Those of us wanting to live and work outside the box and do something over and above our 9-to-5 (or leave our 9-to-5 altogether) dream of a life where passive income streams can fund our expenses and leave us with hours of free time to do the things that we love and be with the people we want to be with.
By choosing the right source or sources of passive income for you and your family, you can spend your time the way you want to spend it instead of the way you “have to” spend it.
Here are 24 ideas that might work for you.
1. Invest in Crowdfunded Real Estate
Real estate is a great way to make money while you sleep. Because it costs so much to purchase a home, using a crowdfunding platform to buy real estate is a more affordable approach. If you want an easy, low cost way to invest in real estate, consider using a company like Fundrise. They had over a 13% return in 2015 as well as they have a very low investment requirement to get started.
2. Product Design
Another way you can make passive income is by designing t-shirts and other products. Companies like CafePress allow you to upload your witty design ideas to their site and create t-shirts, coffee mugs, laptop covers and a host of other products. Shoppers then visit the site, peruse your vast array of products, and when they purchase one of your designs, CafePress will pay you a portion of the profits.
3. Peer-to-Peer Lending
P2P Lending has become a hot investment opportunity in recent years. With ROIs often in the 6-10% range after defaults, socking 10k or more into a peer-to-peer lending company such as Lending Club can net much higher income results than a typical savings or money market account. It might be worth your while to do some research on this popular passive income source.
4. Bond/CD Laddering
Bond and CD laddering involves owning several different bonds and/or Certificates of Deposit that mature at several different times during the year, and taking the profits from those investments as cash income during the year. Although many CDs and bonds might not earn as much of a return as a Peer to Peer lending investment, bonds and CDs also generally come with little to no risk, ensuring a solid income source on a regular basis. If this is a route that interests you, check out Discover Bank as they are paying over 1% for just their savings accounts.
5. Shopping via Ebates
You have to shop anyway, so why not use Ebates to get a cash back refund on things you’d normally buy in the first place? With their double cash back specials, you can double your passive income earnings if the right items are on sale. The key to earning successful passive income with shopping sites is to commit to buying only what you’d buy otherwise from other source, and to ensure you’re paying a competitive price on the products you buy.
6. Writing/selling e-books or regular books
Once the initial work of creating the book is done, and you’ve spent some time developing an effective marketing plan, selling books can be a great way to produce some serious residual income. My daughter and I both have books available for sale on Amazon and each month we get a check from Amazon for doing absolutely nothing. Obviously, the more time you spend marketing your books, the more money you’ll make. If you’ve got great writing skills and an idea for a book that will bring value to readers, consider delving into this sweet passive income source.
7. Get out of debt
The less money you’re paying in interest to creditors, the more money you have in your pocket each month. Talk about a simple form of passive income. Get out of debt quickly, and then increase your income even more by investing the money you’re no longer paying to creditors each month. Have high interest debt that you want to get a lower interest rate on? Go to SoFi to get a $100 cash back if you refinance your credit card debt.
8. Affiliate marketing & Ads
If you have a website already than this is a no brainer. There are people that are making over $50,000 per month like Michelle who created Making Sense of Affiliate Marketing. By producing valuable content and working to reach a wide audience, readers will automatically produce income for you by clicking on ads from and buying products via your affiliate product links. If you want to make money from Ads on your site, check out Media.net as they tend to pay out higher than Adsense. Also, once your blog increases in popularity, bigger companies will approach you about sponsorship opportunities, which can also create passive income from your blog.
9. Dividend income
Dividend income is dividends paid to shareholders of publicly traded stocks or mutual funds in the form of cash, stocks or properties. Dividend paying stocks that pay cash are especially enticing for those wishing to make a living with passive income, as they ensure a check in the mail each quarter or so, provided the company continues to do well. Even Warren Buffet loves to dabble in dividend paying stocks. Provided you educate yourself and pick solid stocks and/or mutual funds, dividend income can be a great source of passive income. If you dont have an investment account, you can start one with TradeKing and I love them because trades are only $4.95.
10. App/software creation
If you know how to create computer software programs or applications, and can come up with some unique ideas for mobile apps or software that will help people make their work lives and/or home lives run more efficiently, you’ve just found yourself a passive income source. Every app on your phone is making money for somebody, somewhere. Get in on the game and use your technical smarts to create a new app or software program that will benefit the masses and make you some recurring income in the process.
11. Create an online course
Online courses are a great source of passive income. Here’s how they work: you create an awesome and highly beneficial online course that helps people with any number of issues. This course can include videos, e-books and emails with pertinent information. Customers sign up to purchase the course, and your system automatically emails them everything they need to access the course. You get money for the price of the course you created and today’s computer automation does all of the work. Ba-da-bing, ba-da-boom: money in your pocket. Need some inspiration? Take a look at my very own online course called Debt Free in 18 Months.
