Do you know you can earn more income? Have you heard of passive income? Do you have any idea how you can earn passive income? I got you covered! Keep reading to get answers to the questions above.
What is Passive income?
Passive income is money you get, which you do not need active work to earn it. This is apart from your paycheck, which you get from active working. To earn passive income, you may use your talent, and make little or large investments. Also, you can earn passive income from rent, writing e-books, blogging, and more.
With the way the price of things is high now, you can prevent your household budget from shrinking by making passive income. Let’s check out different sources of passive income.
Sources Of Passive Income
Below are different passive income options. Some of these options require little active work, while some are effortless.
#1. Open a Savings Account
You can open a savings account and earn passive income through the compound interest deposit. Though, what you earn from a savings account may not be big as what you get from stock. But, it does not come with the risk because it is FDIC insured.
For now, the average interest rate you get on a savings account is 0.10%. So rather you may want to shop around at online banks or opt for a certificate of deposit. The present savings rate at Ally Bank is 0% and it is also 0% with Discover.
Open a CD
There are financial organizations that issue certificates of deposit for terms ranging from a few months to 20 years. Once the term is over, you can cash in your CD and also interest, which you can use for investment.
CD is also risk-free because it is insured and pays a high rate, unlike savings accounts. This makes it a good idea for passive income.
The only disadvantage of CD is that there’s a penalty if you remove your money before the full term ends. Nationally, average CD rates pay 0.31% for a 12-month CD, but some banks online pay more.
Get a Cash Back Credit Card
Cash Back Credit Card pays you when you make purchases. Hence, you get passive income when you put the purchase you want to make on the credit card. All you need to do is make payments with each purchase.
You will earn points that can be used for purchases, convert to money, and use to pay your balance. You can get up to 5% cash back on some purchases. Though, this depends on your credit card.
Sign Up for Cash Back Sites
Sign up for Cash Back sites such as Rakuten and Swagbuck, you can purchase items on these sites instead of going to normal stores. Plus, you get cash, gift cards, and points by just shopping on these sites.
Learn more about Swagcodes and how you can make extra money from the.
Rent Out Your Stuff
You could have things that somebody else needs, consider renting those things out. It could be a tool that a DIYer needs for a few hours, a baby gear that a mum needs for a trip, a tile saw, a portable crib, and more.
How do I rent my stuff out? You can make use of Sparetoolz and Babyquip sites. All you need to do is take a picture of the things you want to rent out and them on the sites. Start cashing out.
Wrap Your Car
If you own a car, you can use it to make passive income. Your car can be used for advertising. Sites such as Wrapify link drivers with major companies that will pay big cash to use their cars for moving billboards.
There’s no upfront investment and don’t worry, your car will not be damaged as long as it is in good shape. You can earn up to $264 to $452 a month if you cover your car fully.
Offer Your Bike for Rent
Another way to earn passive income is to rent your bike out if you own one. Sign up for Spinlister and rent your call to someone who needs it but does not want to buy it.
Spinlister takes a 17.5% fee on the rental, however, you can set your price to draw in more renters. Spinlister says you can make up to $500 a month.
Rent Out Your Car
If you have a car do not let it rust away, you rent it to make a passive income. The Turo website allows you to rent your car for daily rates. It gives insurance and claims you can earn up to $10,500 a year renting your car. If your car is old, you may not earn up to that.
Rent a Spare Room
Besides a car or bike, if you have a spare room you can use it to earn passive income. SpareRoom and Airbnb help you advertise your spare space and screen tenants to find a match. Once that is done, you can cash out to pay a debt or invest it.
Buy a Rental Property
You can also choose to buy an investment property and rent it out. This is very profitable. You can pay for your mortgage, and also build equity, as the property’s value appreciates after some time.
Sell Your Photos
Do you know you can take pictures and sell them online? I guess you don’t!
This is another way to get passive income. You can make use of the photo distributors online such as Shutterstock and Alamy, which accept photo submissions. Just make sure you follow the instruction.
Start a Blog
Starting a blog is another way to earn passive income and the process is simple. It may not pay very much but if you are willing to put in the effort, you will be making passive income on daily basis.
The basic steps are just you choosing a topic that interests you, a platform such as WordPress, and creating beautiful and useful content.
Start a YouTube Channel
Start a YouTube channel! If you do not want to write. You can make videos on YouTube, and monetize them with advertising, and merchandise.
Publish an E-Book
Do you can write and send E-books? Do let your writing skill waste away. There are companies that allow writers to publish their e-books but they are not to be compared to Amazon. Amazon’s Kindle Direct Publishing service enables authors to self-publish digital and paperback books and gives the platform to sell the books.
Start a Podcast
Starting a Podcast is also a great idea, just invest in a good microphone and monetize your podcast through sponsorships and affiliate sales. Just like a YouTube channel, you will create Podcast content and link it to several Social media sites to cause more traffic.
Publish and Sell an Online Course
If you have a skill such as writing codes, constructing a backyard deck, or any knowledge you have that you can create a course out of it. You can sell the course on platforms like Digital Chalk and Click4Course, they have tools that help you create and publish your course.
Create an App
Another way to earn passive income is to create apps and sell them. If you noticed, there are some apps that you buy while some you download for free but the free ones most times come with ads.
Hence, you can create an app, sell or give it out for free and use it to sell ad space.
You may want to ask but I don’t know anything about creating apps. Don’t worry, some sites like Bubble assist you in creating professional apps.
One of the good things about being a Rockstar is that royalties pay income for as long as the public consumes your work.
Even though you did not make a song or movie, you can buy royalties on sites like Royalties exchange. Royalties exchange enables anybody to purchase the rights to someone else’s intellectual property and get steady payments linked with it.
Buy a Vending Machine
Investing in Vending machine is a great idea! It’s a great source of passive income. Gumball.com can link you up with your vending machine, stock it, and start making money.
Flip a Website
Besides a blog, you can buy a functioning e-commerce website and resell it. Flippa site provides a marketplace website, you can improve on it if you have Savvy and flip it again.
Passive Income and Tax Liability
Any income you earn, you have to get a tax liability. However, if you choose to set your passive income as business, you can send the passive income funds you earn into a retirement account, like a solo 401(k) or a SEP IRA. These accounts provide a tax break the year you participate.
To get started, you need to get an employer identification number for your business. Then, go to your financial advisor to learn about your choice and open an account.
FREQUENTLY ASKED QUESTIONS (FAQS)
How can I make $1000 a month in passive income?
9 Passive Income Ideas that earn $1000+ a month
- Start a YouTube Channel.
- Start a Membership Website.
- Write a Book.
- Create a Lead Gen Website for Service Businesses.
- Join the Amazon Affiliate Program.
- Market a Niche Affiliate Opportunity
- Create an Online Course.
- Invest in Real Estate
How can I make $300 a day?
- Flip Amazon Deals.
- Use Creative Commons Videos on YouTube.
- Sell Digital Products.
- Sell Physical Products.
- Resell Stuff Online.
- Freelance Writing.
- Join Google AdSense.
- Display Ads on a Website.