Alexey Zenkov
When someone is looking for an opportunity to receive extra income, most often he is advised to find a temporary part-time job. But what if you don't have the time or energy for this? In this case, you need to find ways to generate passive income - earning money with a small investment of time and effort on your part.
Try index funds
Index funds allow you to earn income from investing in the stock market completely passively. For example, if you invest in a fund based on the S&P 500 index, your funds will be invested in Common Market, and you won't have to wonder how to manage your money or whether to sell or buy shares of certain companies. All these points will be managed by the fund, which forms its investment portfolio depending on the state of a particular index.
You can also choose a fund that covers any index. There are funds involved in various business sectors - energy, precious metals, banking sector, emerging markets and others. All you have to do is decide for yourself that this is what you want to do, then invest the money and relax. From now on, your stock portfolio will run on autopilot.
Make videos for YouTube
This area is developing very quickly. You can make videos of absolutely any category - music, educational, comedy, movie reviews - anything... and then post it on YouTube. Then you can connect Google AdSense to these videos, and automatic advertising will appear in them. When viewers click on these ads, you will earn money from Google AdSense.
Your main task is to create decent videos, promote them in social networks and maintain a sufficient number of them to provide yourself with income from several clips. Shooting and editing a video is not that easy, but once done, you will have a source of completely passive income that can last for a very long time.
Not sure if you'll succeed on YouTube? Michelle Phan combined her love of cosmetics and drawing with making videos, gained more than 8 million subscribers, and now launched her own company with a capitalization of $800 million.
Try Affiliate Marketing and Start Selling
This is a passive income technique that is more suitable for owners of blogs and active Internet sites. You can start promoting any products on your website and receive a fixed fee or a percentage of sales.
Making money this way is not as difficult as you might think because many companies are interested in selling their products in as many places as possible.
You can find partnership offers either by contacting manufacturers directly or on specialized websites. It is best if the advertised product or service is interesting to you or matches the theme of the site.
Make your photos profitable online
Do you like photography? If so, you may be able to turn this into a source of passive income. Photo banks, such as and, can provide you with a platform for selling photographs. You will receive a percentage or flat rate for each photo sold to a website client.
In this case, each photo represents a separate source of income that can work again and again. All you need to do is create a portfolio, upload it to one or more platforms, and that's where your active work will end. All technical issues of photo sales are resolved using the web platform.
Buy high-yielding stocks
By creating a portfolio of high-yield stocks, you will receive a source of regular passive income with an annual interest rate that is much higher than the interest on bank deposits.
We should not forget that high yield stocks– are still shares, so there is always a possibility of capital revaluation. In this case, you will receive profit from two sources - from dividends and return on invested capital. To purchase these shares and complete the appropriate forms, you will need to create a brokerage account.
Write an e-book
Of course, this can be quite a time-consuming process, but once you write a book and publish it on marketplaces, it can provide you with income for years. You can sell the book on your own website or enter into a partnership agreement with other websites that are similar in theme to the book.
Write a real book and get royalties
Just like writing an e-book, there's a lot of work involved at first. But when the work is completed and the book goes on sale, it will become a completely passive source of income.
This is especially true if you manage to sell your book to a publisher who will pay you royalties on the sales. For each copy sold, you will receive a percentage, and if the book is popular, these percentages can add up to significant amounts. Moreover, these payments can last for years.
Mike Piper of ObviousInvestor.com recently did just that. He wrote the book "Investing in simple language", which was sold only on Amazon. The first book became so profitable that he created a whole series. These books total .
Get cashback on credit card transactions
Many credit cards offer cash back ranging from 1% to 5% of the purchase price. You still go shopping and spend money, right?
Such bonuses allow you to provide yourself with a kind of passive “income” (in the form of reduced spending) from actions that you perform anyway.
Sell your own products online
The possibilities in this area are endless: you can sell almost any product or service. It could be something you created and made yourself, or it could be a digital product (software, DVDs, or instructional videos)
For trading, you can use a specialized resource, if suddenly you do not have your own website or blog. In addition, you can enter into a partnership agreement by offering goods to sites on relevant topics or using platforms like (American marketplace for selling digital information products - editor's note).
You can learn how to sell products online and earn quite a lot from it. Maybe it's not completely passive income, but it is certainly more passive than ordinary work, which you have to go to every morning.
Invest in real estate
This method falls more into the category of semi-passive income, since investing in real estate involves at least a small level of activity. However, if you have a property that you're already renting out, it's mostly just a matter of maintaining it.
Additionally, there are professional property managers who can manage your property for a commission of approximately 10% of the rent. Such professional managers help make the process of receiving profits from such investments more passive, but they will take part of it.
Another way to invest in real estate is to pay off a loan. If you take out a loan to buy a property that you will rent out, your tenants will pay off that debt a little each month. When the entire amount is paid, your profits will increase dramatically and your comparatively small investment will turn into a full-fledged program for leaving your main job.
Buy a blog
Thousands of blogs are created every year, and many of them end up abandoned after some time. If you can acquire a blog with enough visitors - and therefore with enough cash flow– this can be an excellent source of passive income.
Most blogs use Google AdSense, which pays once a month for advertising placed on the site. To provide additional income, you can also enter into partnership agreements. Both of these income streams will be yours if you own a blog.
From a financial perspective, blogs typically sell for 24 times the monthly income the blog can generate. That is, if a site can earn $250 per month, most likely you can buy it for $3,000. This means that by investing $3,000, you can receive $1,500 annually.
You may be able to buy the site for less money if the owner really wants to get rid of this asset. Some sites contain “eternal” materials that will not lose relevance and will generate income years after publication.
