Almost anyone can benefit from generating passive income. Whether you’re a recent graduate just starting in your career, a stay-at-home mom looking to supplement your family’s income, or a retiree hoping to supplement your retirement savings, there are plenty of opportunities for generating passive income. And the best part? Passive income investment requires very little hands-on work once you get started.

There are many ways to create passive income, and this article will explore ten of the most popular options. But before we dive into those options, let’s take a quick look at passive income and why it’s such an attractive proposition.

What is Passive Income?

Essentially, passive income is money you make without putting in any much active effort. This type of income can come from a variety of sources.

There are a few different ways to generate passive income, but the most common methods involve investing in real estate or generating income from an existing business.

Why Is Passive Income So Attractive?

There are several reasons why passive income is such an attractive proposition. First of all, it allows you to free up your time. For example, if you’re generating passive income from a rental property, you don’t have to spend time managing tenants or dealing with repair issues.

Secondly, passive income is a great way to generate additional income without major lifestyle changes. If you’re looking for a way to supplement your current income, generate passive income from one of the options below.

And finally, passive income is a great way to build wealth over time. If you reinvest your passive income earnings, you can compound your returns and build wealth more quickly.

10 Passive Income Investment Ideas

Rental Properties

One of the most popular ways to generate passive income is to invest in rental properties. You can earn regular income by purchasing a property and renting it out without putting in any active work. In fact, according to the IRS, nearly 10.6 million people in the U.S. earn income from about 17.7 million rental properties.

There are a few things to keep in mind if you’re thinking about investing in rental properties:

1. You’ll need to have a down payment for the property.
2. You’ll need to factor in the cost of repairs and maintenance.
3. You’ll need to be prepared for vacancy periods when the property is not rented out.

Despite these considerations, investing in rental properties can be a great way to generate passive income. If you purchase a property in an area with high demand, you can earn a substantial return on your investment.

According to Jim Pendergast, Senior Vice President of altLINE Sobanco, “Income producing real estate is still the best performing asset class over the last 100 years.”

REITs

Another popular option for generating passive income is to invest in real estate investment trusts (REITs). REITs are businesses that operate, finance or own real estate that produces income.

By investing in a REIT, you can earn dividends from the underlying real estate assets. REITs are a great way to generate passive income, but they come with some risks. REITs are subject to changes in the real estate market, and their divid/end payments can fluctuate.

Still, REITs can be a great way to diversify your investment portfolio and earn passive income. So if you’re considering investing in a REIT, research and choose a trust with a solid track record.

Peer-to-Peer Lending

Peer-to-peer lending is a type of investment that allows you to earn interest on your capital by lending it to borrowers.

According to Allied Market Research, the peer-to-peer lending market is projected to reach $558.91 billion by 2027 at a CAGR of 29.7%.

You can earn a higher return with peer-to-peer lending than with a traditional investment. This is because you’re taking on more risk by lending to borrowers who may not be able to repay their loans.

Still, peer-to-peer lending can be a great way to generate passive income. If you’re considering this type of investment, be sure to do your research and choose a reputable lending platform.

Anthony Martin, Founder and CEO at Choice Mutual, says, “Peer-to-peer lending is a great way to earn passive income, but it’s important to choose a platform with a solid track record.”

Dividend Stocks

Another great way to generate passive income is to invest in dividend stocks. Dividend stocks are stocks that pay out regular dividends to shareholders.

Investing in dividend stocks means earning income without selling your shares. This means you can continue holding the stock and benefit from future price appreciation.

However, it’s important to remember that dividend stocks are subject to the same risks as any other stock. Before you invest, be sure to do your research and choose a reputable company.

According to Shawn Plummer, CEO of The Annuity Expert, “Investing in dividend stocks is one of the smartest things an investor can do. You get paid to own a stock, regardless of whether the stock price goes up or down.”

Bonds

Bonds are another option for generating passive income. When you invest in bonds, you lend money to a government or corporation. In return, you’ll receive regular interest payments.

Bonds are a relatively safe investment, but they come with some risk. The interest payments on bonds are subject to change, and the value of bonds can fluctuate.

Still, bonds can be a great way to generate passive income. Bonds may be a good option if you’re looking for a safe investment with regular income payments. You can purchase bonds through a broker or online platform to get started.

According to Bankruptcy Canada Inc., “Bonds are a great way to generate passive income. They’re safe and reliable, and you can get started with as little as $100.”

Affiliate Income

Affiliate income is a type of passive income that you can earn by promoting products and services on your website or blog.

When you include affiliate links on your site, you’ll earn a commission whenever someone clicks on the link and makes a purchase. The amount of money you can earn depends on the products you promote and the traffic you generate.

For example, if you have a blog about travel, you could promote travel-related products and earn a commission on every sale. You could make a significant passive income from affiliate marketing if you have a large audience.

To get started, you can sign up for an affiliate program and start promoting products on your site.

Bonus tip: If you would like to maximize your affiliate earnings, consider joining a few referral programs as well. A perfect fit for this category would be the passive income app Honeygain and its referral program, where you can get continuous passive income from each person you bring. 

Selling eBooks and Courses

If you have expertise in a particular topic, you can create an eBook or course and sell it online. This is a great way to generate passive income because you can continue selling the eBook or course for years.

To get started, you’ll need to create the eBook or course and choose a platform to sell it on. Once you’ve done that, you can start promoting the eBook or course and earn passive income. You can sell eBooks and courses on your own website or platforms like Amazon Kindle Direct Publishing.

One thing to be aware of is that creating a high-quality eBook or course can take some time and effort. That being said, if you’re able to create a successful product, it can be a great way to generate passive income.

Chelsea Cohen, Co-Founder of SoStocked, says, “Selling eBooks and courses is a great way to generate passive income because you can continue to sell the eBook or course for years to come.”

Creating a Membership Site

Another great way to generate passive income is to create a membership site. You can charge people a monthly fee to access exclusive content or features with a membership site.

For example, you could create a membership site with exclusive content for travel enthusiasts. Or, you could create a cooking membership site with access to exclusive recipes and videos.

Creating a membership site is a great way to generate passive income because you can continue to earn money as long as people are willing to pay for the membership. However, you should consider carefully how much content you’ll need to create and how much you can charge for the membership before getting started.

Building an Email List

Few know that you can generate passive income by building an email list. With an extensive email list, you can sell products or services to your subscribers and earn a commission on every sale.

To get started, you’ll need to create an email list and promote products or services your subscribers will be interested in. Once you’ve built up an extensive email list, you can start earning passive income.

One thing to remember is that building up an extensive email list can take some time. You’ll need to be patient and continue growing your list over time to start generating passive income. Also, you’ll have to be aware of spam laws to avoid legal penalties. Finally, you don’t want to risk your hard-earned passive income.

Selling Stock Photos

Finally, did you know you can earn passive income by selling stock photos? You can start selling your photos online if you have a DSLR camera or a smartphone with a good camera.

There are multiple stock photo websites that you can choose from, such as Shutterstock and iStockPhoto. Once you sign up for a website, you can start selling your photos and earn a commission on every sale.

This is a great way to generate passive income because you can continue selling your photos for years. Plus, you can sell your photos on multiple stock photo websites, which will help you to earn even more money.

Conclusion

So there are ten passive income ideas you can use to make money. While some of these ideas may require more work than others, they all have the potential to generate passive income. So if you’re looking for ways to make extra money, consider implementing one or more of these ideas.

Bio:

Nate Tsang is a serial entrepreneur, part-time investor, and founder of WallStreetZen.