People are always on the lookout for ways to earn passive income. Some parallel income ideas that would provide them with an alternative source of income that would help them either pay bills more regularly or alleviate their standard of living.
Before we elaborate on the various passive income streams let us first start by answering the question –
According to the definition given by the internal revenue department of the US government, passive activities are those activities in which you do not materially participate. For tax purpose they have been broadly categorized into the following:
- Trade or business activities
- Rental activities
For general purpose, Wikipedia has done a better job in defining it. Passive income is the flow of cash on a regular basis that does not require much time or effort on the part of the receiver.
Hence, any activity that lets you earn money through legit means, online or otherwise, without taking up your time would be a passive income activity.
People need extra cash to pay off debts early or supplement a regular source of income. Since regular jobs already take a lot of time and effort, a person is not left with enough energy to take on another part-time job.
In such cases, earning money through passive activities becomes a great option.
Here, we have compiled a list of 36 passive income ideas that would help you earn some extra cash. Certain activities might require some talent or some sort of financial investment. You can choose the one that suits your particular situation.
- Invest in high ROI accounts
- Invest in stocks
- Invest in index funds
- Earn through robo advisors
- Invest in Real Estate
- Put up space for rent
- Rent your car
- Lend money
- Buy expensive tools and rent them out
- Earn Royalties
- Start a vending machine business
- Build a dropshipping ecommerce site
- Earn commission while reselling products
- Become owner of a comparison site
- Earn from the ads on your website
- Become an affiliate marketer
- Write an ebook
- Make an online course, guide or tutorial
- Earn money through YouTube videos
- Build an app
- Become a virtual assistant
- Become a beta tester
- Become a member of focus groups
- Earn money for stuff you do regularly
- Earn credit card cash back rewards
- Earn though price drops
- Earn money through your hobbies
- Earn while your exercise
- Earn by taking surveys
- Like babysitting, do housesitting
- Test website and get paid
- Earn by participating in mock trials
- Earn by posting on forums
- Use Bing instead of Google and get paid
- Sell domain names
- Sell your books, clothes online
Legit Passive Income Ideas That Will Make You Money
#1. Invest in High ROI Accounts
One of the best residual income opportunities is to invest your money is some high yielding savings accounts.
There are various banks that offer good interest rates through which you can earn money at top rates. Some banks offering high interest rates are shown below:
#2. Invest in Stocks
Investing in the stock market is also a great way to earn passive income. If you have sufficient cash and sound knowledge of the stock market, then you should certainly try this passive income opportunity.
One of the best ways to get high ROI would be to invest in high dividend stocks. Even most of Warren Buffet’s income comes from dividends and capital gains.
You can find some high dividend paying companies through this Google tool.
#3. Invest in Index Funds
If you are uncertain about how to invest in the stock market, then starting with index funds would be a great idea.
These funds are similar to mutual funds in which you do not need to choose which stocks to invest in. It is managed by the particular index fund through which you will be investing.
Investing in Vanguard index funds would be a good idea to get started in this passive income investment opportunity.
#4. Earn Through Robo Advisors
Another way to invest in the stock market is through robo advisors. They are pre-programmed algorithms that would run your portfolio for you.
Some popular robo advisors are Betterment, Wealthfront and Ellevest.
According to consumerreports Betterment has more than a third of its investors aged 50 and more whereas Ellevest is a robo advisor for women investors. You can now easily earn residual income by employing one of these robo advisors.
#5. Invest in Real Estate
If you are not confident enough to invest directly in real estate, then you can use REIT-real estate investment trust. Through this investment vehicle you can invest in real estate without any hassles of landlord duties.
Some known crowdfunding investment companies are Fundrise and Realty shares. Fundrise is good for investors who want to invest small amounts. You can use their online resource eREIT for generating passive income.
VRBO and Airbnb are websites that allow property owners to list their properties for accommodation sharing.
Before listing your property, it’s important to check your local and state laws regarding short-term rental accommodations. You can refer to a study done by the R Street Institute in 2015 to understand your city’s legal framework.
If the laws in your city/state are favorable, renting out your property through these websites can be a great way to earn passive income.
Another way to generate passive income is by renting out your car through platforms like hyrecar or Turo.
Lending money through platforms like Lending Club can also provide a good return on investment if you choose the right borrowers.
Renting out expensive tools or equipment, such as cameras or video recorders, can also be a profitable venture through sites like sharegrid or Craigslist.
Earning royalties on products like books, songs, or products can provide long-term passive income if the product becomes popular.
Investing in a vending machine or starting a dropshipping eCommerce site are other ways to create residual income.
Setting up a comparison site, earning from ads on your website, or becoming an affiliate marketer are additional ways to earn passive income online.
You can access a list of high-quality affiliate networks. To start earning passive income, simply download the earny app. This app links your mailbox and Amazon account to check for lower prices on your online purchases and automatically request refunds when possible. It’s one of the easiest ways to make passive income without much effort.
From college students and stay-at-home-moms to 9-to-5 job holders, passive income streams can help people pay bills and debts, and even afford luxurious holidays once in a while.
With the help of the 36 passive business ideas mentioned above, you can set up passive income streams according to your skills, monetary resources, assets, and time.
- If you have enough investment money, consider index funds and real estate.
- If you have exceptional skills in writing, photography, or technology, choose income streams that cater to those skills.
- Earning through cash back and shopping apps is perfect for busy individuals looking for some small earnings.
All the passive income streams mentioned have been tried and tested by people and proven successful.
So, why wait any longer when you can start earning some extra money now!
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