There absolutely are passive income ideas and opportunities that work — if you do. And that’s the dirty little secret of passive income: most of it isn’t passive right off the bat. You have to do some work to get things started, and then you’ve got to do some more work now and then to maintain the source of income once you’ve gotten things off the ground.
(If you’re looking for something completely passive, you’ll have to stick with things that meet the IRS’s definition, which states that passive income “can be generated only by a rental or a business in which the taxpayer does not materially participate.” Basically, own rental property, or buy or invest in a business that you don’t make decisions for or work in.)
But if you’re willing to put in some work up front, and do a little regular maintenance along the way, there are several ideas that might be right for you.
Some of the more common ones include:
- Writing articles for money
- Doing article marketing or blogging to promote affiliate links
- Writing an e-book once and selling multiple copies, or receiving royalties from a traditional book
- Creating a monthly membership web site
- Creating a internet-based or CD/podcast-based course & selling copies
- Holding a webinar once that refers folks to products you sell or make a commission on, and then replaying the webinar on demand or at regular intervals later
- Selling stock photography
- Creating and selling a smart phone app
- Having a vending machine business
- And more
Things to keep in mind
When choosing an idea, keep your skills and the amount of time you have available in mind. Some passive income ideas require relatively little work to get started, but others require a great deal of time and energy up front.
For example, you could probably write one or two articles a month on a variety of subjects in your spare time fairly easily, and gradually build up a stable of articles that are generating you income — but your income is likely to be very low for quite a while.
On the other end of the scale, creating an online course that attracts lots of students will likely require in-depth knowledge of a particular subject, significant marketing efforts, and at least a little bit of money to get started with a web site. Other things turn out to be not nearly as passive as they might seem, like my Pay Off Debt app that requires regular time for testing updates, and time spent marketing the app and responding to customer emails. Those ideas can still be a lot of fun though, and they’re passive in the sense that they’re not a complete dollars-for-hours trade like a 9-5 job would be.
No matter what you choose, remember that you’re unlikely to get rich from passive income ideas overnight, if at all. But don’t sell yourself short. Given time, you can make a steady income that gradually increases while the amount of work you have to do to maintain that income either decreases or stays the same. And that’s pretty nice.
Want to know more? Check out taking passive income from idea to reality.Posted in Make Money on 02.28.11 with 34 comments.