We’re all about saving money, but it can get pretty exhausting to have a full-time job and more than one side hustle running all at the same time. To reach your financial goals this year and start making money with little effort, it’s time to check out this crazy thing called passive income. If you’re not sure how to do that, we’re here to help! Here are our top four ways to create passive income in 2019.
Before we start though, what is passive income?
Passive income, also known as residual income, consists of regular income from a source outside of an employer or contractor. It’s basically a steady cash flow that comes from a source you’re not managing or worrying about 24/7. Sounds amazing, right? While passive income is meant to be the last thing on your mind, it does take some work up front to get going so pay close attention.
If you’ve got a sizeable savings account and want to start making your money work for you, consider getting involved with rental properties. Buying and renting out property can be overwhelming, but the benefits you reap could be huge. If you are able to watch the property market closely and score a great deal on a home, you could easily rent it out and charge more than the monthly mortgage, which could throw an extra few thousand dollars into your hands by the end of the year. If getting a rental property is out of your financial means right now, consider renting out a room in your house. If you live near a university, college students are always looking for cheap places to live for a semester at a time. You can also put your extra room up on Airbnb and start raking in the cash. Rental income can come in many different forms, so be sure to evaluate your current financial situation and choose a path that’s best for you!
If you follow any sort of online influencer or blogger, you’ve probably seen or heard the phrase “affiliate marketing”. This neat trend is how most fashion and lifestyle bloggers make a full time income from just sharing products that they love. How does it work? All sorts of companies like Amazon and Target offer affiliate programs where you can apply to get access to special product links. When you share those links on your social media, blog, or any place online and someone decides to buy the product from clicking on your link, you make a small percentage of the profits. It doesn’t cost the customer anything extra, but the company is basically paying you for helping them land a sale -- like how some employees get commission. If you often find yourself posting about clothing, home goods, or any sort of product online, you may want to look into affiliate marketing and start earning some passive income.
Invest in Dividend-Paying Stocks
The oldest way of earning passive income is investing in stocks that pay quarterly dividends. If you’re new to stocks, Ally offers free courses to help you understand how investing works. Most financial advisors will suggest that you re-invest your dividends, but you always have the option to withdrawal your earnings and keep them. Larger companies tend to pay dividends to return a portion of their profits to the people who invest in their company.
Sell Digital Products
We’ve talked about creating a small business on the side to generate more income, but have you ever considering selling digital products? Etsy now gives you the option to sell physical and digital products. Obviously, physical products take more time to hand-make and ship out, but digital products give you more flexibility. For example, if you’re an experienced web designer, you could create 5-10 website template downloads that maybe take up a few days of your time, but end up selling for months or perhaps even years to come! For this reason, if you are a good writer, it might be wise to try out your hand as an author: E-books are becoming widely popular because of this i! By spending a little time up front on a digital product, you can reap long-term rewards without spending massive amounts of time on it.
Get CashBack Rewards on Credit Cards
An underrated form of passive income can actually occur every time you swipe your credit card. What is cashback? Every time you swipe a cashback credit card, you get a percentage or flat-tiered rate rebate back onto your card. You can then redeem this cash back by turning it into giftcards, sending it to your bank, or putting it towards your next credit card bill. If you have a credit card that qualifies for cashback, it's definitely something to consider and -- the rebate percentages are typically higher than the interest rate on your average bank account. In any case, it's a quick and effortless way to make a little dough whenever you spend a little dough.
There you have it. All of these tips will cost you a little bit of time and effort in the beginning, but the long-term rewards and income can be phenomenal. By investing your time in creating passive income now, you will be setting yourself up for financial success for many years to come.
What are some of your favorite passive income ideas? Do you have any we haven’t mentioned? Share them below in our comment section! We’d love to hear from you.