12. Create YouTube videos
Entrepreneurs everywhere are making money on YouTube by utilizing their video creation with ads in place. Each time someone watches a video you create, you earn money from YouTube. The key to success with this type of passive income source is to create videos that are helpful, such as instructional videos, entertaining and fun, or both. Although this can take a lot of time up front, once the video is live there is not much you need to do. Granted you probably will not make a living off of just a few videos, so be prepared to make over 100 videos if you really want this to take off.
13. Rent out a room in your house
Do you have an extra room that you never use? Why not rent it to someone looking for a short-term rental on AirbNb. There are millions of people using Airbnb to find a place to stay instead of staying at a hotel, sometimes even for months at a time. While this is not entirely passive income, it can take a little up front work but the return is pretty amazing. You could even consider getting a maid service to minimize the amount of time you spend on transitioning from one guest to another.
14. Buy a vending machine business
A successful vending machine business can be a great way to make passive income. The key is to find the right places to install your vending machines. Check with smaller brick and mortar businesses that have over 100 workers in the building on a daily basis, and see if they have a need for vending machine services. Another key to vending machine success? Ask those workers what items they prefer to have in the vending machine and then stock accordingly. Once again, is you want to reduce the amount of time that you are involved, consider hiring someone to stock the machines for you.
15. Photo/illustration licensing
Got a knack for taking pictures or drawing amusing and useful illustrations? If so, partner up with a company such as istockphoto.com and send them your pictures and illustrations. Each time one of their clients downloads one of your pictures or illustrations, you get a royalty payment.
16. Start a business and have someone else run it
Owning a business can be a good passive income source, provided you’ve got the right people running the business for you. Whether it be through the purchase of an existing business or opening a new business, your great business idea can be a viable source of passive income.
17. Rent your car for ad space
By allowing companies to place ad wraps on your car windows, you can earn a few hundred dollars each month simply by driving your car as you normally would. Companies such as Free Car Media can show you how you might be able to make passive income by wrapping your car with ads.
18. Buy an existing online business
Online businesses are for sale everywhere. Websites such as Biz Buy Sell have hundreds of current online business listings that are currently for sale in all different prices ranges. Check with these and other sites to see if there is an online business for sale that might appeal to you.
19. Buy a laundromat
Here’s another turnkey passive income business. Many urban and suburban areas have established laundromats that are available for sale. You buy the already existing business, make sure you have someone to manage the day-today operations, and watch the profits roll in.
20. Open a batting cage facility
I am stunned at the lack of batting cage facilities are in this area. Baseball is one of the most popular sports for kids all over America, yet, at least in my bigger metro area, only a handful of batting cages can be found. This is one area where there is a need in many cities.
21. Open a high-yield checking/savings account
Looking for a super safe form of passive income? Open a high-yield checking, savings or money market account with a bank like EverBank. The yields are much higher than most local banks, but still come with FDIC insurance.
22. Try your hand at house or pet sitting
Most house sitting jobs are highly passive income opportunities. You have to live and sleep somewhere: why not get paid to live and sleep at someone else’s house or pet sit while they’re away on vacation or at an extended work project out of town? Provided there’s no unreasonable or out-of-the-ordinary housekeeping or home maintenance expectations, house or pet sitting can be a terrific form of passive income. Check out Care.com where you can list your services for free.
23. Start a drop shipping business
Drop shipping is a neat little form of passive income that many people aren’t familiar with. Here’s how it works: you create an e-store front that offers products from certain manufacturers. The client visits your “store”, orders a product, and your system sends the order to the specific manufacturer. The manufacturer then completes the order by shipping it to your client. You don’t send the money to the manufacturer until after the client has paid you. If you’re interested in the possibility of starting a drop shipping business, consider using a platform like BigCommerce to build your online store.
24. Rent your stuff
Thousands of people every day are looking to rent any variety of “stuff”. In the last year alone, we’ve rented a pressure washer, a power sprayer for paint, a truck for hauling stuff, a trailer to haul our horses, and numerous other items. Search your home and garage for things that you have but use infrequently, and consider advertising to rent them out on Craigslist. Some other products you could rent out: Extension ladders, party tents, tables and chairs, utility trailers, log splitters, chainsaws, snowmobiles, ATVs and so on. Just make sure to have a proper rental agreement signed by both parties, get paid in cash beforehand, and get a current photo ID and secondary proof of address in order to protect the property you’re renting out.
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