Time is our most limited resource – yet it’s often the only way we can make a living.
Your day job requires you to exchange your time for money. But if you’re short on time and need a way to boost income for paying off debt, consider setting up one or more sources of passive income to leverage your time better.
What is passive income?
Passive income is produced by leveraging your assets, whether purchased or created. These assets are considered investments that produce residual income over the long-term.
It may take some time, effort, and money up front to get these assets to a place where they become a source of passive income. But when done right, the return on investment will be worth it.
Use these tips to start a passive income stream on the side of your regular job that will help you pay down student loans faster.
Best sources of passive income
1. Rent out a spare room
How much you earn depends on the size and location of your home; if you live in a popular city or close to attractions (like an airport), you could earn extra money from a space in your home that would otherwise remain unused.
If you’ve been considering becoming a landlord but aren’t ready to pull the trigger on such a large investment, consider using one of these sites to host travelers on a smaller scale. You could earn as much, or even more, than a traditional landlord since you can charge per night like a hotel.
2. Sell an ebook on Amazon
If you’re an expert on a particular subject, you could earn as much as $2,000 from selling ebooks via Amazon’s Kindle platform. This is what writer Steve Gillman did and has since earned thousands more from his ultralight backpacking ebook, as well as many other ebooks that he’s written and sold on Amazon.
The more specific your topic is, the better it will sell. It may take a bit of time and effort up front to write and format the ebook, but if it’sa topic you understand well, it will be relatively easy to write.
These kinds of shorter ebooks usually sell between $2.99-$9.99 each – Amazon pays a royalty of 70%. So at a price of $2.99, for example, you’ll walk away with a royalty of $2.09 per sale. Pretty cool! And the best part is that you don’t have to do much marketing to make continuous sales since Amazon does most of it for you.
3. Earn royalties from a fiction book
Much like writing an ebook, publishing a traditional book can reward you with well-earned royalties for as long as the book continues to sell. Fiction books can become especially popular, making your passive royalties quite substantial.
The most popular fiction book series have been turned into movies, screenplays, and even theme parks (The Wizarding World of Harry Potter, anyone?).
You can continue earning money as long as your book sells or is used as a jumping off point for other avenues.
4. Invest in land minerals
This passive income strategy is lesser-known since it requires a bit more legal research and consulting to ensure a fair deal. But once you purchase oil and gas minerals, it could be a very easy way to make substantial money. I used to work for several oil and gas companies for over 10 years in the Dallas, Texas area and continue to earn small oil and gas mineral royalties myself.
Oil and gas mineral rights are purchased from individuals or families who have inherited the property. There are multiple types of royalties you can earn, but they all produce an income stream percentage from the oil, gas, and other minerals sold from each well.
You could also earn bonus money from any land you lease to oil and gas companies who want to build these wells on your property. In this case, you would only own the surface rights to the land and not the minerals below.
5. Sell your photography
There’s a large market for stock photography for corporate websites and casual blogs alike. Additionally, social media is driven by imagery, so there’s a growing need for beautiful social media images as well.
There are several ways you earn passive income from your photography. You can start earning residual income from your photography by selling it online via:
- Stock photography websites like Shutterstock and ThinkStockPhoto will pay photographers a small percentage of sales you make on their platform. This income stream becomes completely passive once you upload your images to one or more of these stock photography sites.
- Creative imagery sites like Creative Market and Etsy are aimed at artists with a more modern perspective. So if you’re a photographer with a unique point of view, your images could consistently sell without any marketing.
- Start your own photo membership site aimed at social media experts and bloggers. Charge a small subscription fee for these individuals to access monthly photo packages. Some examples of excellent photo membership sites include Death to the Stock Photo and Rosemary Watson.
6. Become a referral source
If you have a well-established blog or social media following, you can review products and earn a small commission if people sign up through your link.
This form of commission-based referral income is also known as affiliate marketing. It’s a completely legitimate way of earning passive income on the side and there are multiple ways you can become a referral source.
Start by signing up for a particular brand or product’s affiliate program and then grab your personal referral link. You can then publish in-depth tutorials of services on your blog, unbox a product and publish the video on YouTube, or share your experience with friends and family members via Facebook or Instagram. Just be sure to include your special link so anyone you refer it to will be able to sign up and you’ll receive a commission.
7. Get paid to shop
Start earning money by getting paid to shop and earning rewards for things you already plan to buy. For example, InboxDollars rewards you with money for surfing the internet, taking surveys, watching ads, and testing out different products. Take advantage of earning points or cash for things you’re already doing.
You can also earn cash back on all your purchases with sites such as BeFrugal or Swagbucks, getting paid via PayPal or gift cards. I recently cashed in my BeFrugal earnings for a $75 Amazon gift card and used it to purchase some much-needed household supplies.
Setting up passive income streams requires some work in the beginning, but can be a lucrative way to earn additional income once you have the correct formula.
Just be sure to not let it consume too much of your time. Focus on the sources of passive income that cater to your strengths and you’ll start earning extra money towards your financial goals in no time.
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