Passive Income Ideas: 35 Strategies to Boost Your Income This Year

How to passively make money

Shutterstock Making money while you sleep has a beautiful ring to it. Earning passive income provides the opportunity to do just that. What is passive income? Passive income is defined as income that requires minimal effort—or perhaps even zero how to passively make money earn. Passive income typically enables your money to work for you. The best illegal and quick earnings income takes the least effort.

But today, we will consider many popular passive income ideas that will earn you money, whether you want to pay off a how to passively make money loan, dig out of credit card debt, or put together a retirement plan.

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As long as it requires little passive activity, it could be a decent passive income stream. Those who achieve financial independence will tell you that passive income streams are the key to success.

Most income sources require you to put in a LOT of work. Do you want to make passive income? You will need to invest in an asset that produces passive income for you. If you already have an asset that you are not fully utilizing, that can serve as your investment. Stop letting your money stagnate in a bank account and lose its spending power. Some of these next passive income ideas will get you ready to how to passively make money in your future. Passive income means you want to start valuing your time and your money.

These are some of the easiest passive income ideas that you could implement. Alternative assets Alternative assets, or alternative investments, are much talked about these days.

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The volatility of the markets and extremely low-interest rates for the foreseeable future have many people looking for alternate options.

There are many types of alternative investments. Some of the more popular offerings are hedge funds, private equity, crowdfunded real estate investments, and commodities like wine or geeky collectibles. We recently discovered another unique alternative investment, usually only available to the wealthiest of the wealthy: luxury watches.

Why inform you about an investment with that kind of price tag? You can buy partial shares of an assortment of watches at that buy-in level. The best part of it is your investment is backed by luxury watches owned outright by Luxe Street.

What is Passive Income?

Pro: Alternative investments give you exposure to unique asset classes, different from everyday stocks, bonds, real estate, etc. Con: Alternative investing is a fledgling industry with developing regulations. However, many companies give you the ability to invest in commercial and residential real estate projects without actually doing the heavy lifting yourself.

One example is DiversyFund.

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Having aligned incentives is important in investing. Another detail that differentiates DiversyFund is how they invest. Rather than spread their expertise too thin, DiversyFund focuses its investments on lower-risk multifamily housing.

What Does Passive Income Mean?

They use technology to scour the country for properties that fit their specific criteria. What criteria?

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Specifically, DiversyFund looks for high occupancy and positive cash flow properties, but that needs some work. Instead, a typical DiversyFund property could just need an updated bathroom or kitchen, or maybe just a fresh coat of paint. The fact that DiversyFund does all of the work themselves means they have lower costs than their competitors. After the aforementioned minor renovations, the upgraded properties merit increased rents.

And that increases your cash flows and the value of the properties.

The golden rule of passive income – protect your time.

Holding periods for DiversyFund properties tend to be in the five-year range. Both DiversyFund and their passive investors—e.

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When incentives are aligned, you give yourself the best chance to win. Pro: DiversyFund does all the hard work for you, giving you exposure to residential real estate without requiring you to be a landlord. Lending Club allows passive investors to diversify their assets by investing in different types of loans.

Wait…in loans? Lending Club allows you to how to passively make money your money out to people and groups looking for funding.

28 Passive Income Ideas You Can Start Today [Make Money 24/7]

The type of loans you choose will determine your investment return and risk exposure remember, risk and return are related. Your investment is combined with other investors to make up the entire loan amount.

This diversification tends to decrease risk. So how do you generate income with Lending Club? As a borrower pays down their loan, you will receive monthly interest payments. Like all loans, Lending Club charges interest to the borrowers.

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That means that you collect the principal and the interest. Pro: Lending Club allows you to help many different loan seekers while earning passive income yourself. Con: If a few of your loaners cannot repay your loan, it can be easy to miss out on profits or potentially even lose money.

Invest in dividend stocks Dividends are profits paid out to owners of stocks. Some companies pay dividends regularly, which means that dividends can become a dependable source of income.

Investors who love dividend-paying stocks will talk about their investment is generating dividend income and appreciating.

Keep in mind that stocks with high dividends still carry risk.

But a dream without a plan is just a wish.

