You can earn passive income through investments, renting out space you aren’t using, upcycling products and rental properties.
If you want to earn more money but have minimal time to commit to a second job or side hustle, look into passive income. This helps you increase your cash flow while allowing you to focus on your career and can provide greater financial security for the unknown, such as a job loss or surprise expense.
Passive income can help turn your passions or talents into extra cash. Review Benzinga’s list of passive income ideas to find a good fit for you.
What Is Passive Income?
Passive income is money you earn outside your everyday employer or a contract role. It comes from rental properties or a business venture you don’t need to spend regular time on. Common scenarios where you can earn passive income include stock dividends or royalties on content you created.
Often, passive income comes from sources you have done upfront work on. But that doesn’t mean there is no ongoing work; it is minimal.
For example, if you own a rental property, the big work is purchasing it and getting it ready to rent. But you must maintain the property moving forward to keep the money coming in.
In summary, passive income is not your job, a second job, or buying and selling non-dividend stocks. It is any side hustle that doesn’t require daily work to earn money.
Passive Income Ideas for 2024
As you look for ways to boost your monthly income without the time constraints a side job can have, consider these options for generating passive income.
1. Invest in Property
A rental property is a great way to generate passive income. The largest setback to this option is that you must invest a lot of money to get this passive income up and running. Selecting a good property is also complex because you’ll need to evaluate its total costs and how much rent you can charge. That will tell you how much passive income it will earn you each month.
2. Take Photos and Sell Them
Stock photography is in high demand. If you are a talented photographer, you can repeatedly take photos and sell them. And once you’ve taken the pictures and listed them, you can earn income from the products while you sit back and relax. However, you’ll want to keep looking for opportunities to snap new photos and list them for sale to increase your income. Consider photos in the highest demand and look for opportunities to capture those moments. If you own a newer smartphone, you don’t need to invest in anything to start this passive income stream.
3. Purchase Dividend Stocks
When you own stocks that pay dividends, you receive regular payments from the company. Most pay quarterly based on the company's profits. You don’t have to do anything to earn these dividends outside of simply owning the stock. Since dividends are based on the number of shares you own, the more you can afford, the higher the quarterly payout. The setback to this passive income stream is that you need money to invest in it, and selecting the right stock can be complex.
4. Rent Out Your Home While You’re Away
When you go on vacation or away visiting family, rent out your home. That way, you can pay for your vacations using an asset you already have. While this does involve allowing strangers to use your items, it can generate nice income with minimal work.
If you have spare bedrooms or spaces you are not currently using, you can also rent them out temporarily or on a long-term basis, such as to a college student needing reliable, affordable housing.
5. Build a Blog or YouTube Channel
If you’re an expert in something, you can start a blog or YouTube channel that shares that expertise. Perhaps it’s about travel or explaining how to get into your profession. As you build your content and attract an audience, you can earn money from the content through ads, affiliate marketing and sponsorships.
The largest setback to this strategy is that it takes time to start paying off. It requires a great deal of work at the onset and has no guarantee of a payoff.
6. Rent Equipment and Tools You Own
Look around your home at the items you aren’t using regularly and start renting them out. You can earn passive income on items like power tools and tents by renting them out between uses. Baby equipment is also in high demand when people travel.
You’ll need to find convenient places to list these materials for rent and a way for users to pick them up and pay for them. Regarding passive income, a fair amount of work is still required to coordinate pickup and return. There’s also the risk that your equipment gets damaged.
7. Invest in a CD
If you have extra money sitting around and aren’t sure what to do with it, invest in a CD. This is a good place to start making your money work for you because there is no risk of losing your principal — the money you put into the account. You can choose a short-term option or a long-term one, as long as you are confident you won’t need the money during the term.
8. Sell Products
If you’re skilled in some form of upcycling, you can make a nice side income that way. Look for underpriced products on sites like eBay or Facebook Marketplace and resell them in your community. Or you might use your refinishing skills to find old furniture that people are getting rid of and make it look new again to resell for a much higher price. This requires a unique skill set and an understanding of what junk is and what still has potential.
