Thinking of retiring early? Dreaming of having financial stability that would allow you to do whatever you want and then some in your golden years? The vision of a life free from mandatory work schedules, where your days are your own to fill with hobbies, travel, or time with loved ones, is a powerful motivator. Everything can be accomplished if you just think outside of your 9 to 5 box. This means you should not rely solely on your current income from your current job, which is subject to economic shifts and corporate decisions, but actively plan for other ways to earn some money and build a more resilient financial future.
What would you say about passive income?
What is passive income, you ask? It is an alternative to the main, or active, income stream, which requires a lot less ongoing, daily effort to maintain. While active income is what you earn from your day job, passive income flows in from assets you’ve built or acquired. You won’t have to spend so many hours on the job, but it will require some commitment and involvement on your part, especially at the beginning. This initial investment can be either time, money, or a combination of both. But if you do things right, your passive income stream might grow substantially over time, potentially making you richer than expected and accelerating your journey to financial independence.
Passive income ideas to earn money in 2024
There are numerous ways to make more money, many depending on one’s area of expertise, skills, opportunities, available capital, and risk tolerance. The perfect strategy for one person might be a poor fit for another. To prevent you from running through too many options, and not knowing what works best for your specific situation, we’ve compiled a list with the most prolific and solid passive income ideas. Take a look, consider which ones align with your resources and goals, and have your pick!
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Buy real estate
One very efficient and time-tested way to make passive income is to invest in real estate. Subsequently, you can rent the property to tenants and enjoy the benefits of consistent monthly cash flow and long-term appreciation. The best strategy, if possible, is to get rid of your own property debt and buy the investment property with cash. If you don’t pay off your home first, purchasing a new real estate might bring more financial strain and trouble than money, as you’ll be juggling multiple mortgages.
If we are to be honest, purchasing and managing real estate is not completely in line with the definition of “passive” income, at least not initially. That’s because you have to do some things to keep your property in check: performing market research to find the right property, securing financing, and then handling maintenance, cosmetic upgrades, marketing the vacancy, screening tenants, and general management. To make this venture truly passive, you could hire a reputable property management company. They’ll handle the day-to-day operations for a percentage of the rental income, freeing up your time. It does take a bit of your time or a slice of your profit, but the long-term financial return will make it all worthwhile.
Read also:12 Easy Ways To Receive Gift Cards for Free
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Rent out your house
Speaking of properties, if purchasing a separate investment real estate is not an option for you, you can always turn your current home into a source of income. This is often called “house hacking.” If you have a spare room that you no longer use, rent it out. If you don’t mind sharing your space, you can either opt for a long-term, permanent roommate who provides steady monthly income or the more flexible, classic Airbnb guest for short-term stays, which can often yield a higher nightly rate.
However, you should know that hosting on platforms like Airbnb can come with some minor issues and requires active management. First, guests might not be on the same page with you in terms of cleanliness, noise level, privacy issues etc., requiring clear communication and house rules. Secondly, you’ll have to clean and sanitize thoroughly after every guest checks out and prepare the room for future check-ins. This turnover process can be time-consuming. In addition, you’ll have to take some money out of your pocket for various replacement and maintenance jobs that might arise in between check-ins, such as restocking supplies or fixing wear and tear.
The takeaway here is that renting a room or listing your space on Airbnb can be quite profitable but make sure you find out all the pros and cons first. Research local regulations and tax implications, and be prepared for the hospitality aspect of the job to ensure you get great reviews and consistent bookings.
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Invest in real estate investment trusts (REITs).
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Store other people’s things
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Rent out useful items
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Rent out your vehicles
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Advertise on your car
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Start a blog or YouTube channel
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Invest in dividend-paying stocks
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Create and sell a digital product
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Say being a hands-on landlord is not your thing, but you still want to capitalize on the property market. You still have a profitable option with real estate. Have you ever heard of real estate investment trusts (REIT)? It’s a type of mutual fund, traded on stock exchanges like a regular stock, in which your money is placed together with other people’s money to purchase and/or finance a portfolio of income-producing properties. This could include apartment buildings, office towers, shopping centers, and hotels.
REITs offer the benefits of real estate ownership—like potential appreciation and rental income—without the headaches of being a landlord. Again, REITs can be most profitable if you no longer have high-interest debts on your own. And to make sure you choose the best REIT for your portfolio, it’s recommended that you discuss it with a financial professional before investing your money. That’s because some REITs buy real estate using significant debts, which is way riskier for investors such as yourself, while others are more conservative. A professional can help you understand the different types and their risk profiles.
Storage space is always an issue, no matter how big your house is (no, we’re not talking about mansions!). Most people have a lot of things that need to be stored—from seasonal decorations and sports equipment to furniture during a move—and wouldn’t say no to cheap, local storage solutions. If you happen to have some extra, unused space in your attic, garage, or basement, you can help yourself with some extra money by helping others with their extra stuff. This is a brilliant way to monetize space you aren’t even using.
To get a good start, check specialized websites such as Neighbor, iStoreit or Store At My House. These platforms connect people who need storage with those who have it, handling payments and providing some level of protection. Learn how to cash in on your indoor or outdoor space. You can even use a carport space or a spot in your driveway for boats, campers, and vehicles that people need stored and weatherproofed. It might not seem like a big amount on a monthly basis, but in time, your storage services will bring you a nice, steady passive income with very minimal effort.
