Passive Income: A Beginner’s Guide To Making Money While Asleep

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Passive income is the concept of earning a regular income without additional effort. It means you get to earn income while you sleep, watch tv, exercise, and go about your normal life.

It is a concept that has been around for many years but has become even more popular because of the internet.

Now, thanks to the internet, we have more avenues and ways to make money. The internet has opened up countless opportunities to generate passive income on a massive scale.

If you are one of those people who want to change your financial situation over the next couple of months, then stay tuned. We have some life-changing information for you.

Why Is Passive Income Important

If you ever want to become rich, exchanging labor for income is not the way to go. It limits your options and takes a toll on your body. You want to be able to make money even if you’re not working. That’s where passive income comes in.

Having multiple sources of income that don’t require your presence or labor is the ideal way to get rich. That’s why it’s important to learn about making passive income.

We’ve made a list of pathways to making money while you sleep. You don’t have to do everything on this list. You can take one of the ideas and run with it. Once everything is going right, you can explore the other options. Remember, the key is to have multiple streams of income.

25. Invest In Real Estate – Use CrowdFunding

Don’t get scared by the “invest” word. Contrary to what you might believe, investing in commercial real estate does not require hundreds of thousands of dollars. You can become a commercial real estate investor by investing just $500.

You do so by joining a pool of small investors in a process called Real Estate Investment Trust (“REIT”). REIT is a process that allows individuals to invest in large-scale, income-producing real estate.

REIT’s are companies that allow you to invest in a real estate portfolio without a substantial financial outlay. They are usually publicly traded companies, which means anybody can buy shares in a REIT and become a real estate investor.

The great thing is you get to benefit from owning shares in a real estate without any of the accompanying duties that are attributed to the landlord.

It is a great way to put your money to work and make some passive income. According to Investopedia, REIT’s generates an 11.8% average annual return. That’s better than the APY on your savings account.

Best REIT Companies For Real Estate Investing

Fundrise is one of the leading real estate investing companies. With as little as $500, you can become a real estate investor.

Rich Uncles collects rent on their commercial properties and distribute it to their shareholders as dividends every month.

Realty Shares also allows individuals to join in a pool with other real estate investors. However, the minimum investment is $10,000.

24. Become A Silent Partner In A Profitable Business

Passive income is all about making your money work for you. An excellent way to make your money work for you is to buy equity in someone else’s business. You do this by becoming a silent partner or shareholder.

Being a silent partner means even though you don’t run or publicly associate with the business, you get to share in the profits.

With someone else doing all the work of running the business, you’ll have time to do other things like play golf or relax on the beach.

23. Sell E-books Online

Have you heard about self-publishing? If you haven’t, don’t worry, that’s about to change.

Selling e-books online is a phenomenal way to make passive income. Sure there’s a lot of work that goes into writing a book. But the good thing is you don’t have to personally write the book.

There are thousands of ghostwriters with expertise in various subjects who will gladly do the work for a fee.

Back to self-publishing; it is a process where you independently publish your work at your own expense. It is revolutionary because it makes it possible for anybody to publish a book.

You no longer have the big publishing companies serving as gate-keepers and preventing your from achieving your dream.

Where To Find Ghost Writers For Your E-book

Fiverr is a great place for finding ghost writers.

Textbroker, Iwriter, Upwork, and Freelancer are also great places to check for ghostwriters.

How To Make Money Selling E-books

Once you write your book or get it written for you, you can start making money by selling on the Amazon Kindle. Other places you can sell your e-book are the Apple iBook store, and the Barnes & Noble e-book store.

Income from e-book sales is truly passive because you only get to do the work once, after that, it’s all cash flow.

22. Open A Free High-Yield Savings Account

We’ve always heard the major banks talk about paying interest on your savings accounts. But have you ever stopped to find out what their rates are?

Well, I’ll tell you. The APY on a Bank Of America Rewards savings accounts is 0.03% – 0.06%.

You don’t have to settle for those extremely low interest rates. It is abysmal compared to the other banks. There are banks that offer APY over four times the national average. Here are a few of them.

Ally Bank
Marcus of Goldman Sachs
CIT Bank
American Express Personal Savings
HSBC Direct Savings

All of the above listed banks pays over 2% APY.

Why would anyone settle for 0.03% APY when they can get in excess of 2% APY?

I’m not telling you what to do with your money, but it seems logical, as long as we are talking passive income, that you’d go for the much higher APY.

21. Peer to Peer Lending

Why do you think banks and other financial institutions are anxious to lend you money? It’s because they make a boatload of money on the interest you pay.

What if you could beat the bank at their own game and lend directly to the customer? Well, all that interest that should have gone to the bank will come to you.

