What is Passive Income?
Passive Income is something that you can generate with little to no effort. It doesn’t require significant time or labor, so it is something that you can do while working in a full-time job or pursuing your studies. Passive income can be a way of reaching your financial independence and early retirement goals. This concept is getting popular, and many people are seeking ways to generate passive income for obvious reasons. Some examples of passive income could be earnings from renting your property, earnings from your blog, dividend from stocks, etc.
Benefits of Having Passive Income
- Passive income helps you generate additional cash flow that helps you lead a better life especially as inflation is raging throughout the economy.
- It ensures you have money coming in while pursuing your full-time job/study without investing a significant effort or investment.
- Having multiple streams of income gives you an extra security
- Lets you live and work from anywhere
Best Passive Income Ideas
While some of the passive income ideas might require a significant amount of investment, many other practical ways require little to no investment. We will largely focus on those. Sounds good? Let’s jump in.
1. Start freelancing
Freelancing can be a great way to start earning online. If you are a content writer, administrative assistant, graphic designer, video editor, teacher, digital marketer, developer, or possess any other skills, you can market these skills online on various platforms and find clients who need your service. There are many websites like Fiverr, Freelancer, Upwork, Toptal, etc. where you can showcase your skills, and portfolio and find clients.
Quick tips:
- You will probably not get paid from day one, so patience is important.
- Build a strong portfolio to establish your credibility
- In the initial days, you will need to offer your services at cheaper rates to attract clients. Once you have built a strong portfolio you can reach out to potential big clients to earn more money
- Improve your writing and communication skills. Personalized emails, on-point proposals, and professional communication will help you impress your clients.
- Get online courses and read about the skill you are planning to monetize
2. Start a blog
If you are passionate about something and love writing, starting a blog is a proven way to share your content with a larger audience and generate income. You can choose a popular subject, even a small niche, and become an expert on it. Once you have significant engagement in your blog, you can earn a decent income through advertisement and affiliate marketing.
Quick tips:
- The first step is to choose the right topic for your blog. It can be a popular topic or niche that you are passionate about.
- Whatever subject or niche you choose for your blog, make sure it interests you. Else you will lose the motivation to continue writing content in the long term
- Try to come up with engaging and informative content regularly that your audience would love to read. This can take time
- As you stay consistent and get more engagement, you can use your blog to drive other passive income sources like offering online courses, consulting services, and selling digital assets you have created, etc.
3. Publish an ebook
If writing is your forte, this can be a great option considering the low cost of publishing nowadays. Through Amazon’s Kindle Direct Publishing platform, you can publish your ebook with a few clicks of your mouse and leverage the worldwide distribution of Amazon to get your book seen by potentially millions of would-be buyers. Your e-books do not need to be long, perhaps 30-50 pages will do just fine.
4. Sell photography online
Stock photos are used for all sorts of reasons by websites, companies, blogs, and more. Businesses need stock photos because they are not usually in the business of taking photos of everything that they need. Instead, they can use stock photos to make their content, website, or business more visually appealing. You can upload your images to stock photography websites like Adobe Stock, Canva, Depositphotos, Shutterstock, etc, and receive a commission every time someone purchases one of them.
5. Dividend from stocks
Many of you must be familiar with the stock market. As public companies generate profit, a portion of that profit is paid back to the investor in the form of a dividend. Keep in mind, not all companies pay a dividend. Also, dividend yields can vary from company to company and fluctuate every year based on financial performance.
Companies with a good track record of paying a dividend (US Market) :
- AT&T (T)
- Exxon Mobil (XOM)
- Walgreens Boots Alliance (WBA)
- AbbVie (ABBV)
- IBM (IBM)
- 3M (MMM)
- Caterpillar (CAT)
Companies with a good track record of paying a dividend (Indian Market) :
- Britannia Industries
- Balkrishna Industries
- Punjab National Bank
- Dalmia Bharat
- Polycab India
- Dr Lal Pathlabs
- Nestle India
- Indian Hotels Company
Please do your research before investing in any company.
6. Crypto staking
If you are already holding crypto or planning to, you can stake your crypto holding to generate passive income. staking is a way of earning rewards for holding certain cryptocurrencies like bitcoin, DOT, Ethereum, Polygon, Tezos, etc. Most of the popular crypto exchanges now offer this service. Once you stake your crypto for a certain lock-in period, you get an annual percentage yield (APY) that can range anywhere between 4% to 10%
7. Build an app
We now use an app for almost everything. If you are familiar with programming and understand the technicalities involved, building your app and placing it in the play store or apple store could be a great idea. Try to come up with some cool and innovative ideas for your app. Just remember, you don’t need to be an expert to build an app. Even non-coders can develop an app with the right tools.
7 Best Free App Building Platforms If You’re Not a Coder :
- Andromo
- AppsGeyser
- AppMakr
- Bubble
- Appy Pie
- Appery
- Swiftic
8. Affiliate Marketing
If you already have significant followers on social media or own a website with decent traffic, you can make money through affiliate marketing. In this strategy, you make money by referring people to the products they need. Every time your visitors click the link and make a purchase, you get a portion of the sale as a commission.
Quick tips :
- Create a Content-Rich Website where you get regular targeted visitors
- Join affiliate programs that are relevant to your audience
- Promote products that people are actively searching to buy or offer high affiliate commissions
- Focus on providing value to your readers, or else your recommendations will not be taken seriously
- Don’t go beyond 30% of affiliate marketing content. Actual informational content should cover 70% or more
9. Starting a cloud kitchen business
Cloud kitchen is another great option for those who love cooking and planning to do business out of that. The main advantage of this is that you don’t need a lot of investment which you require to start a restaurant. Once you have the basic licenses to start a business, you can start preparing food in your kitchen itself. As you grow your business you can rent a place to scale up. You can tie up with online food delivery services like Swiggy, and Zomato who will handle the delivery process on your behalf.
10. Renting out your property
If you have real estate property like a flat, apartment, office space, parking space, or land, you can rent it out to earn some money every month. Depending on the location, you can get the rent. If you have the capacity, you can strategically purchase real estate property and rent it out for regular income.
Hope you find some useful methods here and take inspiration from them. Do let me know your thoughts and suggestions. Good luck and happy finance.