Bonus tip: If you buy such a site and then fill it with fresh content, you will be able to increase your monthly income, and you will be able to sell the site again after some time for a significantly higher price than you paid when buying it.
Finally, instead of purchasing a blog, you can create your own. This is also a good way to earn money.
Create a website that sells
If there is a product that you know a lot about, you can start selling it on a specialized website. The technique is the same as when selling a product of your own making, except that you do not have to deal with the production itself.
After some time, you may find that you can add similar products. If this happens, the site will begin to generate significant profits.
If you can find a way to ship products directly from the manufacturer to the buyer, you won't even have to get your hands dirty. Maybe this is not 100% passive income, but it is very close to it.
Invest in real estate investment trusts (REITs)
Let's say you decide to invest in real estate, but you don't want to devote any attention or time to it. Investment trusts can help you with this. They are something like a fund that owns various real estate projects. The funds are managed by professionals, so you don't have to interfere with their work at all.
One of the main advantages of investing in REITs is that they typically pay higher dividends than stocks, bonds and bank deposits. You can also sell your interest in the trust at any time, making such assets more liquid than owning real estate on your own.
Become a passive business partner
Did you know successful company that needs capital to expand its business? If so, you can become something of a short-term angel and provide that capital. But instead of giving a loan to the owner of the company, ask for a share of the shares. In this case, the owner of the company will manage the work of the company, while you will be a passive partner, also taking part in the business.
Every small business needs a source of referrals to support sales. Make a list of entrepreneurs whose services you use regularly and whom you can recommend for cooperation. Contact them and find out if they have a system for paying for referrals.
The list could include acquaintances: accountants, landscape designers, electricians, plumbers, carpet cleaners—anyone. Be prepared to recommend the services of these people to your friends, relatives and colleagues. You can earn a commission on every referral just by talking to people.
Don't underestimate referral programs professional field. If the company you work for offers bonuses for referring new employees or new clients, take advantage of it. This is very easy money.
Rent out your unused property on Airbnb
The concept appeared only a few years ago, but very quickly spread throughout the world. Airbnb allows people to travel the world and pay much less to stay than in regular hotels. By participating in Airbnb, you can use your home to host guests and earn money extra money only through rent.
The amount of income will depend on the size and condition of your home and its location. Naturally, if your home is located in an expensive city or near a popular resort, the income will be much higher. This is a way to make money from free spaces in your home that would otherwise be empty.
Write an application
Apps can be an incredibly lucrative source of income. Think about how many people have smartphones today. Yes, almost everything! People are downloading apps like crazy—and for good reason.
Apps make people's lives easier. Whether it's helping you post pretty pictures or keeping track of tasks, there's always an app that's useful to someone.
You might ask: If there are so many apps out there, why would you try to create another one. Is there too much competition? This is all true, but fresh, creative ideas can benefit. If you can come up with something unique, you can make money from it.
Don't know how to program? No problem, you can learn. There are a lot of different courses on the Internet, including free ones. Alternatively, you can hire a developer to create an app based on your idea.
The end result is an application that will potentially generate relatively passive income.
Create online courses
Every person is an expert in something. Why not create an online course about your passion?
There are several ways to create and deliver your own online courses. One of the easiest ways is to use sites like
Due to numerous requests from readers... So get ready, pour yourself some tea or coffee, make yourself comfortable - this will be a voluminous, but very useful article! 🙂
How would your life be different if you made a few hundred or thousand dollars a month without actively working?
Perhaps you could get busy which you have always dreamed of. Maybe you would travel more around the world. Perhaps they would move to live in another country with a better climate and quality of life. Some would spend more time with their family and take more care of their health. And someone would combine All the above! And passive income allows you to realize these ideas.
The idea of passive income is so attractive for people all over the world precisely because it allows a person do more of what he likes and minimize what he doesn’t like.
Clarification
I want to immediately clarify one point - I have not come across any “passive” income. Almost every passive income requires some work, at least in the beginning, after which it can generate income for a very long time without requiring your active involvement. 
So, let's look at the main types of passive income.
Rent out real estate
You can purchase residential or commercial real estate for rent, or you can rent out the property you already own (for example: an apartment, house, cottage, garage, basement, attic, etc.). You can even rent out part of your home (for example, one of the rooms, using the service . You can get confused and pass through).
Rent out your home and move into a rented one yourself
Don't want to share your home with anyone? You can rent out your own, more expensive housing, and also rent another, but cheaper one yourself. The difference in these rents will be your additional passive income.
Sell your accumulated trash and junk
If you think that these are pennies that are not worth spending time on, look at how my wife and I for thousands of dollars! Many of these things have been stored since student days and have cluttered our house for years.
Turn your car into a means of earning money
You can rent out your car to taxi services, or you can use it as an advertising medium. Similar services have been present in big cities for a long time.
Deposits
Deposits are one of the easiest and an understandable way for the population to save money and earn passive income. It's simple - you give the bank your money for a certain period, for which the bank charges you interest. The return on deposits is usually low and does not cover inflation, therefore, this method of earning money is only suitable for short-term strategies.
If you know a subject (no matter what topic!), write an e-book and sell it on your website or on special platforms for selling e-books. Writing a book takes anywhere from a few days to 2-4 months, but once you write it and post it on book platforms, it can provide you with passive income for years.
Create a video training course
The idea is the same as with an e-book. If you are an expert in some field, record a training video course and sell it on special educational platforms (see the complete list of platforms for creating video courses ) or on your website.
Create or buy a ready-made online store
If you already have goods for sale or you know how to arrange supply, sales and delivery, it’s time to think about your own online store. There are services that allow you to set delivery, storage, accounting, sales, payment acceptance, discounts and promotions and even marketing.