Dividend stocks can drop in value like any other stock. Historically, dividend-earning stocks drop in price less than the overall stock market.

They tend to be steadier in price—less upside, less downside.

In essence, you can do most of the work upfront and put some additional effort along the way to earn an income. For example, if you create an online course, you just need to update its content to keep the money flowing. Or you can own something property or stocks that allows you to earn passive income.

Some people even rely on dividend checks for their regular expenses. They receive thousands of dollars each quarter from their dividend investments. And that might require you to own a significant number of shares!

Passive Income Ideas: 35 Strategies to Boost Your Income In

But if you have some extra cash to invest and understand the risk involved, dividend stocks are something to consider. Perhaps an index fund full of them would be right for you.

Just make sure you learn about the risk or lack thereof from the index fund bubble. Saving money is always a good thing. Sadly, brick-and-mortar banks barely pay any money in interest.

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The best part is that as of this writing Octoberthey pay as much as 0. They consistently pay higher rates than almost any local or national brick-and-mortar banks. You could also look into money market accounts, treasury bonds, or certificates of deposit for low-risk, stable return investments.

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Pro: As safe as safe can be. Con: Meager returns. In fact, inflation might cause you to lose buying power. How to passively make money passive investing or financial planning ideas, make sure you understand the tax ramifications with the Internal Revenue Service IRS. Long-term index fund investing Do you believe that the global economy will continue to grow and progress?

If so, index investing might be for you.

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An index fund is a mutual fund that owns a wide assortment of assets. Some index funds are fairly focused e.

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Other index funds are broad e. Either way, the idea of index funds is that they lower risk by diversifying their assetsand they lower their costs by enacting simple asset ownership rules. They just buy the whole haystack.

  • Get the Course Learn More Finding Passive Income Ideas with This List Each suggestion is ranked by how much effort you need to put in upfront before you might start seeing some money come in.
  • 30 Passive Income Ideas You Can Use to Build Real Wealth

Over the long run, index investing has proven to be a very successful method of portfolio growth. And if your portfolio is growing, you can skim off some of the profits as passive income. Pro: Proven method of long-term monetary growth and successful retirement planning.

Con: Not a short-term passive income solution. Could you imagine buying into companies like Shopify or Uber when they only had a handful of employees? Small angel investment can grow by x! Of course, that same investment can just as easily disappear within 6 months to a year.

Angel investing is a feast-or-famine proposition. Pro: Immense upside. A hands-off way to help entrepreneurs trying to how to passively make money the world. Con: As high risk as anything mentioned in this article. These take a bit more effort to execute, but they can still build long-term wealth. Put Your Real Estate to Work Utilizing your real estate is a great way to turn your property into rental income. Use what you already own! Use Airbnb or similar services Rewind 20 years ago.

Airbnb and similar services have revolutionized where we stay when we travel. And it has opened up serious passive income doors for you and me. Unsure how much money you can make? Simply log on to Airbnb and check out what your market looks like. There are sure to be other Airbnb hosts in your neighborhood.

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What are they charging for a room or their whole house? But you still have to act as part landlord, part maid, and maybe even cook your guest some meals. But if you how to passively make money excited by the idea of meeting new people and making some solid side cash, then Airbnb hosting might be perfect for you!

Pro: Meet new people every week while getting paid to do so. Con: You have to become part landlord, part cook, part maid, etc. Consider renting it out for extra income. There are some pros and cons to compare. The most obvious trade-off is a few hundred bucks in monthly rent compared to the inconvenience of having a guest in your home. Just make sure you both sign a formal rental agreement so that everyone is on the same page. Pro: Turn an unused resource in your home into an income source.

What Is Passive Income?

Con: Another person is living in your house…your kitchen…your bathroom. But how about hosting someone on your property by renting your extra land? There is a tiny home bonanza sweeping the country right now.

People are choosing to live in tiny homes and embrace a minimalist lifestyle. For a lot of those people, the only downside is where to place their tiny house.

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If you have some land, this creates an opportunity for you to rent out space on your lot. Real estate income and rental properties are often considered passive, or at least partially passive. Either way, they are trendy methods to build long-term wealth.

Pro: Compared to other ways, you can share your real estate, this is pretty hands-off.