34 How to generate passive income now
What’s up everybody and welcome to the Financially Free Journey podcast where I aim to dispel the seemingly complex topic of personal finances, money management, debt, savings, investing and even retirement. This podcast is designed to help you feel empowered by increasing your knowledge so you can flex your money muscles!
Thanks for tuning into another episode of the podcast and wow, what a week it has been for the show. I mentioned a few episodes ago that I was working on producing more content for all of you and getting more episodes out for you as you all have requested. This past couple weeks I have been putting out triple the amount of episodes I normally do and trying to answer all of your questions that have been sent to me through social media and the shows email which is firstname.lastname@example.org
I really try to answer as many emails and messages as I can so if I haven’t messaged you back yet, I am working on it! Also, the show has officially been streamed in all 50 states and in over 60 countries worldwide. So shout out to my top listening states California, florida, new York and Texas! And outside of the united states we have a lot of listeners tuning in from Ireland, Canada, Australia and the united kingdom! So thank you everyone for the support and welcome!
Ok, today’s episode is a highly popular topic and a question that gets asked a lot, how can I generate passive income, like NOW!
Let’s first talk about WHAT passive income is exactly.
Passive income is income that you get on a regular basis with little to no effort.
The traditional income source that we are all used to is our income source that we are actively engaged in every single day. We go to work and in exchange for our time we are paid a certain amount of money.
What if you could be freed from having your income tied directly to your time? I think this is something that almost everyone strives to achieve. You can have that time freedom and not be worried about being able to pay your bills every month.
In todays episode I am going to talk about some passive income ideas and how you can get started ASAP!
Now, I first want to say, I know that the definition of passive income is income you get with little to no effort….but you have to remember that is the LONG TERM GOAL! Passive income has to be generated through hard work and establishing a foundation so that income can generate long term. Setting that foundation and establishing a system does take time and effort so this is anything but a get rich quick scheme!
Passive income can be a great supplemental source of income to help you with Christmas and Birthday’s or you can strive for your passive income sources to be your main source of income so you can quick your job. Regardless of what your goal is and why you are tuning into this episode, these principles and passive income sources can help you get to that goal!
Ok so here it is, let’s talk specific passive income sources that you can start now!
#1: Selling information products
OPPORTUNITY: Ok, let’s talk information products. One very popular strategy for generating passive income is establishing and selling an information product which are things like e-books, courses, audio books, etc. You can create a course and sell it through websites like Udemy or skillshare.
I personally love this passive income idea because first of all, you get to be creative, share your particular skill set with the world and all while you are able to generate additional income by doing so.
For example, as a lot of you may know, I created a personal finance course called the Budgeting Basic’s Course at achieveyourmoneygoals.com
This course was my way of being able to help my listeners take their personal finances to the next level by going through the course and taking action on the principles I teach and recourses I give each student.
This is something EVERY SINGLE one of you can do. If you are listening to this podcast you also have the ability of creating a course and selling it. Everyone has a skill set or knowledge that you can share with other people and you may not even realize that you can generate income off of your knowledge.
I read about a women that sold a course on how to bake the worlds best cinnamon rolls and has generated over $100,000 a year in passive income from her course. No matter how big or small you think what you have to offer is, other people want and need that information and you can provide them with it!
RISK: In order to be successful, you have to put a lot of time into creating a great product upfront. This process is not for the faint of heart, I can tell you personally. You have to have a great product and plan on creating additional courses as well that you can provide to your students in order to grow your business.
#2: Rental income
The second passive income source that I want to talk about is probably the most popular and generally what comes to mind when you think about passive income which is rental income.
OPPORTUNITY: We know that this is an effective way to earn a passive income and amass wealth. Now this is an interesting statistic…over the last 2 centuries over 90% of the worlds millionaire’s have been created by investing in real estate. That is a statistic I’m interested in!
In order to be successful with investing in real estate, you need to pinpoint your investment strategy and really understand that market. For example, are you going to be a residential landlord? Are you going to buy up commercial property and rent to businesses? Pin point what you want to do and understand that strategy prior to jumping into the market.
This passive income source will actually have its own episode in the near future because there is honestly so much that goes into this. But here are some basics to think about:
How much of a return do you want on your investment?
How much does the property cost as well as maintence and expenses?
Understand what the financial risks are of owning that particular property
Take the time to figure out the numbers and go from there. For example, lets say you want to make $20,000 a year in rental income. You have a property with a mortgage of $1,000/month and additional taxes/fee’s of $200/month which means you would have to charge $2,875/month of rent in order to make $20,000 a year on that property. Now look at the market research- are there comps in the area where renters are paying $2,875/month for similar properties? If so, you may have a winner.
#3: Affiliate Marketing
Now this may be a great strategy for you if you have a good online presence like social media, blogging, youtube, etc.
With affiliate marketing, website owners or “influencers” on social media promote a 3rd party company, website or product by providing a link for their followers. Once the followers click on the individuals provided link and they purchase, the affiliate marketer makes a commission from that 3rd party business they are promoting.
Amazon is probably the most well-known affiliate marketer and it seems like every influencer through Instagram is sharing their affiliate links with their followers on a daily basis.
Great think about this is that this is a very easy passive income to get started without any investment or capital from you. This is considered passive income because in theory you can generate income from your readers or followers just by having them click a link but the truth is that you have to actively post or talk about the product to get people interested in clicking on the link.
#4: Dividend stocks