Do you want to make money as you sleep? But are passive income ideas actually possible? This is a common question among people who want to make passive income. They wonder if it is possible to make money without doing anything. The answer to this question is yes, it is possible to make money without doing anything.
However, you will need to do a lot of things to be able to generate money without doing a thing. You have to spend money or use other resources such as time to make money. You must invest your time to form a foundation of passive income. In the next part, we will look at the most important and best passive income ideas you can start using today.
To obtain financial freedom, one must be either a business owner, an investor, or both, generating passive income, particularly on a monthly basis. ~ Robert Kiyosaki
Why passive income?
Today, 78% of all Americans live paycheck to paycheck. 40% of Americans can’t cover a $400 emergency. Household debt is at the highest level it has been. All these are some of the reasons why most Americans are looking for ideas to make money as they sleep. The single search for passive income ideas generates more than 82 million results. In this article, we will look at some of the easiest passive income ideas you can do today.
- 1 Passive Income Idea #1: Robo Advisors
- 2 Passive Income Idea #2: Peer to Peer lending
- 3 Passive Income Idea #3: Drop shipping
- 4 Passive Income Idea #4: Niche Websites and affiliate marketing
- 5 Passive Income Idea #5: Create a Software or a Game
- 6 Passive Income Idea #6: Real Estate
- 7 Passive Income Idea #7: Online Coaching
- 8 Passive Income Ideas #8: Invest in Index Funds
- 9 Final Thoughts on Passive Income Ideas
- 10 Watch This Video on Passive Income Ideas
Passive Income Idea #1: Robo Advisors
In the past few years, the concept of robo advisors has been very popular. These are companies that allow you to deposit money and then they can invest on your behalf. The companies invest according to your risk appetite. If you want small but safe gains, the companies will diversify your holdings in stocks, bonds, and ETFs.
While robo advisors are good, there is a need for caution. First, most robo-advisors are young companies that are unprofitable that may not survive in a long time. Second, most robo-advisor companies have never gone through a recession. Therefore, we cannot tell accurately whether they will survive if one comes. Third, you should not expect to make a lot of money when investing in these companies. The average return per year is less than 10%. Here are some of the best robo-advisors for you to generate passive income.
Passive Income Idea #2: Peer to Peer lending
The concept of peer to peer lending is also relatively new and is a good method to generate passive income. The peer to peer companies connect lenders to borrowers. They use their technology to scan the credit worthiness of a borrower. After finding eligible borrowers, the companies put them in a marketplace where lenders like you can extend credit to them.
Like with robo-advisors, peer to peer lending companies come with several risks. First, most companies that offer P2P lending are very unprofitable. If they fail to get enough financing, some of these companies could disappear. Second, there is a likelihood for losing your money especially when a borrower defaults. Third, you need to qualify to become a lender with these companies. Finally, you cannot expect to make extraordinary returns with p2p lending. Some of the best peer-to-peer companies you can use are:
Passive Income Idea #3: Drop shipping
If you follow pop culture regularly, you might have seen stories about Soulja Boy. Soulja Boy was one of the best-known rappers ten years ago. Then he disappeared. Sometime last year, Soulja made a comeback. As he started becoming famous, he started leveraging technology to sell stuff online. These stuff included things like headphones and gaming consoles. He sold them through his store. The reality is that Soulja Boy never invented these products. He also never shipped them. Instead, he found some suppliers in China, who used to fulfil the orders. This is a strategy known as drop shipping. To do it well, you need to do a few things.
- Find a good niche.
- Find a good supplier.
- Create a good website.
- Market the website.
You will make money whenever a customer buys the product. This method is a good one because you don’t need to spend a lot of money to get started. Also, you can make a lot of money if the niche is successful.
Passive Income Idea #4: Niche Websites and affiliate marketing
I was introduced to niche websites by a friend who used to make thousands of dollars using the strategy. A niche website is a small site that directs a user to buy products from a seller. It is a form of affiliate marketing. As a niche website owner, you will make money when people visit the seller’s website and make a purchase. Here are some of the most important tips for you to run a successful niche site:
- Find a niche that is unpopular. You don’t want to focus on popular products like smartphones.
- Create a good website and invest in SEO. SEO will help your products be visible to internet users.
- Create multiple websites. A single niche website will not make you a lot of money. Most niche sites owners own more than 30 websites.
- Be an authority. Create your website in such a way that the readers will think that you are an authority in the industry you are targeting.
Passive Income Idea #5: Create a Software or a Game
I use an email client called Mailbird. While I have free access to Microsoft email app and Outlook, I love the way Mailbird is created. For this reason, I pay $20 to access the software. More than 50,000 people use the client every year, which means that the developer makes more than a million dollars every year. There are other software that you can develop, that will make you a lot of money.
You can also develop a simple mobile game. If you are a software developer, this will not be a major issue for you because you can develop a software easily. If you are not a developer, we recommend that you come up with an idea, find how viable it is, and then find a developer. You can use platforms like Upwork to find a good and cheap developer. Follow the following tips:
- Ensure that your software solves a real problem.
- Get a good quality developer.
- Market your software well.
Passive Income Idea #6: Real Estate
Another excellent income idea you can use is real estate. To use this, you need to have a substantial amount of money because the cost of building a house is usually relatively high. If you want a good source of passive income, we recommend that you focus on rental residential buildings. This is because these houses will always be in demand. Also, we recommend that you select strategic places that have huge potential. If you don’t have a lot of money, we recommend that you use the common online real estate platforms like:
Passive Income Idea #7: Online Coaching
A great passive income idea you can use is that of online coaching. This is because many people are seeking for education on various fields. When you create a good course, you will be waking up and finding that a few people have purchased it. You can create your own website where you will be coaching people. However, a better strategy is to use the platforms that are available and those that have millions of users. Here are the best websites for creating online learning materials.
Passive Income Ideas #8: Invest in Index Funds
Stocks give the best returns in the market. In the past ten years alone, stock prices in the United States have more than doubled. As this is going on, people have become richer. For example, because of the Amazon stock he owns, Jeff Bezos has grown his wealth from less than $40 billion ten years ago to the current $130 billion. He would be worth more than $160 billion only that he gave part of it to his ex-wife. If you are not a good stock picker, we recommend that you focus on index funds. These are funds that track publicly listed companies. In the past few decades, investors who have invested in index funds have seen their investments grow ten-fold.
Final Thoughts on Passive Income Ideas
Interest in passive income is growing around the world. The common challenge is that most people believe that it is easy. While it is possible to make money without doing much, you need to invest a lot before the cash flow starts to come in. For example, it will take you more than 6 months before you start making money using niche websites. Now watch this video on Passive income ideas.