If you don’t have time to pick up a side hustle, consider focusing on income streams that can earn you money while you sleep.
If you were recently laid off, your partner lost their job, or you’re experiencing any kind of financial turmoil, you may need other ways to earn income. Even if you’re not facing job loss, you may want to bulk up your bank account so you can protect yourself for the future or strive for financial freedom.
If you don’t have time to pick up a side hustle — and if the hiring market is still looking bleak — consider focusing on passive income streams that can earn you extra money while you sleep. Having a passive income source can help to get your personal finances in order as well as ensure you have a backup plan during these tumultuous and uncertain times.
What is passive income?
Passive income is income that requires a minimum investment in terms of effort. Unlike working a side hustle, passive income opportunities offer a set-it-and-forget-it mindset and don’t require daily attention.
Why passive income is important
It’s important to come up with passive income ideas for a few reasons. In an unpredictable world economy, it can provide some stability. Also, with passive income strategies, you can make some extra cash without taking time out of your already-busy schedule.
Andrew DeBell, a learning consultant and video designer at Water Bear Learning, says the following:
If you can create revenue streams that require little to no maintenance, you can reallocate your time to start new projects. Or invest in additional revenue streams to diversify your entrepreneurial portfolio. Time is the most precious resource that every human has. Passive income provides you with more time to spend doing exactly what you want to do.
Ways to earn passive income
If you’re ready to start earning some extra money that can give you more control over your finances, free up your time, and provide a more solid financial future, then here are some ways to get started.
No. 1: List with Airbnb
If you have an extra room in your home, list it with Airbnb to start earning rental income. There are other property rental options to explore like Vrbo and Craigslist.
Even though there aren’t a lot of people traveling right now, you can at least ready your listing for when people start making plans again. You can also consider renting out your space to health care workers who are flying to certain states to help or who need a place to remain isolated from their families — just make sure to clean and disinfect your space thoroughly, as well as offer a flexible cancellation policy so your guests are protected, too. Additionally, investigate any local, insurance, or tax requirements that come with listing a property for rental, such as registering your rental with your city
No. 2: Rent out another property
If you have the income, you can build an accessory dwelling unit (ADU) — a second dwelling that’s attached to your property — or renovate an existing structure, like a garage, and convert it into a rental property, according to Heather Peake, a writer for Rentec Direct. You could also purchase a duplex and live on one side while finding renters for the other as part of your real estate investing strategy.
“These opportunities allow you to have quick cash flow, all the while gaining experience in the industry,” she says. “From there, the sky is the limit. Self-storage, turnkey, single-family homes, multifamily, commercial, foreclosures, and the like can be acquired to expand a rental portfolio.”
No. 3: Create an online course
Creating a physical product may be difficult and expensive, but what about putting your skills to good use and teaching others through an online course? To create an online course, all you need is a syllabus, a niche topic others have not covered (or not covered well), and a good production setup (a camera, lighting, microphones, etc.). You can list it on Udemy or Teachable, and then start to watch the money come in. This is one of the passive income streams that is thriving, as people are going online for learning opportunities.
“Once you get students and gain confidence in your online teaching abilities, consider growing an audience on your own platform and selling your course directly to them,” says Blake Stockton, a staff writer at Fit Small Business.
No. 4: Invest in the stock market
While you may have a savings bank account that earns interest, one way to make passive income is to invest in the stock market, specifically, companies that pay dividends. The average stock market return is about 10% to 11% per year, far above your typical savings account interest rates. Even though the stock market is not doing well during the COVID-19 crisis, you can buy lower-priced stocks that you expect will bounce back once this is all over. These include trusty, blue-chip dividend stocks that pay you quarterly dividends. You can even reinvest those dividends to make even more money on your investment.
No. 5: Seek out licensing deals
Have you ever taken a good photo, written a nice song, or made a video that got a lot of hits? Consider licensing out your work for residual income. You can license your photos to iStock, submit your tunes to music libraries, and license your videos to publishers who might need them for e-learning courses or academic e-books, DeBell says:
This is a great way to earn passive income as there is very minimal work to be done after setting up the contracts and sending videos out to publishers.
No. 6: Rent out your car
When you’re not using your car, rent it out on sites like Turo. Just make sure you read the fine print on these sites’ insurance policies as well as your own to see if you’re allowed to share your car. And, as always, keep your car clean, disinfected, and looking great in order to earn good reviews on these sites and stand out from other listings. Turo’s blog offers tips on maintaining healthy car-sharing practices to help out car owners.
No. 7: Start a blog
Blogging is a great way to earn affiliate marketing and ad revenue, and you can do it from the comfort of your home. Though you’ll need to come up with a blog in a niche where you can actually compete – as well as update it regularly. Once bloggers build up their audiences through great content and SEO strategies, they can pursue affiliate marketing opportunities, where they receive a percentage of a sale that a company makes from a blog visitor clicking their link. Bloggers can also place Google ads on their websites, making money off clicks. A blog is a simple online business that can pay off massively when done right.
These ways to make passive income are your first step to financial independence and freedom. Once you get the ball rolling, you can be well on your way to more stability, even when it seems like the world around you is not so stable. It all starts with a little bit of strategizing and ingenuity – as well as the best passive income ideas – to transform your life and ensure you come out of this difficult time stronger than ever.
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