are not guaranteed a profit from any of them, so if one fails you know that you have a couple more to fall back on.
Passive income is truly for the dedicated. If you don’t put any effort in to begin with, you won’t gather much profit in the long run. Consider your strengths and your weaknesses, and then determine which path to passive income is right for you.
The Pros and Cons
While passive income may seem like a walk in the park after a while, the path to success is far too difficult for some. You should consider both the pros and cons before jumping right into a potential stream of passive income.
- If your passive income streams are successful enough, you really could end up quitting your day job. Think about how much extra time you’d have to take up knitting, travel the world and spend more time with those you love! If you’re dedicated enough to get out of that office cubicle, there are ways to succeed.
- Multiple streams of small income could add up to a lot. Maybe you’re updating a blog once a month, selling old crafts on Etsy, and have a small investment in a start-up company. While each of these things individually may not bring in large amounts of cash, all of them together can add up to a significant amount of money in the long run.
- You never know what’s going to happen. When you work 9-5 every day, you know that you’re going into work, getting everything finished that needs to be accomplished, and are going to be paid for that day of work. You have financial security, even if you have to slave away for it. With passive streams of income, you never know what’s going to happen. What can be a successful website one day can become old news the next. You always need to be prepared for failure, both emotionally and financially.
A Wide Range of Opportunities
If the uncertainty of passive income isn’t enough do dissuade you from the opportunity, there are a ton of different opportunities out there for creating streams of passive income, whether they’re exponentially big or fairly insignificant.
Write an eBook
As much as I hate to admit it, paper books are becoming a thing of the past. The rise of iPads and Kindles make it all too easy to purchase a book and download it right to the palm of our hand; no trip to the bookstore necessary. Because of this, more and more authors are transitioning to eBooks. If you make a quick search about virtually any topic, chances are an eBook on this topic will pop up. Do you have a lot of knowledge on caring for cats, taking care of an organic garden or fixing up old cars? Transfer all of that knowledge to an eBook and those with a thirst for that knowledge will purchase it. Once your book is published, every purchase made afterwards will add to your stream of income.
Create a website or blog
Coming up with blog ideas day after day can be tough, especially if you’re not focused on one particular topic. The trick to website or blog success is to determine which niche you are most interested in and have the most knowledge in. If your website becomes a ‘niche webiste’, you’ll attract a lot of people who are interested in that particular subject. But coming up with the topic can be difficult; if you choose a popular topic, such as eating healthy, you may attract a lot of people but you may also be competing with a lot of other websites. If you choose a more obscure topic, such as fish taxidermy, you won’t be competing with a lot of other websites but you also won’t attract as many viewers.
If you’ve been working on your website for a while and it has been fairly successful, you may want to look into affiliate marketing for an extra stream of income. Let’s say your website is all about how to look fresh and rejuvenated, day after day. It is geared towards women who want to use light, natural looking makeup to accentuate their features but not obscure them. If you attract a lot of visitors a month, you can team up with a company to promote their product through your website. Every time someone clicks the link on your website and purchases a product, you get a percentage of the profits.
While this requires a lot of funds to get rolling – you’ll actually have to buy a property and pay it off – once you own it you can rent it out for much more than you paid for it in the first place. When renting out property, you get monthly checks from anyone who is renting out the space. After a while, it will more than pay for itself. This form of passive income does not come without any obligations, however; you’ll need to make sure the property is properly maintained and will have to be in contact with the tenants who are living there, but it’s much less work than having a full-time job.
Are you shutter happy? Have you ever seen a stock photograph and thought “I could have taken that”? There are hundreds of thousands of photographers who license their images through various websites every single day. An image taken 10 years ago can still be making you money for the next 10 years. Once you license a photograph, every time someone purchases the rights to use that photograph you get a chunk of the profits.
Designing Website Templates
If you’re a master of HTML and CSS, you’re in luck. There are so many people these days with websites and blogs that don’t know a thing about the building blocks behind them. If you make a quick Google search you’ll find tons of websites that are selling pre-made website templates, WordPress templates, you name it. If you can create one that will outlast varying trends (minimalistic themes are always a great idea), you can sell it for a profit.
If you have a ton of knowledge on one particular subject but eBooks and websites don’t appeal to you, creating an online course may be a wonderful alternative. As opposed to being an actual teacher that has to grade homework and tests and answer questions from students, you can simply set up an entire online class that automatically grades any tests that the students take. If you choose a topic that a lot of people are interested in these days – website and app development are some big ones – you can receive a chunk of money every time a student signs up for your class.
There are many different ways to create passive income streams if you know where to look. Whether you have extensive knowledge on a particular niche or you’re more of an investor, stock market type, there’s a stream of passive income out there just waiting for you to grab a hold of it. If you have the patience and the determination, you can start earning extra money every month. There are a ton of resources out there if you know where to look, so start taking advantage of them!
If you’re ready to get started, Udemy has a great course that will help you learn how to make passive income right from your computer!