Start your YouTube channel and make money from advertising
You can shoot simple videos(including on a mobile phone) - music, educational, comedy, movie reviews, equipment - anything!YouTube will show people ads before or while playing your videos, and you will receive money (with monetization enabled and AdSence connected).
Earn money from advertising on your site
If you have your own website, you can (should) enable advertising (AdSense or any other). This is done in different ways (read on the Internet) and is generally very simple. People come to your site, read or watch something, and are automatically shown an ad. You get paid for views and/or clicks from your readers. See examples of advertising at . Subscribe to my articles to see how it works in the articles :).
Credit card bonuses - No No No!
My readers know very well my opinion on plastic cards - do not deceive yourself with the attitudes “I pay off the debt on the card every month” or “I earn miles or cashback” and other nonsense. Just ask yourself the question, from what…. does the bank give you free money, miles, cashbacks and other goodies? 🙂 I explain in detail here: In a nutshell, try to get rid of this source of “income”, because... in the end you will lose much more than you earn. Trust the person who had more than 20 mega-cool cards))) Also read and watch:
Do you like photography and are you good at it? Then you can sell your pictures or videos through photo banks such as Shutterstock, Depositphotos and iStockphoto You will receive a percentage or flat rate for every photo or video sold through these photo banks. You upload your photos and videos to one or more platforms, and that's where your activism ends.
Microloans - NO NO NO!
Microloans are a disgusting tool for robbing financially illiterate and desperate people. People take a small amount “before payday” at 100-200 percent or more per annum, thinking “just think, the interest will be only 500-1000 rubles. It’s just pennies.” There are platforms that offer you to become a lender and receive a certain percentage from it. I won’t give links because... I am categorically against earning money that drives other people into a financial abyss.
Accelerated repayment of loans and debts
Every penny you pay to the bank is a penny that could be (passively) making you money! Debts, like termites, devour and destroy the financial well-being of a family. It is important to understand that for every dollar (ruble, etc.) returned ahead of schedule, interest will not accrue (for months or years in the future) and all these months or years you will be able toearn interest yourself rather than pay it to the bank.
Example: If instead of a 20-year mortgage, in the amount of 3 million rubles. (~ 50 thousand dollars. This is a studio or one-room apartment in St. Petersburg), taken for 20 years, at 12%, set aside the same money that you will pay monthly to the bank (the monthly payment will be 33 thousand rubles), at, say, 8% - in 20 years you would have accumulated an amount approximately equal to 20 million rubles (~300-350 thousand dollars) due to ! This amount would be enough to provide you with an income of 1.5 to 3 thousand dollars for the rest of your life per month! With that kind of income, you could live well in any country from east to west! By the way, this amount would put you in the 5-10% richest people on the planet! Make sure of this .
Change jobs
If you are sure that you are being paid below the market, attend interviews and change jobs! Thus, you will provide yourself with additional income for many years in the form of the difference between the old and new salary. This can be very scary to do, because... We, people, become attached to the team, to the work being done, to status, to various bonuses, to stability, etc. We are afraid to take risks and change something. However, every fear has a price! If you're losing hundreds or thousands of dollars a year, it's time to stop being afraid and start taking action!
Ask for a raise
You can change your job for a new one, or you can ask for a raise. If you find out (and don’t just think so) that you are objectively worth more, if you bring value to the company that you can evaluate and show to management, if you are not easy to replace, ask for a raise. Read: .
Get everything from the state!
Take everything from the state what it provides by law. You may not pay (that is, you will return this tax to your family) tax on purchased real estate (up to 260 thousand rubles or 4,300 dollars), for interest on a mortgage (390 thousand rubles or 6.5 thousand . dollars), for training and treatment, etc.
For example, my wife and I used tax deduction when buying real estate. This returned 130,000 rubles to the family (more than 5 thousand dollars in old money). We received all possible benefits for children, including maternity capital (450 thousand rubles or 7.5 thousand dollars).
In addition, you can getsubsidies(compensation) from the state to pay for utility services, to create/develop a business, payments to mothers under Maternity Capital certificates, try to get preferential housing (for some categories of citizens),social benefits for the birth of a child, etc.
You can buy a blog or a ready-made online business
Thousands of blogs are created every year and online businesses, and many of them end up abandoned after some time. If you can find and purchase a blog/online business with a sufficient flow of visitors, then you can make good money from it. Blogs typically sell for 24 times monthly income, giving a 4.2% (100/24) return (typically in dollars) - which isn't very high, but not very low, considering the rates on dollar deposits in banks. Plus, a blog or online business can be developed and earnings increased.
Participation in reviews, clicks and other online manipulations
Many advertisers pay money for certain actions on the Internet, such as: click on a link, leave a review, like, repost, fill out a form, etc. Accordingly, there are services (eg seosprint, v-like.ru, socialtools.ru, sarafanka.com, prospero.ru, smmka.ru, etc.), which can automate the process and connect advertisers with people who want to earn money in this way. However, calling such income passive can only be conditional.
Stock
A share is a A security document that gives its owner the right to a share in the company and to receive a portion of the profits in the form of dividends.
Company shares can be purchased through a broker. The entry threshold is usually very low. Earnings will consist of two components - the increase in the value of the stock (bought cheaply and sold more expensive) and also from dividends that companies (though not all) can pay to the owners of their shares. However, I do not recommend that non-professional investors buy shares of individual companies, because... Without significant experience and knowledge, such purchases will be similar to betting in a casino. The best solution for an inexperienced investor would be mutual funds or structured products offered by brokers. Such funds/products include many stocks, so a sharp drop in the value of one share will not significantly affect the decline of the entire fund/product.
