‘Passive Income’ is earnings deriving on a regular basis, requiring minimal to no effort by the recipient to maintain it from an investment or work completed once’.
This is something that is not taught in school, as most are taught core skills which provide the ability which shapes the individual to get a job and earn an ‘Active Income’ i.e. offering your services and time to a company in return for compensation – which is a result of exchanging time for money.
Think of passive income as planting a seed which you water, tend to, expose to sunlight and grows exponentially over the months and years based on the investment you made and every so often watering tending to it and exposing it to sunlight (growth). Just like the tree produces fruit, the investment in a passive income option generates income once a certain system is in place. So, whether or not you are a corporate professional already earning an income, an existing entrepreneur, a stay at home parent, a student who is currently studying or it could be that you have a passion in a field but you are not too sure how to monetise it, or simply wish to create another income stream, the next chapter titled “Passive Income Ideas” are for you to review, consider and get you closer to your goal of having multiple income streams. It is important to be aware that as human beings we all at times have limited beliefs and doubt we can do things or think that others are either ‘lucky’ or ‘smarter’ but I promise you this – we can all create some form of passive income. When I was 7 years old, I was unable to read, declared special needs and was kicked out of a school and home schooled for a year. So if I can do it, I promise you, you can do it too! Don’t doubt yourself, research some of the below, get started and work towards your full potential!
1. Invest in a Camera and take Photos
If you like pictures and you find yourself scrolling on Pinterest/Instagram for hours during the day, looking at picturesque views, art and scenery in your spare time, why not convert what may be your passion for some money? Photography websites like Smugmug, 500px Prime and Shutterstock are all companies established where you can list photos where customers can download for a fee. The back-end and operational elements are managed by the platform and the company simply provides you with a “Sale breakdown” based on what image was downloaded from a user. Some users pay over £100! per photo downloaded. So imagine a photo you took of let’s say a sunset in the Bahamas in 2017 gets downloaded again and again for years on end. Essentially, you will be earning residual income which is income not only you could be making while you are sleeping but also sales coming in from a photo taken once. Mind-blowing right? Include the link to the website.
2. Buy a Home and Rent out Rooms
Property investment is one of the most common forms of earning a passive income (to some extent). 90% of all Millionaires become so through owning real estate so there is no surprise earning money from rental income is not a great idea. You make money two ways from a property: (a) renting out the property and (b) capital appreciation – selling/ taking money from the property based on the profit derived from its increase in value*. In terms of earning an income from a Property you can either rent single rooms or a whole house. A house with multiple occupation is quite lucrative and is also passive, however re- quires some active work due to managing queries or answering questions from a property manager who may manage the property on behalf of you. The easiest way you have probably heard of is by becoming a Landlord, it is quite simple. You have a loan you pay back to the bank (buy-to-let mortgage) and your tenant(s) pay you rent and the difference is your profit. So if you pay the bank £1000 and your tenants pay you £1500 the difference and profit you would have made is £500. Once your mortgage is paid off (usual time frame is 25 years unless you make higher repayments/made a higher initial deposit upon purchase) you will have a full £1500 in your pocket which is a pretty good considering you would have made this investment from many years ago. Now imaging if you had a home with 5 bedrooms you rented for each £700per month, that’s a whopping £3500 per month all from one house
3 Start an Amazon FBA Business
The Fulfilment By Amazon business model is similar to that of a traditional ecommerce business. The only difference is Amazon provides the fulfilment by storing your products, packs and ships them to your customers. For someone new to ecommerce, Amazon FBA could be a great option as Amazon essentially provide you with a platform, perform like a member of your company by taking care of packaging materials, courier arrangements and storing within logistics. You only need to take care of the marketing aspect, creating a brand and increasing the brand reputation by becoming an expert/authority in your field. It will probably be useful to grow an email list in order to engage with your audience you will be building while you are selling on the Amazon platform. The earning potential on Amazon is enormous, there are numerous Amazon FBA sellers earning well over six figures per month by leveraging the FBA model. Of course, earning £100k per month will not be down to just luck, or setting up an FBA account and not doing anything. You will have to just like all business work smart, tweak and tailor information you share to your audience and eventually you will be able to sit back and earn money while you sleep!
4. Start a Youtube Channel
If you are passionate about a topic, it could be anything from make up tutorials, how to play the guitar, how to use a particular software, comedy, opinions on movies / music videos, literally anything… why not put it on YouTube. You can literally start a YouTube Channel with minimum investment meaning a Smart phone like such as a iPhone or if you had some capital you were willing to invest a professional camera like a Nikon/Cannon. What is key is that you make compelling videos about a topic people want to watch and of which have the potential to be shared and in time go viral. Focus on valuable material, do not let your own personality to shine through and small errors do not be hung up about as it gives the human element to those watching. Once a video is created it can provide a positive cash flow for a very, very long time and of course depending on your field you can earn money not only through adverts but also by brand partnerships amongst other revenue streams. YouTube is owned by Google and works fabulously with Google AdSense. Attach the videos to AdSense for automatic ads. When users click on those ads you receive a payment from AdSense. There are numerous Youtubers and Influencers who have replaced their full time 9-5 income with passive income or who have simply started out on YouTube as a profession such as: PewDiePie, Emily Eddington, Jenny Jenkins, MyLifeasEva and Ingrid Nilsen.