As far as passive income goes, this is one of the more labor-intensive options. It will also require some trial and error as you find the best products to flip. During that trial process, you might lose money on purchasing the goods and paying for upcycling materials such as stain, varnish, or fabric.
9. Build a Course
If you’re an expert in your field or have a knack for something that others want to learn about, you can build an online course that shares that knowledge. Just make sure it is something others are willing to pay to learn about.
10. Write a Book
You don’t necessarily need to publish through a publisher. You can now sell your ideas on sites like Etsy, where downloadables have grown in popularity. You do need a concept to share though, that others are willing to pay for.
11. Build Spreadsheets
Put your Excel expertise to good use by creating visuals and calculations that others would want. Perhaps it is a budgeting spreadsheet or project schedule. Market the product through your network or use a third-party website like Etsy to sell it.
12. Open a Vending Machine Business
If you have a few thousand dollars to invest in a business, a new vending machine business can earn you a few hundred dollars per month with minimal work. While it’s a bit unconventional, it’s a solid side business.
This passive income stream's setback is that it requires regular maintenance to restock and check on the machine. Ideally, you’ll place it in a building close to your home or work so you can easily check in on it.
13. Lend Money Through Peer-to-peer Platforms
You can loan your money to peers through Upstart or LendingClub. You’ll then earn money on the interest on those personal loans. However, the loan is unsecured, meaning you could have nothing if the borrower defaults.
14. Sell Products Through Social Media
If you have a large social media following, you have the opportunity to market and sell products using affiliate marketing or ads. You’ll need several thousand followers and a frequent posting cadence to work with brands.
15. Sell Your Designs
Individuals with design skills can market their designs online through platforms like Zazzle. They can have those designs printed on shirts, mugs, bags, and more to appeal to retail customers. Or they can print and sell their materials to avoid the middleman and earn more income. However, as they take on more of the process, the income becomes less passive.
What Is the Best Passive Income Source?
The best passive income source is dividends. That’s because you don’t need to do anything to earn money. However, you need money to make money for this option. So if you have no capital to invest, renting out your equipment or space can help you generate income to invest in other streams.
How to make passive income with no money
To make passive income with no money, follow these tips:
- Document your skills
- Outline interest areas
- Find a platform you enjoy spending time on
- Leverage the technology available to you
- Discover early success to build income to reinvest
- Test various options to find what works for you
How to make passive income with money
Once you have money to build passive income, you should diversify your passive income through these strategies:
- Place money in various investments
- Ensure some passive income comes from safe, stable sources, such as a CD or high-yield savings
- Avoid placing too much faith in one income source
- Invest in various ventures
- Consider short-term and long-term investments
How Many Income Streams Should You Have?
You should have as many income streams as you can manage. That way, you are diversified and can weather poor economies or changes in consumer habits. The ideal number of income streams is seven, though, because it takes advantage of these sources: earned income, profit income, interest income, dividend income, rental income, capital gains income, and royalty income.
Increase Your Income Through Diversified Streams
No one passive income stream is right for everyone, and having multiple income streams is the best option for weathering economic changes and varying consumer interests. Start with low-capital options and begin to diversify as you build your income streams.
Frequently Asked Questions
How to passively make $2,000 a month?
You can passively make $2,000 per month with affiliate marketing, an online course, ebook sales, downloadable sales or influencer-sponsored posts.
How can I make $1000 a month in passive income?
To earn an extra $1,000 per month in passive income, rent out space you aren’t using, such as your basement for storage or a parking space in your driveway, while selling digital goods, such as a course or ebook. Once you have money to invest, dividend stocks are a wise move.
What is the easiest form of passive income?
The easiest form of passive income is dividend stocks. Once you find good stocks, they’ll pay dividends regularly — often quarterly.
How to make $5,000 a month passively?
To make $5,000 per month passively, you’ll need to diversify your income streams. It’s wise to have seven income streams that span all types of income.
About Rebekah Brately
Rebekah Brately is an investment writer passionate about helping people learn more about how to grow their wealth. She has more than 12 years of writing experience, focused on technology, travel, family and finance. Her work has been published in Benzinga, Hearst Bay Area, FreightWaves and Dallas Observer publications.