Top 5 Passive Income Ideas To Make More Money This Year
Is passive income just a dream? Or is it something you can actually attain? With so little time in your day, how do create an income that will pay you passively? And how do you generate enough of that income to eventually quit that life-sucking job that depletes you of all your energy and passion for life?
Look. I get it. Life isn’t easy. It’s hard work. It’s a grind to get up every single day and go to a job you hate just to make enough money to pay the bills. So you’ve been searching for ways to break free of the rat race. You see people all over the place getting rich like this guy, or this guy, and this one. But let me tell you this word of caution. Passive income is not easy.
When it comes to making money online (or offline), passive income requires the most effort and time with zero return in the beginning. That means you need to work for months (if not years) at full tilt with very little to show for it. I don’t say that to scare you. I say that to bring awareness that it will be a long, hard road.
But let’s look at the flip side. You can keep going to that life-sucking 9-to-5 job and years down the road you’ll wish you started today. So why not grab hold of the reigns of life and start now? You know the saying right? The best time to plant a tree was twenty years ago, the second best time is now.
That Chinese proverb is popular for a reason. It’s because no matter what you want out of life, the best time to start is now. I have a friend who lives by the motto, “the time is now” for a very specific reason.
What Is Passive Income
First, let’s take a step back and look at this. What is passive income? And just how does it work? By definition, passive income is made passively. That means it happens on autopilot without that much effort. But creating passive income streams requires a lot of work.
This is very different from active income. Active income is what most people are used to. That’s where you work for several hours or days and are paid for that work. The big difference is that when you’re not working you’re not earning an active income.
Passive income takes a long time to create. But it does keep paying you repeatedly. That doesn’t mean you should only have passive income. But having passive income is a great addition to an active income. It gives you more freedom and money. It also puts your mind at ease knowing that if something ever happens with your day job, you’re good.
Most people work on passive income while they have an active income. Otherwise, it’s hard to pay the bills. Unless you have no bills and no overhead, passive income is always the clear winner. Now that you understand what it is, let’s run through some of the best ideas for creating a passive income stream to make more money this year.
#1—Rental Income
It’s no secret that rental income is one of the best passive income ideas out there. However, rental income comes in lots of different shapes and sizes. So I wanted to break this down to create some clarity. You can generate passive income through real estate in a few different ways. Not all of these are fully passive.
Purchasing Rental Properties
When most people think about passive rental income they think about buying rental properties. This can be single-family homes, duplexes, triplexes, multi-family homes, townhomes, condos, you name it. In the United States, there are serious tax benefits to owning rental real estate and even more for owning multi-family properties.
However, most people are afraid to buy rental properties. They either think they don’t have enough of a down payment, have bad credit, or won’t qualify for the loan for some other reason. There are so many loan options such as Debt Service Coverage Ratio (DSC) loans that give loans based on the rental income of the property.
There are also many ways to purchase real estate using the “subject to financing” method that allows you to take over an existing mortgage. You can also make money by wholesaling real estate by finding distressed homes and then flipping the paper to cash buyers.
Vacation Rental Management
You can make somewhat passive income through real estate by managing rental properties for other people. It takes a lot of time to set up and get all the systems in place. But once you have your well-oiled marketing and management machine churning, the income becomes somewhat passive. It boils down to having the right automation in place.
The best part about this is that it requires you to own no real estate. Sure, you could rent out your own home as a vacation rental. There’s always that option. But if you don’t have a second home, this is a bit trickier. Because it requires you to leave and return to your home regularly. Most owners simply rent out a second home in a vacation area.
The only difficult part here is to find owners willing to work with you. This takes time and effort. It requires you to forge good relationships with people who own high-end homes. It means getting in the right circles or even walking around and knocking on doors. This is the bigger effort required on the front end.
#2—Affiliate Income
When it comes to passive income, making money as an affiliate is certainly up there at the top. But affiliate marketing is hard. So don’t think for a moment it’s going to be easy. In fact, this is one of the hardest nuts to crack in terms of generating income passively. However, if you understand the mechanics behind marketing or have a large audience, this is easier.
To make money as an affiliate you need to be savvy. You should also use bridge funnels that let you collect contact details before pushing them to the affiliate offer. Run traffic to a bridge funnel using Facebook ads, Google ads, TikTok ads, or some other platform. The point is to drive the right type of traffic into the affiliate offer to generate a real income.
This takes work and money. If you don’t have money for paid ads but you do have an audience on social media, that’s another way to make money using affiliate offers. You do have to be careful with affiliate offers on social media to not make it look spammy. Create value around the offer and don’t just blast affiliate links everywhere.
#3—Audiobook Income
You can make passive income from audiobooks in two ways. The first way is to publish a book and convert it into an audiobook. That’s the obvious way. The second way to do this is to narrate audiobooks for other authors as a revenue share deal. That means you won’t get paid for the work you do upfront. But if the audiobook does well, you do split the revenue with the author.
That’s a pretty good deal. You do split the income after Audible gets their share. If you want to take the narration-for-royalty-share route, just go to ACX and set up an account there. You’ll need to upload some audio samples and then audition for each book. But you never know what will come across your desk. You might be the right fit for a book that hits big.
Generally, most authors who are established don’t make royalty deals. They usually pay per finished hour of work. However, if you find the right up-and-coming author, it could pay big. Plus, once you do the work, there’s literally nothing else you have to do here aside from collecting the income. But don’t misunderstand that this will be easy. It won’t.
#4—Funnel Income
Most people know that websites are dead. It’s not just because of the rise of social media platforms like TikTok. It’s because websites have too many choices. And that leads to overwhelm. In their place is something called sales funnels. Sales funnels are like magic little money-making machines that take prospects down a predefined customer journey.
If you want to learn what sales funnels are, go here. But the cool part is this. You can make passive income from sales funnels in several ways. The first way is to actually design sales funnel templates using this marketplace. You don’t need any coding experience or technical know-how to do this. And your designs are sold in the marketplace, earning you some passive income each time they sell.
You can also earn passive income from sales funnels by building out a membership course or other funnel that sells digital products. There are loads of ways you can pull this off. Just understand that it will be a lot of work at the beginning. So make sure you stick to it and keep putting in that effort to eventually get the reward.
#5—Money Income
It’s pretty clear to most people that they can make passive income from money. If you have money, you can use it to make money. That’s pretty obvious right? You can do this in a few different ways. The one popular way is called peer-to-peer lending. Websites like Prosper and several others allow you to give out small loans to people that generate passive income.
When you give the loan you can take on as much risk as you’re comfortable with. And you’ll get a share of the interest payments made. You can also use Real Estate Investment Trusts (REITs), along with things like CDs, bonds, dividend income from stocks, and more. There are many ways to do this when you have cash to deploy.
It’s important to diversify any investments you make with your money. If you have money and want it to make you more money, test out several methods before going in heavy with one in particular. This helps you diversify the passive income generated from all these methods.
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