5. Invest in Cryptocurrency
Cryptocurrencies are fast becoming very popular among millennials mainly because of the rise of “Bitcoin Millionaires”. Cryptocurrency is a digital asset designed to work as a medium of exchange that uses strong cryptography to ensure financial transactions, con- trol the creation of additional units and verify the transfer of assets. Bitcoin, Ethereum, Ripple and Litecoin are all cryptocurrencies which during the boom of 2017 where Bitcoin skyrocketed to $20k had every one on the edge of the seats wishing they had invested. Erik Finman, a 19 year old who had invested in cryptocurrencies is one of now many who has managed to become a Millionaire through cryptocurrencies Finman currently owns 401 Bitcoins which he had bought from May 2011 which as of January 2018 was worth well over $7.5million. Toray K, a UK investor from Cryptonary.com is another savvy and cool investor who invest- ed £14,000 in Ethereum and made well over £500k from investing in Ethereum while it was under $12 per ETH coin. TorayK bases his success from HODLing (Holding is a mechanism of a crypto investor where you do not sell during the volatile swings) and Dollar cost aver- aging which is an investment technique where you continue buying a particular investment on a regular schedule regardless of the price so you benefit from entering trades at high/low price points so when the value of a coin gains exponential growth you make huge gains. Ian Balina is another great savy investor who invests predominantly in ICOS’s and has become a Multi-Millionaire by doing so which I will cover in part two of Top Ways to Make A Passive Income so stay tuned.
6. Affiliate Marketing
“Affiliate marketing is the process of earning a commission by promoting other people’s (or company’s) products. You find a product you like, promote it to others and earn a piece of the profit for each sale that you make.” – Neil Patel
One great way to generate a passive income is through affiliate marketing. Now, this does depend on the size of your list. Yes, size matters when it comes to your list. Especially if you’re looking to make some serious money and do it on autopilot. But, list-building takes time. It doesn’t happen overnight. And you need to add value to your list or you become obsolete. Build a list in a particular niche and tell them stories. Create a bond. Build a relationship with them. It’s important. Then, when you’ve created a bit of culture, start marketing affiliate products or services to them that you think they might like. Just be sure that you personally vet out whatever it is that you’re selling to avoid complaints if the product or service falls short. And if you’re wondering whether you need a blog or a website to build a list, you don’t. You can use sites like Medium or Quora or LinkedIn Publishing, and place a call-to-action to join your list. It’s as simple as that. Build up quality content and invite them to join your list. Then, start marketing to them.
7. Set up an Ecommerce Website of Buy an Existing one
E-commerce is the activity of buying or selling of products on online services or over the Internet. Electronic commerce draws on technologies such as mobile commerce, elec- tronic funds transfer, supply chain management, Internet marketing, online transaction processing, electronic data interchange (EDI), inventory management systems, and automated data collection systems. The beauty of an online business is that most will allow you to work from anywhere in the world provided you have an Internet connection to check on your business. Websites like wordpress.com and shopify.com allow you to create your own webstore and alternative sites like flippa.com allow you to buy existing profitable businesses. E-commerce can be a very lucrative industry and small businesses in certain niches have been known to grow revenue over six figures per month with very little money upfront. Learn more how to start your own e-commerce site with little to low start up investment here.
8. Buy a Vending Machine Business
Buying a successful vending machine business can be a great way to make passive income. Check out businessesforsale.com or perform a google search to see if you can find a company/sole trader selling a vending machine. The fundamental step will be for you to find the best places to install your vending machines. Check with small-mid-sized companies possibly in the brick and mortar businesses that have over 200 workers in the building on a daily basis, and make calls, set up meetings to see if they need vending machines and what type of products they would like. Quite often it will be chocolate bars, crisps, snacks and soft drinks but it is always good to ask as the company employees will be your customers. You have to give them what they want or your business will not turn over profit. Once again, if you want to reduce the amount of time that you are involved, consider hiring someone to stock the machines for you. Vending Machines can provide you with a Passive Income allowing you to earn well over 50K per year and work for yourself and enjoy a passive income based on customers snacking on your stock.
9. Start a Blog
One of the best ways you can create a passive income is by blogging. Yes, in the beginning there will be no income. Expect that. But, over time, you’ll start to generate an income from that blog. Eventually, it will snowball. Potentially, it could earn you six or seven figures per year, sometimes even more. There are some basic steps you’ll need to take before you start a blog. Don’t just rush head- first into this without planning first. Blogs in the following sub-markets make the most money:
- Dating and relationship related blogs
- Money related blogs
- Diet and fitness related blogs However, you should pick a niche and blog about that. If you’re launching a money related blog, maybe it’ll be about how to make money in real estate or simply how to make money online. Pick the niche and stick to it. If it’s a diet and fitness related blog, maybe the niche is intermittent fasting, the Atkins diet or some other form of diet or fitness.
10. Write Ebooks
Ebooks are one of my favourite sources of passive income. Now, you can do this the simple way and just publish it on Amazon’s KDP. Or, you can go all out and build yourself a book funnel. Book funnels are powerful, but they won’t be fully passive. For example, if you do a free-plus-shipping offer for your eBook (converting it into a physical book), you’ll need to create some one-time offers (i.e. extra training) and up-sells (i.e. an audiobook). But, a book funnel can be very powerful. But, you don’t need to go further than that. You can simply write it and publish it and col- lect the income. That’s all. Send out a couple emails to your list (if you have one) or post it on social media, and there you have it. Passive income. Now, the amount of income you receive depends on the quality of the book you’ve written. How well did you craft the message? How targeted was the information to your audience? It counts. If you want to take it a step further, you could easily create that eBook into an audiobook using the Audible platform. You can either produce the audiobook yourself or hire out a producer to do it for you. You can either pay them a flat fee or a royalty from the proceeds of the audiobook.