Generating passive income streams is a smart way to boost your financial security. It gives you more breathing room in your budget. It usually takes some upfront work to make money passively. However, the extra cash flow can provide immense benefits over time by supplementing your regular income.
Passive income is money you earn without having to actively trade your time and labour for it on an ongoing basis. It continues coming in whether you work or not that month.
Passive income streams, once established, can grow with relatively little maintenance. This frees up your time to pursue other goals while you make money in the background. Passive income provides greater financial resilience. It helps you cover expenses without relying solely on traditional employment income.
Keep reading for some great ways to try to make money consistently without serious ongoing effort.
In this section, we’ve outlined five passive income ideas, starting with the most accessible.
1. Savings accounts
GREAT FOR: People who have a healthy bank balance or a decent amount of disposable income.
Interest rates have been low in recent years. But opening a high-yield savings account, cash ISA, or stocks and shares ISA is still a great idea. This will generate passive income earnings from the interest on your cash reserves. Though rates may be modest, it's income you earn with no active effort required.
TIPS:
- Find the best savings interest rates at Money Saving Expert.
- Set up a standing order from your current account to add to your savings pot each month.
- Be aware that rates can fluctuate over time.
2. Affiliate marketing
GREAT FOR: Digitally-savvy people with a strong online network.
With affiliate marketing, you can make money by promoting other company's products or services. Places you can share affiliate links include:
- On your website or blog
- In an email newsletter
- On a YouTube channel
- On social media platforms
Building an audience and creating content takes upfront work. But affiliate income can continue rolling in long-term. Check out
Shopify’s guide to affiliate marketing for beginners.
TIPS:
- Choose products related to your expertise and interests, that you can authentically recommend.
- Disclose affiliate relationships transparently.
AFFILIATE PROGRAMMES TO EXPLORE:
- Amazon Associates (great if you have a website or email newsletter)
- Metapic (great for social media influencers)
- Webgains (great if you want to learn more about publishing content online)
3. Self-published products
GREAT FOR: People with skills in writing, art, photography, videography, and other creative pursuits.
Self-publishing books, digital courses, music, images and more can generate ongoing passive income. If this sounds like an interesting way to make money, below you can see some popular self-publishing platforms.
PLATFORMS TO EXPLORE:
- Kindle Direct Publishing (self-publish print and digital books and reach millions of readers around the world on Amazon)
- Unsplash+ (apply to be an Unsplash+ contributor and get paid for your images)
- Udemy (create an online course and publish it on one of the largest online learning platforms)
- Gumroad (sell pretty much anything from music to comics to ASMR recordings)
TIPS:
- Research upfront what content is in demand.
- Optimise products for searchable keywords.
- Promote aggressively when you launch.
4. Online businesses
GREAT FOR: People with marketing skills and some capital to invest in setting up a business.
Creating an online business like an e-commerce store or mobile app can produce passive income once established. The key is building or acquiring online properties that can generate revenue in a largely automated fashion after launch.
EXAMPLES:
- Print-on-demand T-shirt business
- Pet supplies dropshipping store
- Niche interest app
TIPS:
- Identify niches with demand.
- Reinvest revenues to add new income streams.
- Automate as much as you can, and consider outsourcing whatever’s left.
IMPORTANT CONSIDERATIONS:
- Upfront costs of development/acquisition can be high.
- Success requires ongoing optimisation.
- Trends can shift.
5. Rental income
GREAT FOR: People with a spare room, holiday home, or the means to buy a property to let.
Rental income can be a lucrative way to make money long-term. But it's not an option for everyone. If you're in a position to become a landlord, be sure to thoroughly screen potential tenants. Also familiarise yourself with landlord-tenant laws, and have a lease agreement drawn up. Hiring an affordable property management company can make this extremely passive.
USEFUL RESOURCE:
The complete guide to preparing a property to let for first-time landlords
TIPS:
- Maximise rental income by focussing on amenities renters desire.
- Be prepared for periodic vacancies between tenants.
- Be prepared for unexpected repair/maintenance costs.
No matter which passive income ideas you pursue, it's wise to control your spending carefully. Using secure prepaid debit cards like a
paysafecard can help you avoid overspending or going into debt. Paysafecard is a prepaid card that lets you load a set amount of funds. You can't overspend beyond the card balance, making it easy to track your budget. With passive income providing a cushion, responsible money management maximises the benefits.
You can use passive income to build up savings, repay debt, or simply boost your lifestyle. If possible, establishing multiple passive income streams is a savvy long-term strategy.
Good luck on your journey to greater financial freedom!
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