Passive income has long been the right choice for entrepreneurs looking forward to freeing up their time from the demands of daily activities and responsibilities, and still be able to generate good monthly revenues. In simple terms, a passive income is money you make or get paid while you sleep. This income can come from setting a business such as a tow truck, earning from real estate, affiliate marketing, among others.
Passive income differs from active income in that active income is when you get paid after the work is done. It is never a good idea to put all your eggs in one basket; you should always diversify your streams of income. No job is 100 percent safe; shit happens. Having a passive income may not entirely replace your salary (active income) in case something wrong happens, but may help you have a stepping stone in case of uncertainties.
Here are some of the passive income ideas you might find worth your effort;
Investing is the ultimate and most desirable form of passive income that you can imagine of. One way of investing is through buying stock. When you own stock in a company, you set yourself up to earn passively through dividends. – A dividend is simply a distribution of a portion of the profit a company generates. The amount of dividend you receive depends on the amount of stock you own and the possible profit to be shared. To get more dividends, companies offer a chance to buy more stocks.
Peer to Peer Lending
Banks no longer lend money out of kindness, they do it with the sole aim of making a profit. You can make some money through peer to peer lending. With this form of lending, the profit you make is a bit less than what banks make, but it is still high enough to generate you some form of income. You can join various lending clubs that participate in peer to peer lending.
Real estate has a very significant scale when it comes to passive income. However, when we talk about real estate, many people only think about rental properties which they consider too high (regarding startup capital) to invest in. The truth is that there are different effortless ways you can get started in real estate investing. These methods include; REITS, crowdfunding real estate, rental properties among others. REIT is a real estate investment trust which is like some form of mutual fund.
You can earn a significant amount of passive income by investing in scalable online businesses. The level of difficulty of what you will establish depends on what you’re selling. Ways of getting started in online businesses include eCommerce – such as Shopify. Additionally, you can start a blog and monetize it. There are many monetization strategies available, including Google AdSense, Affiliate Partners among others.
Brick and Mortar Business
They say the first effective way of earning passively is to establish a company. If there are many hustles of establishing a company, while not start a business. The business to start doesn’t have to be an online business, it can be a brick and mortar business. A good brick and mortar business can be a good investment that generates you a good passive income. As per with any business, its success will be determined by several factors such as business location, what you are selling, competition, customer service among others.