Bonds/bonds
A bond is a fixed income bond.Essentially, it is a loan agreement between a lender (usually national governments, municipal governments and private companies) in which you lend a certain amount, for a certain period and at a certain interest rate.
The riskiness of this instrument as a rule, very low, but the profitability is also low. However, you can (often) make more money on bonds than on bank deposits. You can also buy bonds through a broker, but the entry threshold can be high, from a couple of thousand dollars.
Mutual funds
mutual funds or Mutual Investment Funds are a kind of pool of money from large quantity investors (like you, for example), which is managed by management company in order to increase the value of this fund.
Mutual funds can be selected to suit every taste- industry, “blue chips”, etc. The value of your share (the part you purchased in the fund) can go into deep minus and rapidly grow upward. Therefore, this is a long-term instrument, for investing for 5-10 or more years. The entry threshold can start from several tens of dollars or thousands of rubles.
ETFs and index funds
In developed Western markets(for example, American or European stock markets) you can invest in ( Exchange Traded Funds ) or to index funds (the same ETFs linked to a specific index). These instruments are usually tied to a specific type of asset (for example, blue chips, shares of fast-growing companies, oil sector companies, stock index of the largest American companies(for example, ““), etc. There are a great variety of them and you can choose to suit every taste and attitude to risk!
In Russian stock market also exist , incl. denominated in dollars, but the choice is terribly small (there are about 15 of them at the time of writing this article).
You can buy these instruments (in Russia) through brokers, which provide access to foreign markets and instruments.These are very cool toolsallowing you to earn 5-10 percent or more in dollars and get rid of country risk, which is very important for you and me :) Like mutual funds, ETFsThese are long-term instruments designed for investment for 5-10 years or more. The entry threshold is from a couple of hundred to several thousand dollars. These are my favorite passive income tools!
“A dollar saved is a dollar earned!” B. Franklin.
Perhaps none of the methods described above suited you, but there is one way to make money that is available to everyone! This . Saving on yourself is unpleasant. However, saving is “smart” when you save money, but do not noticeably change the lifestyle to which you are accustomed - even exciting and reckless. Hundreds of smart saving ideas .
Investment in yourself loved one!
In all my materials I write and say that money is always a tool (like an axe, hammer or brick), but not an end in itself. Therefore, the most inexpensive investments with the highest short-term and long-term returns are investments in yourself, such as:
- investment in relationships with your spouse, children, relatives, friends. For example, an unsuccessful marriage can put an end to all your investment desires for years and decades and ultimately ruin you. What do you do to keep your relationship alive?
— investments in health- these investments bring income, ranging from savings on the costs of doctors and medications, and ending with the fact that a healthy body greatly affects the health of the “brains”, your thoughts, mood, motivation, which, in turn, affects everything in including the ability to earn more and invest better. Watch me play sports for free.
— spiritual development- we, as a rule, leave this aspect to the very end, although in life it is almost the most important. Your spirit, your mood, your attitude towards life and other people, your life goals influence everything!
Not one alone!None of the tools described above individually will be correct and good decision to generate confident and reliable passive income. Remember - “don’t keep all your eggs in one basket”! As a rule, it is necessary to combine some the tools described above. Something like - part of the assets in cash, part in bonds, part in real estate, part in mutual funds/funds or structured products. At the same time, part of all assets must be in the national currency, and part must be pegged to (for example, the dollar).
Test before invest!And one more thing - no matter what you choose - “test before invest” & “try small” - which means “test, then invest” and “try on a small scale”. You don’t need to use all your money to buy one instrument (for example, shares of a company or mutual fund) that you have not tried before. Buy it for a small amount, try it, make sure everything works well and then increase your investment in this or that tool.
Break down the risks over time!An additional strategy could be to enter one or another instrument gradually - for example, buy such and such for a certain amount every month. This will help you reduce (but not eliminate) the risks of getting into a bad instrument and losing money.
When should you start creating passive income tools?
The sooner the better! Preferably from school, student, or at least your first job. But, if you haven't done it then, it's never too late to start doing this. It’s just that the sooner you start, the more powerfully (in your place) compound interest will work, whose power grows like a snowball, only after some time. Read the amazing story of Susan, Bill and Chris and you will understand what I mean.
BUT! There is one limitation.I recommend starting to invest only AFTER how you pay off all debts (except the mortgage) and create equal to 6 monthly income (or expenses, if that’s easier for you:). And only after that you can and should engage in investments, making money, etc.
One of the most effective tools for solving these two problems (getting rid of loans and forming a fire reserve) is.
Conclusion
As you can see, there are many types of passive income. Some are very easy to understand and cheap to get into, some are a little more complex and more expensive. You don't need to limit yourself to one tool and you don't need to try to fit into too many of them.
The main thing is not to “sit” forever in the asset, who earns less than inflation (like cash under your pillow or money on deposit), and learn to invest your money in profitable (and passive) instruments. And then, one day, your passive income will start earning more than active income, and you will be able to do what brings you joy for the rest of your life!
It will be useful!
Call to action
What can you do right now? Two things:
First.On your own or with help, make an annual budget for your family, set yourself the goal of “expeditiously paying off all debts except the mortgage” and “forming a Fire Reserve” of 6 months and make these two goals part of your budget.
And the second one!Meet with 2-3 large brokers in your country and city and ask them to tell you about the tools described above, taking into account your financial capabilities and risk tolerance. This conversation will be very useful and will energize you the necessary motivation make passive income!
Types of passive income are those in which the availability of stable financial income does not depend on daily work activities. Any of us has heard about people who live off such income - those who do not have to go to work. They are called "rentiers", that is, living off rent.
