Creating several passive income streams is a dream for many entrepreneurs. It can accelerate plans to make extra income, pay off debt, and invest in building wealth. But what exactly is passive income? Are these streams truly passive? What can we do to begin tapping into this hidden stream of profits? Read on to find out how you can start producing passive income today.
What Is Passive Income?
Who doesn’t want an extra source of income or some extra cash to splurge here and there? Well, passive income is the best income stream that you can have. It’s cash flow without considerable effort.
Truly Passive: Purchase and Forget It
Passive income that is always passive is usually found in the form of investments. With this type of income, you make a purchase and forget it. Therefore, you don’t have to devote time or energy to generate money from these passive income streams.
Income From Stocks
There are two main ways to make money from stocks. First, you can start investing. Purchase and forget it. Then make money when you sell the stock down the road through capital gains. That isn’t a continuous form of income, but it can come in handy when you’re ready to retire.
A Bond Ladder
A bond ladder is a portfolio of multiple bonds that mature at different times. When the bonds mature, you can reinvest the returned principal in new bonds and start a new ladder or continue adding on to your current one.
Income From Interest
You can earn passive income with interest when you loan money to someone else. For example, you can loan banks money in the form of a high yield savings account, and you can lend businesses money in the form of bonds. But you also earn interest when you loan money to peers.
REITs
Rental properties are expensive and time-consuming. If you love real estate but don’t feel like putting in the work or money to flip or manage properties, check out real estate investment trusts (REITs). Real estate investing with REITs is like buying and selling stocks on major stock exchanges.
Invest In Crowdfunded Real Estate
Invest in real estate without buying property through crowdfunding real estate platforms. These platforms connect investors to real estate investment properties.
Rent Your Parking Space
There’s nothing like owning a piece of asphalt that can make you some easy money. Renting out your parking space in crowded cities where parking is precious can earn you a few hundred extra dollars a month. Of course, location matters, but size can also be important.
Requires Upfront Work, Then Becomes Passive
– Income From Royalties
– Income From Publishing
– Income From Patents
– Income From Affiliate Sales
– Create An App
– Advertise On Your Car
It’s essential to have different streams of income. So, if you genuinely want to generate passive income, look for ways to make money without big-time commitments and work. Building a steady income stream may take a little time, but it’s worth it.