But here’s the catch. You don’t have a ton of money to lend to people, how could you possibly compete?

That’s where peer-to-peer lending companies come in. You can join a pool of lenders, combine your money, and start lending.

There’s a lot of money to be made from this, and the company below is a leader in this area.

Lending Club. Lending Club is one of the companies that come to mind when I think about peer-to-peer lending.

Here’s How Peer To Peer Lending Work With Lending Club

You invest in the company by buying notes. These notes correspond to a fraction of loans given to customers. When the customer pays, you get a return of up to 8%.

These loans are given to people with very low credit risk so you don’t have to worry. Go to sleep and let your money work for you.

Other peer to peer lending companies are:

Upstart
Funding Circle
CircleBack Lending
PeerForm
StreetShares

If you have some money lying around in low interest paying savings accounts, you should considering investing in peer-to-peer lending. You will generate significantly more passive income than the traditional savings account.

20. Start A Blog

The first thing to do when starting a blog is to get a domain name. Use the portal below to find a perfect domain name.

Once you’ve selected a domain name, the next thing is to host your domain with a stable hosting company. Bluehost is the company to use if you plan on a successful blogging career.

How Do Blogs Make Passive Income?

Most blogs make money by one or a combination of the following methods:

Sponsored post. Companies pay you to write an article about their business.
Advertisement. The blog gets paid when someone advertises on its website.
Affiliate Marketing. The blog promotes other people’s products and gets a commission on sales.
Sale of courses. The blog sells courses.
Sale of e-books. The blog sells e-books.
Sale of products. The blog sell products like mugs, t-shirts, and other physical products

All of these different streams of incomes are considered passive income. That’s because once your products or articles go live, you can go to sleep and wait for the money to come rolling in.

Check Out This Tutorial and Resource page On How To Start A Blog

Here is a detail tutorial on how to start a blog along with all the resources you need to be successful.

READ:

19. Do Affiliate Marketing

Do affiliate marketing. I know it is easier said than done, but it’s not impossible. You can make tons of money with affiliate marketing. How do you think most blogs and podcasts make money? Affiliate marketing.

Whenever you hear a podcaster telling you to sign up for something using their “link” or “discount code”, the are doing affiliate marketing.

They will get a commission on every single customer who signs up or use that discount code to make a purchase.

How To Start Affiliate Marketing To Make Passive Income

Most entry-level affiliate marketers start with the Amazon affiliate program. You can sign up for a free affiliate account on Amazon and start promoting their products.

How To Promote Affiliate Products

If you have an Instagram, Youtube, or Facebook account, you can start promoting the products directly to your followers. Ask them to use your link to make their purchases.

You have to be careful because there are some laws and regulation around promoting affiliate products. For example, you are required by law in the United States to disclose that the link is an affiliate link. Secondly, Facebook does not allow naked affiliate links.

You can learn more about affiliate marketing here.

18. Start A YouTube Channel

YouTube is a powerhouse when it comes to making passive income. Videos that were posted in 2008 are still making passive income today. The creator of the video does not have to do any additional work, the work is done only once. That’s the magic of passive income.

How To Start A Youtube Channel

If you have a Gmail account, you’re pretty much eligible to start a YouTube channel. Go to this page and sign up for a YouTube channel using your Gmail account.

Once you get your channel, make sure you get a domain name for it too. You don’t know how big you’re going to get. It is better to put your ducks in a row.

Check for your channel domain name below.

How To Make Videos Your Your YouTube Channel

If you don’t know how to make your own videos, no problem. YouTube has millions of creative commons videos that you can start using right away.

Using YouTube’s creative commons videos is a delicate process. Take this course to teach you all about making money on YouTube without filming.

Of course, the primary way most people make money on YouTube is by filming their own content and then monetizing it.

You can start filming with your smartphone. You will be surprised to see the kind of things that go viral on YouTube. A channel about caring for your pet could get millions of views and make you thousands of dollars.

You don’t have to dwell too much on the kind of content you want to create. Just start recording things you are passionate about or record your everyday life. People like that kind of staff.

If you want to know how much your favorite YouTuber makes, check this website called Social Blade. Put the channel’s name in the search bar and get prepared to be amazed.

How Is YouTube Income Passive Income

Like I said at the beginning of this post, passive income is when you make money even if you’re not currently doing work directly related that income.

The videos you post on your YouTube channel will continue to make money months and years after you stop making videos. It doesn’t get more passive income than that.

17. Develop An App

When we talk about developing apps, the first thing that comes to people’s minds is the fact that they don’t know how to code. Not knowing how to code should not stand in the way of your dreams. Many successful founders of tech companies don’t know how to code either. You’re in good company.

If you have an idea, you can hire coders on Fiverr, Toptal, or Upwork to start coding up your dream idea. Once your app goes live, you can start making passive income by placing ads on it or by charging for membership.