Rent is the income that the owner receives from fixed capital placed in real estate, deposits, securities, etc. “From the same opera” - sources of passive income associated with copyrights. By the way, the last option is not ordered to anyone these days. Everything is simple here: having created something once and registered the copyright on your own brainchild, you will have such royalties with each next sale.
If you are a professional (no matter what field) you have a real opportunity to monetize your own knowledge. Simply record the training course on video or audio and release it to the market.
Why are we not rentiers?
Today we will look at options for passive income and its possible sources. Its huge advantage is the freeing up of personal time, which can be spent on your favorite activities, family, relaxation, household chores or somewhere else. Anyone who works hard all day at work is almost completely deprived of such a wonderful opportunity.
Managing personal time at your own discretion does not mean wasting your life in entertainment venues, or lying on a warm beach - many people would be happy to engage in charity work, helping the sick and homeless, or creating works of art. To start making all these dreams come true, you need the most stable passive income.
Everyone has heard the expression “money to money.” What does it mean? Nowadays, it is not uncommon for a person, having a generally good salary, to “eat up” it completely, buy things on credit and borrow from relatives and friends from payday to payday. This continues for years and decades.
But why is this happening? It seems that the main problem of such people is that the idea of passive income does not even occur to them. They are not able to create an asset that will work for their well-being in the future. These people immediately spend everything they earn, and thus deprive themselves of the only chance to ever escape the captivity of financial slavery.
Do you recognize yourself?
Some of these consumers can be classified as “financial zombies.” These are those whose assets have long been a negative value. That is, their expenses are greater than their income. Debts accompany them throughout their lives. Having given one loan, they immediately take out the next one and so on.
The other category is a little more prosperous (but this does not make it any easier) - it tries to somehow correlate its expenses with the amount of earnings. They sometimes have a set of necessary goods - housing, a car, etc. Most of this was purchased on credit, which puts the owners in a dangerous and unstable position. After all, if any unforeseen financial circumstance happened, their well-being would crumble like a house of cards.
There is progress...
In contrast to the above categories, there are those whose assets can be considered positive. That is, their income is higher than their expenses. The majority of ordinary citizens from this group prefer not to have debts or reduce them to a minimum and even have some savings, but such saved finances do not play a fundamental role, since they accumulate extremely slowly and are located either under the mattress or (at best) on a savings account.
The most advanced of our fellow citizens are those who are haunted by the idea of passive income. They try to seize every opportunity to invest free funds and create their own additional financial source.
Let's turn to the authorities
Many people know the name Robert Kiyosaki. This investor and businessman has written a number of popular books on the basics financial literacy, which will not be superfluous for anyone to read. For example, one of the interesting and most effective tips from this author is as follows: the mistake of almost all of us is that, having earned a certain amount, we try to distribute these funds to anyone but ourselves. We pay rent and public utilities, but at the same time we leave nothing for ourselves. You should start with yourself by creating your own monetary asset. Subsequently, it will become the basis for investing in a business or another source of permanent income.
Another "pro" financial matters Rockefeller once said that a person who works full time has absolutely no time to earn money. Despite all the paradoxical nature of this saying, its wisdom lies on the surface - indeed, working in an office or in production, each of us is able to earn money for ourselves personally only by running costs to maintain daily existence. There is neither strength nor free time left for actions leading to wealth and prosperity.
The conclusion is this: the main resource is time, which any wealthy person knows well. The idea of passive income is based on the correct distribution of this invaluable asset. And only after achieving this can you begin to move towards financial success. Everyone knows that everyone who achieved wealth initially had a specific list of goals. Well, the third, most important component for creating passive income is active, targeted work over a number of months or even years.
The result should be legal opportunity Quit your unloved job and start living on dividends.
Passive income: examples and options
Now let's talk about the ways in which passive income is created. All its sources can be attributed to four types - investment (or financial), intellectual, marketing or legal (that is, the one that we are entitled to by law). Passive income in Russia is no different from that in any other country in the world.
We will receive passive income of a financial or investment nature if we invest in a certain financial instrument, which will bring us a certain percentage of profit. Sources of such investment may exist in the form of real estate, securities, bank deposits, our own business (if purchased), or equipment owned by us that can be leased.
The second of the listed options, called intellectual, arises, as mentioned above, through the creation and sale of any product mental labor. The information business, which is widespread on the Internet these days, is based on this principle. Many professionals in a variety of fields develop and design their own training courses, then release them for sale an unlimited number of times.
"Affiliates" is an interesting topic
In the same way, it is possible to purchase the rights to resell a similar product, which can bring no less income. This type of income is called affiliate marketing. Other sources related to this item may include royalties, patents for completed inventions or developed technologies.
Earning money from affiliate programs is an excellent way out for those who do not have too much hope in creating their own intellectual product - because this saves time and mental resources. You just need to join such a program or purchase the right to resell (resell) a selected book, video or audio course.
Other earnings without investment
Marketing passive income is the one in which you organize your own marketing system or several of them. An example of such a structure could be your own website on the Internet or a personal brand, the right to use which you can also sell. A combination of several of the strategies mentioned is also possible.
What is meant by the concept of a personal brand? This is a commercial use of a famous name. An example is filming, television and sports stars filming commercials. Becoming the “face” of a specific trademark, they get good money.
The fourth type - legal income of a passive nature - includes all cases when people, in addition to a certain (sometimes not too high) remuneration for their work, receive certain bonuses from the state. This could be, for example, early retirement with a guaranteed receipt, which is typical for the military, etc.
Going online
Creating a website for making money on the Internet (or blog). These days, this does not require a lot of complex technical knowledge and skills. You can make an acceptable website with your own hands by mastering the minimum information that can be easily and freely found on the Internet. There are many step by step instructions and video courses.
