Do you work for every dollar you earn? As long as you only get paid for the hours you work, you’ll always be trading time for money. Since your time is limited (and very precious), that means your income will always be limited as well.
The solution? Passive income. When you earn passive income, your money continues to grow even when you sleep or take a vacation.
I have personally used these tried-and-true methods to boost my income. Anyone can use them though it does take a little work to set them up and be successful.
What makes passive income so effective is that beyond the initial investment, these streams usually require very little maintenance to keep making money.
Let me show you a few ways to passively make money online.
Invest in the Stock Market
Investing in stocks and bonds can provide a long-term stream of passive income. What makes stock investing a great option is that you can start with an investment as small as $1 with some online sites.
Regardless of your investing experience, you need to make a personal investment plan.
Your investment plan should follow three key ideas:
Your own personal goals built and exactly how much you’ll need, not some arbitrary number like saving a million dollars.
The return you need to get there and your tolerance for risk in investments.
How long you have to invest and a mix of investments right for your age.
Investing is one of the few ways you can earn enough income to outpace inflation.
Invest in Peer to Peer Loans
A few years ago, the only way to borrow money with a reasonable interest rate was through a traditional bank loan. Thanks to peer to peer lending, you can be the bank and lend directly to borrowers on platforms like Lending Club and Prosper.
Peer investing is a stock market alternative that can be less volatile than stock but still earn higher returns than bonds and fixed income investments.
With Lending Club, the historical annual rate of return is between 6% and 8% which is a good middle of the road investment option to create a balanced portfolio. You can also take a greater risk by investing in high interest loans.
Build a real estate empire without being a landlord
Many people think the only way to invest in real estate is to physically become a landlord and have tenants occupy your rental property.
Being a landlord requires a lot of time and financial capital. When you don’t have both of these assets, consider investing in these two investment vehicles:
Either option lets you invest directly in residential, commercial, or industrial developments without being the landlord.
Every investment brokerage lets you trade REIT assets that you can buy or sell on any trading day the market is open.
Crowdfunded real estate platforms like Fundrise or RealtyShares are designed for buy-and-hold investors that are willing to trade liquidity for a higher potential return without sacrificing risk.
Both of these real estate investment vehicles pay monthly dividends that can be reinvested to earn compound interest (more passive income) and are a great way to diversify your investment portfolio beyond stocks, bonds, and fixed income.
Publish an ebook
It’s said that everybody has a book inside them. Even if you’ve never published anything before in your life, you can write an ebook that can become the next bestseller. Seriously.
Publishing a book takes a little more initial effort than trading stocks, but it’s an excellent way to earn recurring income and can make you a couple hundred dollars a month in book sales.
To earn the same amount of dividend income from stocks, you would need to invest thousands of dollars in the market.
With an ebook, it’s possible to publish a title almost for free if you can produce the cover image and proofread in-house. Do spend a few extra dollars and hire someone from Fiverr or Upwork to produce your book cover and proofread. The return on investments can be phenomenal if your final product looks top-notch.
Also, be sure to ask your friends and colleagues to buy a copy of the book and leave a review once the product goes live. Positive reviews are precious if you want your book to be a perennial seller.
To expand your income streams, also consider offering your book in paperback form and recording an audio version with Amazon Audible.
Start a blog
Blogging can be another way to earn passive income; even from posts you wrote four or five years ago.
You most likely won’t earn immediate income from your blog until you build an audience and your articles begin ranking in search engine queries.
If you consistently publish quality content, it won’t take long to begin earning income through your advertising and affiliate partnerships.
You can even use your blog to promote your other online products and services as you build your personal brand.
Create an online course
Some topics don’t easily fit into a blog post or book because they need user interaction. Creating an online course is a great way to generate passive income.
After the initial work of creating the course, you can reap the rewards by having the same course being purchased over and over again.
Another reason to consider video is if you’re a talented speaker but struggle to put a complete sentence together in timely fashion.
Your blog can double as a platform to sell your personal online course. Or, you might also try an online learning platform like Udemy, Teachable, or Coursera with an established audience that constantly yearns to learn something new.
Video is becoming the content medium of choice for the entire Internet community because it can be easier to connect and interact with each other.
The written word will never go away but think of how many more times you watch a YouTube video or enroll in a video-based course instead of reading a blog post or buying a book.
Wrapping it up
There are many doors of opportunity to earn passive income online.
If your goal is only to earn a small side income or eventually replace your current day job income, these methods require less ongoing effort than a traditional side hustle that requires you to work continuously to make money.