16. Invest In Stocks

How do you think most millionaires multiply their money? Once you hit that million dollar mark, you have to figure out a way to stay there. Investing your money is one of the best ways to maintain your status. You can’t just keep your money in the bank.

Most millionaires invest their money in stocks. It allows them to increase their net worth when the stock value goes up. They also get paid an income when the company they invest in declares dividends.

But guess what? You don’t have to be a millionaire to start investing. You can start investing even when you’re just a student, or if you make minimum wage.

READ:

Stock Investing For People Who Don’t Have Money

Most people aren’t millionaires. In fact, most Americans are struggling to make ends meet. If you are one of those people who’s struggling financially, you can still build wealth by investing in stocks. Here are some of the best stock investing apps.

Robinhood
Stash
Acorns
Betterment
Fundrise
Stockpile
Ally Invest

You don’t need a lot of money to start investing. Most investors start small. You can buy stocks for as low as $5 a share, and start to build your investment portfolio.

15. Use Your Cash Back Credit Card

You can earn passive income by using your cash back credit cards. Cash back credit cards usually pay between 1% – 5% on eligible purchases.

If you make a lot of purchases in your everyday life, rather than using your debit card, use your cash back credit card and make some passive income.

Best Cash Back Credit Cards

According to Credit Sesame, these are the best cash back credit cards. You should check them out.

Blue Cash Everyday Card From American Express
Chase Freedom Card
Capital One Quick Silver Cash Rewards Credit Card
Blue Cash Preferred Card From American Express

14. Advertise With Your Car

One way to earn passive income is to use your car as an advertising canvas. There are companies out there that are willing to pay up to $452 per month to advertise on your car.

Wrapify. That’s the name of the company, and this is how they work. First, download their app, drive around with the app, and they’ll match you with an advertising campaign.

Depending on how much advertising “wrap” you want to put on your car, you can make anywhere between $196 – $452 a month.

Another company that does a similar thing is Carvertise. Just like Wrapify, Carvertise pays you to place advertising decals on your car.

High mileage cars are particularly desirous because the more they’re on the road, the more the ads get seen. This can translate to more money for the car owner too.

13. Rent A Room In Your House

Passive income from renting a room in your house

Airbnb. Have you heard about it? You probably have. For those of you who don’t know Airbnb, it is a company that allows you to list your home or vacant room on their website for the purpose of hosting guests. You get paid in return, just like a hotel or motel.

Listing your vacant room on Airbnb is a great way to earn passive income. It is also an effortless process.

Rather than letting the room remain vacant, why not list it and make some money!

You can sign up for Airbnb right here.

12. Sell Stock Photos

Do you have one of those fancy smartphones that take fantastic pictures? If you do, you have an opportunity to make some money.

There are companies that will gladly pay you for the pictures you take on your phone.

Shutterstock and Istockphoto are just two of those companies.

All you have to do is sign up with them and start making money for your pictures.

11. Make A Plugin And Sell It Online

A plugin is a piece of software that extends the functionality of a program. Think about plugins for WordPress, Photoshop, Premiere Pro, or Final Cut Pro.

Themeforest, which is one of the biggest platforms for selling plugins, have paid over $725 million to their sellers.

Selling plugins is genuinely passive income at its best. That’s because you develop the plugin once, and get to reap the rewards for years to come.

How To Develop Plugins

I understand that developing plugins is not for the average joe. However, if you have an idea, there are many places to find competent developers to bring your idea to life.

Fiverr, Upwork, and Toptal are great places to hire freelance developers to work on your ideas.

If on the other hand, you want to learn how to develop plugins yourself, then I recommend Udemy.com. They have amazing courses that will take you from novice to professional in no time.

10. Create A WordPress Theme

Just like creating a plugin, developing a WordPress theme is a phenomenally great passive income idea. All you have to do is develop the theme once, and you can start making money for years to come.

Of course, you will have to update your theme occasionally, but that doesn’t require a lot of work.

Up to 29% of the web is powered by WordPress. So getting into this business as a means for passive income is a great idea.

How To Develop A WordPress Theme

You can learn how to develop WordPress themes on platforms like Udemy. If on the other hand, you want to hire someone to code it for you, then Fiverr, Upwork, and Toptal are great places to look.

9. Start A Membership Website

A membership site makes money through paid membership. Think about websites like Match.com, SEMRush.com, or Tinder.com. People pay a fee to belong to these online communities.

Think about it, the only major work after the platform is built is sales and marketing. These websites go on to make tons of money while the creators sleep or goes on vacation.

A membership website is a very low-maintenance online business. Getting it off the ground and creating awareness is where the work is. After that, everything else becomes smooth sailing.

