Whenever someone needs additional income, the stereotypical suggestion offered is to "get a part-time job."
But what if you don't have the time or energy to put in all those extra hours?
I know I didn't. Plus that wasn't as appealing as making money while I was trading time for money.
For that, you may need some passive income ideas — ways to make money with little investment of time and effort on your part.
Here's a list of quite a few passive income ideas, so it's likely that you'll be able to find at least two or three that will work in your situation.
1. Try out index funds.
Index funds provide you with a way to invest in the stock market that is completely passive. For example, if you invest money in an index fund that is based on the S&P 500 Index, you will be invested in the general market, without having to concern yourself with choosing investments, rebalancing your portfolio, or knowing when to sell or buy individual companies. All that will be handled by the fund which will base the fund portfolio on the makeup of the underlying index.
You are also free to choose a fund that is based on any index that you want. For example, there are index funds set up for just about every market sector there is — energy, precious metals, banking, emerging markets — you name it. All you have to do is decide that you want to participate, then contribute money and sit back and relax. Your stock portfolio will then be on automatic pilot.
2. Make YouTube videos.
This is a venture that is growing rapidly. You can create videos in just about any area that you like — music, tutorials, opinions, comedy, movie reviews — anything you want . . . then put them on YouTube. You can then attach Google AdSense to the videos, which will overlay your videos with automatic ads. When viewers click on those ads, you will earn money from AdSense.
The keys will be to create compelling videos, to promote those videos on social media websites, and to create enough of them that your income will be coming from multiple sources. There's a good bit of work that goes into creating videos, but once a video is done it can become a completely passive cash flow source for a very long time.
Don't think you can find success with YouTube? You sure can. Emily Eddington used her love for makeup and YouTube to quit her full-time job. She has received over 66 million views on YouTube. This former morning news anchor took her passion — makeup — and turned it into a phenomenal success.
3. Try affiliate marketing and make sales.
This is a passive income technique that is better suited to people who have blogs and active websites. You can sign up to promote certain products or services on your site, for which you will be paid either a flat fee or a percentage of the amount of the sale completed.
This isn't as hard to do as you might think, since there are thousands of companies in the world who want to sell their products in as many places as they can.
You can find affiliate offers either by contacting vendors directly, or on dedicated websites, such as ClickBank. It's always best if the product or service is one that you are either very interested in or is highly relevant to your website.
4. Put your photography to work on the web.
Do you like photography? If you do, you may be able to convert it into a passive income source. Photography websites such as Shutterstock and iStockphoto can provide you with platforms to sell your photos. They may offer either a percentage or a flat fee of each photo that is sold to a site client.
In this way, a single photo could represent a cash flow source since it can be sold again and again. You simply need to create your photo portfolio, put it on one or more photo platforms, and then the activity becomes completely passive. All the technicalities of the photo sales are handled through the web platform.
And yes, that's me in a stock photo you can purchase from iStockPhoto.com. My good is a photographer and has uploaded a few hundred photos to their platform and makes a good residual income from it.
5. Purchase high dividend stocks.
By building a portfolio of high dividend stocks, you can create regular passive income at an annual rate that is much higher than what you get on bank investments.
Just as important, since high dividend stocks are stocks, there is always the potential for capital appreciation.
In that way, you can earn passive income from two sources — dividends and capital gains.
You will need a brokerage account to purchase these stocks and complete the research needed.
6. Build an app.
Apps can be an incredibly lucrative income source. Think about how many people today have smartphones. Come on, it's just about everybody! People are downloading apps like crazy — and for good reason . . .
Apps make people's lives easier. Whether it's an app that helps people put together nice pictures for their blog or an app that keeps track of tasks, there are helpful apps out there for everyone.
You might be asking if there are so many apps out there, why would you want to attempt to create an app? Isn't there a lot of competition? Well, yes, but fresh, creative ideas can win. If you can come up with something unique, you can make quite a bit of money. Simple — yet unique — apps can be pretty passive.
Second, you can hire a developer to build your app based on your idea. This could end up being an expensive option, although it will probably yield a professional-looking app.
The end result is an app that has the potential to make you some relatively passive income. Don't downplay the idea to build an app — it's a good one!
7. Invest in real estate.
This probably falls more in the category of semi-passive income, since an investment in real estate is always at least a little bit of an active venture. Still, once you have a property that is established and fully rented, it's mostly a matter of managing the property and keeping it performing well.
Additionally, there are professional property managers who can manage your property for you, usually for around 10% of the monthly rent. This professional management can make the investment much more passive, but will take a bite out of your cash flow.
According to Brandon Turner, an active real estate investor and co-host on the popular BiggerPockets Podcast,
The key to success with rental properties is buying smart. Not every property is going to provide a good return or prove to be passive. Understanding how to analyze potential real estate opportunities is incredibly important. As the old adage goes — you make your money when you buy!
Another benefit of investing in rental properties is the loan pay down. If you obtain a loan to buy the property, each month your tenants are paying off part of the loan. Once the mortgage on the property has been paid off, your cash flow will increase dramatically, allowing your mediocre investment to skyrocket into a full-fledged retirement program.
It wouldn't take many paid-off properties to provide a pretty great, and mostly-passive, future for you and your family.