If you don’t know what passive income is or why you should pursue it immediately, check out this post.
For those who have read that post and are ready to dive in but don’t know where to start, this article is for you!
Here are 5 sources of passive income that can totally transform your life if you hustle and pursue them with everything you’ve got.
1. Stock content
If you have a specialized skill-set, chances are you can make stock content.
Maybe you’ve got an eye for photography, graphic design, or painting, or you can code widgets.
Any of these skills (and more) can translate into creating stock content that can make money forever.
You can make products that earn money forever, which is passive income at it’s finest.
Don’t believe me?
Consider Pablo Picasso, the world-famous 20th century artist whose prints still sell online today long after he passed away.
Picasso made classic art that will make money till the end of time.
Though you may not be the next world-famous artist, you can still earn passive income creating stock content.
Veteran photographer Joe Sohm has licensed everything from American flag pictures to U.S. president pictures and has made over $10 million throughout his 30-year career.
Christian Budschedl was the first seller on ThemeForest, a WordPress theme marketplace, to cross a whopping $2 million in sales.
Here is a list of stock content web marketplaces where you can start earning passive income from a variety of skills:
- photography on istockphoto.com
- video on shutterstock.com
- music on audiojungle.net
- sound effects on audiomicro.com
- animation on videohive.net
- vectors and illustrations on vectorstock.com
- 3D Models on pond5.com
- art on fineartamerica.com
Affiliate income is one of the best ways to earn passive income online.
What exactly is affiliate income?
You earn affiliate income or a commission on the sale of someone else’s product when someone clicks on your custom link to a product and makes a purchase on that site within a certain time-frame.
For example, if you click on my affiliate link to my e-books, Amazon stores a cookie indicating my link lead you to their site.
If you make a purchase (of anything) from Amazon within a month after you click my link, Amazon gives me a commission on that sale.
Affiliate income is an unbelievably successful monetization strategy used by most successful internet entrepreneurs.
Here’s what Jon Morrow, an incredibly successful professional blogger, has to say about it:
Personally, I think the advantages are so enormous that no beginning blogger should consider any other business model.
Morrow’s endorsement makes sense when you consider that both Michelle Schroeder-Gardner and Pat Flynn make more per month than most people make per year from their Bluehost affiliate recommendation.
This is one of the reasons I recommend Bluehost.*
Not only do I think it’s an exceptional product and the one I use to host this blog, it’s also generous with its affiliates.
Passive income success from affiliate recommendations essentially boils down to establishing trust with an audience.
You do this by producing exceptional content for free.
It’s certainly not easy but, as I’ve written before, passive income like this is worth pursuing.
3. Information products
Affiliate income is a great way to monetize at the beginning of your entrepreneurial journey.
But if you really want to maximize your income, creating your own information product is the way to do it.
Information products scale perfectly with little to no marginal cost as sales increase.
In other words, they are the perfect passive income earner.
Between 2005 and 2011, Mike Geary sold over 500,000 copies of his fitness information product priced at $47.
In 2015, Greg O’Gallagher was selling 100 fitness information products on his website per day for between $30 and $50 a sale.
And Tracy Raftl makes $80,000+ a year selling information products on her adult acne blog.
These bloggers and their success show that information products are a stellar source of passive income.
4. Real estate
Real estate investing is a tried-and-true strategy if you go about it with a passive income focus.
How do you do that?
The best way is to purchase rental properties and hire a property management company to manage them.
The property management company will take a cut of the rental income in exchange for marketing the property, acquiring the tenants, handling the rental payment, and dealing with repairs.
In other words, all you need to do is own the property, then hand it off to a property management company to deal with the rest.
There are countless stories of people making an incredible amount of passive income renting properties.
If you’d like to learn more about how you can leverage this opportunity, biggerpockets.com is also great resource.
Earning passive income with real estate is more risky than the above-mentioned methods because it typically requires significant capital investment and/or a mortgage loan.
But you can minimize this risk and try your hand at renting a spare room in your current living situation through airbnb.com
The key is to start small, minimize risk, and test the waters to see if this passive income earner is right for you.
5. Stock investing
Investing in the stock market is another classic way to earn passive income.
But keep in mind that it’s best to think of the stock market as a place to preserve and increase wealth, not generate cash flow.
Some people try to generate cash flow in the stock market by day trading.
But there are almost no successful day traders that started with very little money and managed to turn that into serious wealth.
The only exception I’ve heard of is Tim Sykes.
(His book, an “American Hedge Fund,” is a fascinating read if you’d like to learn more about his story.)
Though there are hardly any successful day traders, there are countless people that build wealth in the stock market.
Don’t know a thing about the stock market?
You can still earn a better return than the “best” players in the stock market by investing in an index fund.
Warren Buffett, the greatest investor of all time, recommends index funds to anyone and everyone looking to earn a solid return.
Investing in index funds is how Peter Adeney of mrmoneymustache.com was able to retire by age 30.
Regardless of how you earn passive income, I highly recommend also investing in the stock market.
If you aren’t interested in researching stocks just get started investing in an index fund.
I’m set up to earn affiliate income through this blog and I already sell information products like these.*
I also have high hopes of becoming a passive income real estate investor in the future.
And every year I invest at least $5500 in the stock market.
In other words, I’m pursuing or plan to pursue all of these sources of passive income with the exception of stock content.
I think stock content is a fantastic passive income opportunity if you have the skills and the passion for it.
But I don’t have either.
However, I do have the passion and skills for blogging which is one of the many reasons I recommend Bluehost web hosting.*
It’s inexpensive (use my link to get 50% off the standard price and get started for just $3.95 a month)!
It’s easy to use (you can install WordPress with one click).
And it’s what the pros use (including Pat Flynn, Michelle Schroeder-Gardner, and John Lee Dumas).
So start your passive income journey today with a blog and Bluehost web hosting!*