Of course own blog or the site will not immediately bring you monetary returns. To promote it and display it on acceptable level It will take at least six months, and most likely a year or two. All this time you have to work on own project on a regular basis, optimize it and bring it to mind. This work will take several hours daily. However, you can count on the first small revenues within a few months from the start.
Having created and promoted a website, you can sell it, and for a very good amount. It is quite possible for a person who has mastered this technology to organize his own business for the “production” and further sale of profitable Internet pages.
How do they make money on them? To the very popular ways refers to generating income by placing blocks of contextual advertising and similar articles on resource pages, of course, not for free. The sites place affiliate links and sell advertising space; they also actively offer training courses to customers, both their own and those of partners.
In a word, there are a lot of ways to use such a valuable resource as a blog or website on the Internet, and you always have the opportunity to choose something that suits you.
For those who are not deprived of intelligence
Creating a product that has the status of an intellectual product (this includes books, educational videos, new technologies, etc.) implies the presence of a certain talent, as well as a high level of professionalism in any of the fields.
If you are an inventor or developer of an industrial design that has become fundamentally new, then your labor products can safely be classified as intangible assets. This term refers to those derivatives of our intellect that generate income in the absence of a material form. Examples include trademarks, brands, or patented inventions.
Let's go down to earth
Income from renting out an apartment (or other real estate, if available) is a well-known and very common option. But there are others similar to it: it is possible to “let out” not only buildings or retail space, but also equipment related to a variety of industries - trade, construction or manufacturing.
And other expensive items (for example, automobile equipment) will bring you good dividends. Sometimes it is more profitable to manage equipment than real estate. In particular, by purchasing tools and equipment for construction, you will actually organize a good and quite profitable business, based on their rental. The payback on such activities is very high and in time significantly exceeds a similar indicator for rented real estate.
Do you want to become a shareholder?
Investments in securities (or other financial instruments, which include a huge number of banks, PAMM accounts, mutual funds) are a widely accepted practice these days. This activity is considered one of the types of business.
Replenishing the number of professional investors is not an easy task. This activity is quite complex and requires a competent approach, as well as quite serious training. Proficiency in financial instruments is impossible without a more or less acceptable education in this field, the ability to compare various flows of information, take into account risks and predict the situation.
Investments in securities have certain advantages compared, for example, with bank deposits, in the form of a higher level of profitability, but at the same time, the high risk of losing invested funds sometimes cancels out all the existing advantages. Having decided to plunge into the world of stocks, mutual funds and PAMM accounts, remember that with the exception of long-term loan bonds, stable income is not so easy to achieve here, and the risk of incurring significant losses is always quite high.
Everything can be sold!
A relatively simple and, perhaps, generally accessible option for creating a source of passive income is considered to be participation in network marketing. The amount of initial investment, if any, is not too large and rarely exceeds a hundred dollars.
A necessary condition for those who are trying to succeed in this field is communication skills, readiness to contact a large number people. In the future, these people - your team - are able to bring in money without your participation by organizing own network, the percentage of the income from which you will receive.
Do you need a lot of money?
The classic and, perhaps, best way was and remains to create your own business. If this action takes place in virtual reality, that is, on the Internet, global financial investments At the initial stage, as a rule, it is not required. That is, this option is available to people with very limited material resources.
Even earning money without investments is quite possible, or you can earn money by accumulating a small initial capital right here, on the Internet.
There are a huge variety of options for starting and promoting your own business, both online and in real reality. In "life", of course, this requires high costs and overcoming many organizational and legal difficulties. In addition, the competition here is very, very high. But still, by looking around carefully, you can spot your own niche, not yet occupied by your rivals.
What's in reality?
For example, very promising business with passive income in our time - the purchase and placement in large hypermarkets and other crowded places of machines for a wide variety of purposes - from payment terminals to units selling coffee and pies. Such a business is called vending. A person purchases at his own expense and installs machines, which then provide him with a constant and stable income.
In a short article, we do not have the opportunity to consider all types of passive income - there are very, very many of them. Variants of it are offered to us today by the media, and the Internet has been and remains their irreplaceable source. We want to conclude our material with important tips.
A few parting words
- At any cost, try to regularly find time left over from your main job, which you will spend on creating your future asset. Constantly think about how to best use it. Your goal is to ensure that earnings from your main job do not remain the only source of money for you. You must find sources of passive income that allow you to make a profit more than once or twice.
- Don't limit yourself to creating a single source like this. There can and should be several options for passive income, and the more, the better. After all, there is always a risk of losing one or most of them. In this case, losses will be compensated through parallel channels. You can see the importance of this postulate by reading about multiple sources of income from Robert Allen.
- Don't forget to educate yourself. Knowledge is an asset that will not hurt anyone. Understanding the world of finance, understanding how money is made, where it comes from and where it goes, is no less important than coming up with an interesting idea for investment or successfully being in the right place on time.
The principles of creating passive income do not contain any special secrets. If you are firmly committed to success, have the necessary minimum knowledge and some free time, the result is likely to please you sooner or later.
Since the publication of the works Tim Ferriss And Roberta Kiyosaki such a concept as " passive income"has turned into some kind of mystical thing that gives the opportunity to start a rich and free life for everyone who can get it.
It's no wonder that many are tempted to get their hands on this Holy Grail. But before you start taking action, it’s better to take a closer look at what passive income is and how it works.
What is passive income and earnings
In simple terms, passive income is creating something ( material or intellectual value), which will allow you to receive money for an indefinite period without further human intervention.
How to create passive income?
The simplest examples of passive income are book authors. They can spend several months writing a novel and then get paid for decades for every copy of that book sold. They create value, which then works for them.