The owners can lay back and make their money completely passively.

8. Buy A Business Franchise

There are lots of small businesses up for sale in your city. A simple Google search for businesses for sale in your city will give you a wealth of useful information.

However, have you considered buying an already profitable franchise business? Businesses like Subway, MacDonalds, Wendy’s are always selling franchises.

Advantages Of Buying A Franchise Business

One of the main advantages of owning a franchise is you don’t necessarily need to know how to run a business. The corporation behind the franchise will provide all the training you need.

Secondly, franchises have a higher rate of success. They also have an established reputation.

How To Make Passive Income From A Franchise Business

Franchises already have a business model and set of systems and procedures that work. You don’t have to be physically present at your place of business for it to operate. You can hire staff and managers to run your business while you go about your daily life.

Remember, the rationale is about freeing up your time to create other passive income streams. You can’t create multiple sources of income if you are tied down to only one.

7. Become An Angel Investor

An angel investor is a person who provides start-up capital for a business. In return, the investor usually gets equity in the business.

How An Angel Investor Makes Passive Income

There are multiple ways an angel investors can make money on their investment.

Angel investors can make money when the start-up goes public, or when the start-up gets sold, or even when they sell their interest in the start-up. They can also make money when the start-up declares a dividend.

If you have some extra money lying around in your savings account, you might want to consider angel investing.

6. Build A Certificate Of Deposit Ladder

A Certificate of Deposit (CD) ladder is an investment strategy in which an investor puts equal amounts of financial resources in various CD with different maturity rates.

The rationale for doing this is that you get higher interest rates, and your cash is available to you at frequent intervals.

Here are some CD rates to consider.

Marcus by Goldman Sachs

Barclays

Synchrony

5. Use A Cash Back App To Shop

Cashback apps are shopping apps that give you a percentage of the amount you spend shopping online.

You will not make thousands of dollars using these apps, but you’ll undoubtedly make enough to buy gas and groceries.

Ebates and Ibotta are some of the leading cashback apps. All you have to do is sign up for Ebates or Ibotta and start earning money.

4. Start An Online Store

Have you heard of Shopify? You can make a boatload of money with a Shopify online store.

Do you have an idea about something you want to sell online? Shopify is the best platform for making your dreams come true.

Take Sara Titus for example, she sells printable items on Shopify and she makes over $433,000 a month! Yes, you read that right. She sells printable on Shopify and makes over $433,000 a month.

Sara Titus sells printable on Shopify and makes over $433,000 a month.
-Sara Titus blog

Get 14 Days Free Trial When You Sign Up For Shopify

If you sign up using this link, you will get a free 14 days trial to start your online business.

3. Start A Vending Machine Business

If you’ve ever seen how a vending machine operates, you’ll understand why a vending machine business is a truly passive income. Once you load the vending machine with your merchandise, your work is done; the vending machine handles the rest.

Vending machines are a true definition of how passive income works.

How To Start A Vending Machine Business

To start a vending machine business, you will first need understand the kind of vending machine you want to use. There are many different types of vending machines.

Next, you will have to select the most profitable location for your machine. You want to select a place that has a lot of traffic.

Then select the right kind of products to stock in your machine. Only certain kinds of products will resonate with your customers. The old saying, “know your customer” is very true in this regard.

Once you have all these three steps in place, the sky will be the limit for what you can achieve.

2. Rent Your Car Out

According to Fortune, we parked our cars 95% of the time. They say time is money. Instead of being parked all day, what if you could put your car to work and earn some money?

GetAround is an app that allows you to rent your car to people and make some extra money.

According to AAA, in 2017, the average annual cost of owning and operating a car in America was about $8500. It’s fair to say that number has increased in 2019.

You can recoup some of that cost in when you rent your car.

Insurance With Getaround

One of the first things people worry about when it comes to renting a car is insurance. Well, Getaround has taken care of that. All rides in Getaround rented vehicles are fully insured – for up to $1 million. Coverage includes uninsured motorist protection, liability, property damage, and collision.

Earn Money With Your Idle Car

Think about it; most cars in America are idle for up to 22 hours a day. You commute to work and park your vehicle, you commute back home and park your vehicle. Why not put your vehicle to work and earn some extra cash?

Sign up for Getaround right here.

1. Outsource Your Online Business

You can start an online business and outsource the management of it. There are several kinds of online businesses you can start.

For instance, you can start a WordPress website development business and outsource the actual work to freelancers on Fiverr or other freelancing platforms.

You can also start a business doing graphic design, writing, digital marketing, video and animation, or programming. You don’t necessarily have to do the work. All you have to do is get the contracts and outsource the work to the freelancers.

I hope you can take one or more of these ideas and run with it.

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