Take a look around your home, garage, or shed. If you have certain items that other people might find useful but don’t want to buy for a one-time use, rent them out. Whether it’s a trailer for moving, a power washer, a high-quality chainsaw, a party tent, a set of folding tables and chairs, or even your backyard for a small event, these can bring you profitable rental deals. The sharing economy is booming, and your underutilized assets can become earners.
If you’re more of the sports type and have gathered expensive sports equipment such as surfboards, bikes, kayaks, and skis, check out websites such as Spinlister. Another popular and more diverse rental website is the Fat Llama., where you can upload photos of your items, set your rental price, and manage bookings. Or you could always stick to a smaller community at first, and rent to familiar people only, like your neighbors, using community Facebook groups or a simple flyer.
Whether you advertise your items online or just among your neighbors, use flyers or make online posts on social media, make sure you have certain terms of use spelled out in a simple rental agreement. Consider requiring a security deposit to cover potential damages. The idea is to make money out of your items but not at the expense of having to buy new ones due to misuse or damage.
Extra rooms and storage areas are not the only ones that can turn into sources of passive income. You can also make some extra money if you have an extra car, truck, or even an RV that you don’t use on a daily basis. Turo is a specialized website that facilitates the peer-to-peer renting of vehicles owned by locals to tourists or others needing temporary transportation. You set the price and availability, and the platform handles the booking and insurance.
Don’t limit the rental service to just cars. Recreational vehicles (RVs) and campervans can command high rental fees. Boats can also be rented out for a few hours or during the weekend. Websites such as Boatsetter can help you have your start in the marine rental market. Nevertheless, keep in mind that renting your vehicles to strangers might incur extra insurance coverage and will definitely require additional costs for maintenance and thorough cleaning between rentals to keep your asset in top condition.
Make sure you also take a look at these 10 Things Frugal People Never Do and Neither Should You!
Making money while behind the wheel of your own car during your regular commute? What could be better than that? If you don’t have any problems with driving around town with a giant logo on your car, you can essentially turn your vehicle into a moving billboard. Websites such as Wrapify can help you cash in on your vehicle by connecting you with brands looking for this kind of advertising space.
The process is simple: you sign up, they track your driving habits via a mobile app, and if you match a campaign’s needs, they will professionally “wrap” your car with ads. If you’re afraid to give up your cool guy image by turning your car into a mobile billboard, just know that you can be way cooler with more money in your pocket and little to no effort on your part. Wrapping your vehicle can bring you around $250–450 a month, depending on your location and how much you drive! Talk about passive income!
Yes, you can do it too, no matter your age or technical skill level. The key is to have a passion or expertise in a specific area. If you have something useful to say or a skill to demonstrate that might help other people improve their life, lifestyle, relationships, finances, or time management, now’s your chance to share it with the world. This could be anything from gardening tips and home repair tutorials to financial advice or cooking demonstrations.
For instance, educational, “evergreen” blogs and channels do not need constant, trendy content to generate traffic. If what you post is interesting and valuable enough to be accessed on a daily basis, you can start monetizing your traffic by selling ad space or allowing platform-placed advertisements. Beyond ads, you can earn through affiliate marketing (recommending products and earning a commission), selling your own digital products, or securing sponsorships. It’s only difficult in the beginning when you need to build an audience and become visible to as many people as possible.
After that, once you have an already established image and a library of quality content, you can just enjoy the money coming from every person accessing your blog/channel. However, you need to keep in mind that the online world is not as simple as a click. Competition is fierce out there so updating your content periodically and keeping it engaging is crucial to maintain and increase online traffic and your income.
For a truly passive income stream, it’s hard to beat dividend stocks. When you purchase a share of a dividend-paying stock, you are buying a small piece of a company. As a part-owner, you are entitled to a portion of the company’s profits, which are distributed to shareholders as dividends, typically on a quarterly basis. This provides a regular cash flow that is independent of your daily labor.
The beauty of this strategy lies in its simplicity and the power of compounding. You can choose to reinvest your dividends automatically to buy more shares, which in turn will generate even more dividends over time, creating a snowball effect. To get started, you can open a brokerage account online. For those wary of picking individual stocks, consider investing in a dividend-focused Exchange Traded Fund (ETF). An ETF holds a basket of many different dividend stocks, providing instant diversification and reducing your risk. While stock values can fluctuate, a long-term strategy focused on stable, established companies can provide a reliable income stream for years to come.
If you have specialized knowledge or a creative skill, you can package it into a digital product that you create once and sell over and over again. This is a powerful form of passive income because, after the initial creation effort, the sales process can be almost completely automated. Examples of digital products include e-books, printable planners or checklists, online courses, website templates, stock photography, or even audio files like music or sound effects.
The first step is to identify a topic or product that people are willing to pay for. Think about what problems you can solve for others. Once you have created your high-quality product, you can sell it through various platforms. Online marketplaces like Etsy are great for creative goods and printables, while platforms like Gumroad or Podia are designed for creators selling e-books and courses. Alternatively, you can sell directly from your own blog or website. While you will need to put in some marketing effort upfront to make people aware of your product, the potential for earning money while you sleep is immense.