However, this was too narrow a definition.
According to a reputable publication Investopedia Passive income is "earnings a person receives from a rental property, limited partnership, or other business venture in which he is not actively involved."
True passive income is income that does not depend on the mandatory performance of any regular actions and comes in even if its owner does nothing at all.
Popular culture in Russia defines passive income in rubles as “ any money you can make lying on the beach and sipping a cold mojito», but this is a misconception.
For example, a well-known financial trainer and expert in the USA Todd Tresidder notes that today passive income can be considered any income that requires minimal effort after the initial investment of time or money, and works in accordance with with Pareto's Law - « 20% of efforts give 80% of results».
Before you think about how to create passive income, you need to understand about active income.
What is active income?
Active income is the reward a person receives for the work he does. Regardless of profession, if a person spends his time and effort in exchange for money, this is active income. Earning options may vary ( lawyer, doctor, bartender, loader, copywriter, correspondent for print or online publications) but the principle remains unchanged.
- Principle active income: worked - ate.
- The principle of passive income: work - eat today, tomorrow, the day after tomorrow...
The main essence of creating passive income is to invest heavily or work at a certain point, and then, without making any effort special effort reap the rewards of your labor in the long run. Since there are so many different options for passive income, it’s worth talking about each of them separately, highlighting several of the most common and accessible to everyone.
Types and sources of passive income
Today there are a variety of ideas, examples and options for sources of passive income. However, it is immediately important to recognize the fact that this will not be so easy. Otherwise most hired workers, forced to work “from bell to bell,” would have long ago gone to free bread. For those who are still determined, it makes sense to pay attention to such sources of passive income as:
- bank deposits;
- valuable property and real estate;
- securities;
- participation in mutual investment funds;
- creation of intellectual property;
- creation and optimization of your own business.
Each of these areas and ideas has its own methods of passive income. And by choosing the path that is closest to oneself, everyone can familiarize themselves with them in detail.
IMPORTANT! The biggest and easiest money is earned from a person’s desire not to work, so on the Internet you can find thousands of offers from scammers, so when creating passive income, focus on its legality, adequacy, reliability and simplicity, where it will not be possible to deceive you.
Shares as a source of passive income on the Internet
For example, if you start from $3000 and report $300 monthly at 50% per annum, then in 11 years you will already have $1 000 000 !
You invest $3,600 a year for 10 years and get a million dollars out.
1 year $8,565
2nd year $17,362
3rd year $30,558
4 year $50,351
5 year $80,042
6 year $124,577
Year 7 $191,381
Year 8 $291,586
Year 9 $441,893
10 year $667,355
11 year $1,001,032
Look at the graph of this option for passive income on the Internet for clarity:
A stock portfolio is an excellent option for passive income, it is understandable and adequate, and will be an interesting way for most.
Here you can find hundreds of European and American stocks, commodity futures, energy and other assets.
One way or another, stock prices are rising all the time, and companies that more and more people are learning about are growing hundreds of times.
Over the past 3 years, only one has grown by 300% . This is the most advanced and legal passive income on the Internet.
Valuable property and real estate
This type of passive income includes:
- real estate;
- precious metals and stones;
- antiques;
- objects of art;
- collectibles (coins, stamps, books, vinyl records, etc.).
But you need to understand that to develop such a business you need to have not only starting capital, but also the necessary knowledge. So you will have to find experts and initially involve them in the cause.
How much can you earn this way? Depending on the chosen direction and market conditions, profitability can be from 15 to 70%. It looks good, but you need to keep in mind that investing in real estate, precious metals, as well as luxury items and collectibles is not passive income in the classical sense. Yes it can match Pareto's law, but nevertheless, a person is required to:
- careful study of current market analytics;
- ability to select liquid assets;
- careful monitoring of tax affairs;
- ability to find and attract clients.
There is one more point - it is advisable to invest for a long time. Real “exhaust” can only be obtained in 5–10 years. During this time, an apartment purchased in a new building may become more expensive by 30–40%, and various antique values and even more. This type passive income basically does not require anything from you - you buy and hold, and after n amount of time you sell.
For example, Andy Warhol's painting "Lemon Marilyn" was purchased by an investor in 1962 for $250. After 45 years, it was sold for $28 million.
Earnings on PAMM investing
For those who are not well versed in stock trading, investment solutions from offering such features as automatic copying of transactions of successful traders or can be an excellent option.
The bottom line is to invest money in managers on the currency exchange. Traders will take a small percentage of the profits, but will also make money for you. Thus it benefits everyone.
To make it easier for users to choose the most suitable option, all brokers provide a rating of the profitability of managers, where you can clearly see their successes both in the short and long term.
The return on investment in traders largely depends on the professionalism and market situation and may fluctuate from 30 to 150% per annum, and you don’t have to do anything yourself.
Creation of intellectual property
The softest for those who want to create passive income from scratch.
People with valuable knowledge, experience or good abilities to creativity, passive income without investments can be obtained thanks to
- audio creation,
- video,
- graphics,
- text materials of artistic or scientific content.
There are a great many ideas that can be implemented in this regard:
- writing books
- scenarios
- music
- software
with subsequent receipt of both royalties for the work itself and royalties, which will be paid whenever others want to use your work.
And although not everyone can earn large sums of money here, the availability of methods makes this direction very attractive.
Bank deposits
The most popular and simplest passive income in rubles is opening a bank deposit.
That is, in principle, you can put money in a bank and live on interest alone. The main advantages of this option:
- extreme simplicity of the process;
- you don’t have to do anything at all (just come to the bank, sign an agreement and give the money to the cashier);
- relatively low risks of losses.
