If you are a hardworking guy/gal with an 8 to 5 job, you currently make a living with “earned income”, which is paid either by the hour or with a yearly salary. If you are suddenly unable to perform at work anymore, you will no longer receive checks and your income will plummet to $0. This is why additional “passive income” is so important! With passive income, you would perform your work with very little or no pay in the beginning, but once your project is complete, the paychecks will continue to come in (sometimes for life!). Every person alive should be looking for these 3 ways to receive passive income.
What are the different ways to create a passive income?
1) Dividends – The idea is quite simple. There are a few hundred (maybe even thousands) companies that pay a quarterly dividend if you become a shareholder. This method is great for a long term focus, but it definitely won’t allow you to quit your job anytime soon (to do this, you will need at least $1 million in the market).
2) Rental Income – This method has been around for quite some time and the general concept is quite simple as well – all you have to do is purchase a property and allow someone to rent it from you. As long as the resident is on your property, you will continue to receive those rent checks month after month.
3) Profits from a Business – This is probably the most lucrative way to make a passive income, and there are countless methods within this category.
- Website business – The latest craze has been blogging (pretty much what I do here on this site). If you receive a consistent flow of visitors to your pages, advertisers will want to post their business on your site. This provides income month after month. And, once you establish your website with quality content, less and less effort is necessary to continue to receive your income (which is what makes it passive).
- Network Marketing – I tried my hand at this once and it is actually pretty tough. You must believe in the product you are marketing. If you do not, don’t even try; your clients will sniff out your fake enthusiasm. If you are legitimately excited about the product, then this could be an amazing opportunity. I know quite a few people that make a very good living in this category.
- Develop an iPhone application – This is a new idea that I’m becoming more interested in every day. If you have an idea and can get an app made for it, there could be an enormous amount of passive income coming your way!
- Begin a business and franchise the system – Anyone can start a business, but few really know the tools to make one run successfully. If you have this talent, you can make a lot of residual passive income by teaching (or selling) the system to others.
- For the gifted: Write a song or book – authors and song writers make royalties each time their work is sold. All of the work is done up front, and they reap the benefits for years and years. I think Elvis still makes more money in a month than I’ll most likely see in my lifetime (and he hasn’t been alive in decades)!
Passive income can come from many avenues, but the key is finding what’s right for you. I honestly love writing these posts every day, and I can’t wait for comments from my readers each time I post a new article. I hope to be able to monetize this site enough so that I can spend more time helping others through my writing!
Do you have other ideas for creating a passive income? Share with the rest of us, even if it’s just a slight variation from what was written in this post!