However, there are also negative aspects. The first is more than modest profitability. The average rate of large banks is no more than 7–8% per annum. Less renowned institutions offer 8–11% in rubles or 2-3% in dollars.
In order to earn at least $1000 per month with a bet of 2% per annum, you must already have 600 thousand dollars, which will always lie on the deposit as “dead weight”.
Creating and optimizing your own business
Any business is painstaking and hard work. But only for the time being. According to an American financier Tim Ferriss, the success of any business is determined by its impact.
- Its first phase involves substantial cash injections and constant control by the owner. It takes about 4–5 years. In some cases up to 10 years.
- After this, the business evolves into the second phase and comes into compliance with the already mentioned Pareto Law - it provides its owner with 80% of the result with 20% of the effort. On at this stage there are no longer any problems with how to create passive income based on it.
The business owner can shift the lion's share of worries to the management staff, while he concentrates on things that are interesting to him or another promising business.
How to earn passive income in Russia
Organizing the creation of passive income in the Russian Federation is not much more difficult than in any other country in the world. However, there are also some nuances. Russia, for example, cannot be called “ a safe haven", so investing in stocks Russian companies in the long term, they require particularly careful calculations and a willingness to quickly look for new solutions. However, nothing prevents you from buying shares of foreign companies through or.
The real estate market here is also characterized by its heterogeneity. For example, if by 70% territory of the Russian Federation, real estate prices behave predictably and in accordance with global forecasts in such regions as MSK or St. Petersburg It is sometimes very difficult to predict price movements. During a period of general boom, relative calm can reign here, and vice versa, when there is crisis and stagnation everywhere, the volume of real estate transactions in Moscow, for example, can go off scale.
As a conclusion
As you can see, passive income is real, however, it is not always passive 100%
, as some not very honest authors of various trainings and educational materials like to say.
However, in any version of passive income, it will not have a boss in front of you, a work schedule, and in the case of passive income on the Internet such as shares or trust management, no territorial reference.
At first you will need to do a lot ( initially unpaid) work to get into profit and get a stable flow of money.
Passive income has many advantages, but, as elsewhere, there are also compromises. Initially, it is difficult to get a big return from it, so you will have to put up with the need to go to regular work, and maybe even more than one, to raise money for the start. And only those who are ready to mobilize efforts and forget what laziness is can succeed here.
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A variety of ways to earn passive income are thriving on the Internet. What is the most popular?
Income from a website or blog
You need to choose a profitable project: carefully study its activities, collect as much information as possible about it, and evaluate the prospects of the resource. If you are interested in a project, you invest your own money in its development and subsequently receive a profit from the investment. You can also sell your share at a higher price.
The entry threshold is quite low: sometimes a few tens of dollars are enough. However, there is always a risk - the project may turn out to be unviable, and its owner may be dishonest.
Lending via Webmoney
Webmoney allows you to provide cash loans to system users. The lender and borrower agree on all terms. The lender sets the loan rate and repayment period. The borrower receives the money. The agreed interest is credited to the lender's account from the borrower's account every month.
The system acts as a third party in the relationship between the debtor and the investor and does not bear any responsibility for repaying the loan, so there is a risk of losing your money. But the minimum loan amount is only $10.
But engaging in usury is not very good karmically, so I do not recommend this method.
Creating your own services
Services mailing lists, study services foreign languages, exchanges for website promotion, systems for analyzing websites or content - this list goes on and on. Each of these projects provides clients with both free and paid services, which means they are a reliable source of income for their owners.
The main difficulty awaits entrepreneurs at the start. To create a competitive project, you need to have serious knowledge of programming or have the finances to hire specialists.
It is also worth considering that in this case, this will not be passive income, because... you will need to constantly keep your finger on the pulse.
Infobusiness
Information business is a classic example of passive income. One day you release a video course, a book, or even an entire program from teaching aids and video lessons and sell its replicated copies automatically. You can also implement your own affiliate program and share a small part of the income for attracted clients.
However, there are some difficulties here too. If you teach people website development or web design, then you understand that programs and Internet platforms are constantly updated, some working methods become outdated, and new approaches to work appear. You need to update your courses from time to time.
PAMM accounts in the Forex market
Currency trading on the Forex market is a profitable but risky activity. It is not at all necessary to go on a risky voyage without experience and knowledge. You can transfer your money to an experienced trader and receive interest as an investor.
The technology is simple:
- register with a broker;
- create and top up your account;
- go to the “PAMM” section;
- select a trader;
- confirm that you accept his offer by clicking the “Accept” button;
- After the trader’s account appears in the list of PAMMs, click the “Top up account” button.
You can withdraw money after the trading period of a given trader has expired. The trading period for some may last a week, for others – 3 weeks, depending on the strategy. An application for withdrawal of funds must be submitted in advance.
Mutual funds and shares
A common way of investing is stocks and mutual funds. You can choose and buy shares yourself. By turning to mutual funds, you entrust your money to other people to manage.
UIF - investment fund. In such a financial organization, an investment portfolio is formed from several financial instruments: shares, bonds, bank deposits. You can buy a share in this portfolio. After the agreed period, your account will earn interest on the money invested. The larger the size of your share, the more money you will receive. Some risk of losing money this method investing is also present. There is no universal recipe for success, so it is better to divide your savings into parts and invest money in different organizations.
Where should you not invest?
You should not consider financial pyramids, casinos, dubious and illegal projects. All of these are obviously losing enterprises. Read reviews of sites and companies on third-party resources before you spend your money on someone.
Also, many are looking for passive income without investments, but this is impossible by definition. "Passive" can be obtained through investments, watch the mat part of the video from Kiyosaki:
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