If you’ve been wondering what passive income is and how to get started then check out these seven easy ways towards a side hustle that works for you.
A lot of people think you need to have money to make money and, while that certainly helps, there is nothing stopping you from generating a healthy passive income that can supplement your day job or even replace it altogether.
So what is passive income? At its core, it’s doing something now which can then passively make you money in the background while you sleep — literally. Compare this to active income where you exchange your time and labour for money and then the transaction is over.
For passive income to work, you may have to invest as little as ten minutes, or as much as a year, of what feels like unpaid work. Eventually, however, you will have that work repaid over and over again for months or years, creating a stable passive income stream. Here are some of your favourite passive income options – see which ones are right for you.
What is Passive Income and How to Get Started
In short, passive income means that you build something in the short term that can continue to make you money in the long term, without you having to do a thing. You can focus on other work, or just relax, and your passive income is making you money in the background.
A passive income stream can help you save for the future, invest, or simply treat yourself on a more regular basis than you ever could on a regular salary.
Having a 9-5 job doesn’t offer the security it used to; being a freelancer can often feel stressful with the unpredictability of your income from one month to the next. Having one, or multiple, passive income streams can protect you from a sudden change in job circumstance or cover you during a quiet month of freelancing.
1) Affiliate Marketing and Referrals
Affiliate marketing really is one of the easiest ways to make money and it can include such things as placing a link in a social media post, your bio, or in the description box of a Youtube video, or as part of a larger piece of writing where the links are are embedded within an article.
Early bloggers would literally rake in money from affiliate links, setting up quick sites that were geared to making affiliate sales and having no need to disclose their efforts. With the internet becoming more transparent, it’s now essential that you disclose that you are including affiliate links.
This is as simple as making people aware that you’re profiting off their click. You may think that this will turn people off but, more often than not, readers prefer the transparency or don’t care either way. Naturally, as more people know about it now, more people are doing it.
That hasn’t caused it to be saturated in any way, though. More people are shopping and buying online than ever before and you’re simply connecting a buyer with a product.
Affiliate marketing is an amazing way to make money on a brand new site long before you’ll qualify for ad revenue. It just takes one quality post, geared towards the target reader, to make enough money to support the costs of running your website. This means no loss from essential costs like hosting and domain fees. You’ll find affiliate links in this article and many others on this site.
This is also a great idea if you’re running a newsletter, recommending things to your readers that you would have anyway can help offset the cost of running the newsletter and more.
Read More: If you’re interested in mastering advanced affiliate marketing or you’re wondering why you’re not making money then check out Ten Steps to Mastering Advanced Affiliate Marketing
Some of the Best Affiliate Marketing Partners:
If you want to set up a social media page or blog around a certain topic then there will definitely be specific affiliate programs suited to your niche. Here are some of the most popular affiliate programs that anyone can get started with. Take some time to research which ones will work for you in terms of what you and your audience are interested in.
If you have a website you can use platforms that introduce you to multiple affiliate partners such as:
On these websites, you’ll be able to join a number of affiliate programs with all of the money being pooled into one pot which you can withdraw.
We primarily use Awin and have joined affiliate programs such as Etsy, Booking.com, Waterstones, Audible, and a number of fashion and clothing websites through them.
These programs allow you to refer a friend for money or credit towards their product which is useful if you spend on that site regularly. These are just a few popular ones, you can type in ‘referral scheme’ into google and a keyword and plenty will come up.
Fiverr – A service that matches freelancers with clients which allows you to earn up to $100 each.
Tide – Plenty of banks offer a cash reward for referring people so check out what deals your bank offers. For example, Tide, who we use abroad as we don’t lose money on fees, offer £50 to you and whoever you refer with a code which is a sweet deal. Here’s our code: ESAXBLKCC
Airbnb – Airbnb allows you to refer friends for Airbnb credit towards your next booking or new hosts.
Booking.com – They offer cash credit towards your next booking and up to £100 if you refer a new host.
Sous Chef – A website for foodie gifts and hard-to-find ingredients, they give you a ten-pound voucher for everyone you refer.
2) Selling Digital Downloads and Printables
For this, you need to consider what knowledge you have to offer. Though, don’t make the mistake of thinking you need major design chops or in-depth knowledge of a topic to pursue this route. This is one of the easiest ways to start making passive income right now with no platform of your own.
Anything you can make on your computer which can then be sold and downloaded on sites like Etsy, Creative Market, Amazon, Gumroad, and Redbubble can generate passive income. Most of your earnings will be pure profit after the platform takes seller fees and you account for the time taken to create the product in the first place.
Common digital downloads include: Ebooks (such as how-to guides), recipe collections, Lightroom presets for editing photos, Pinterest templates, media kit, and CV templates.
Common printables include: Sticker sheets, planners and to-do lists, greeting cards, colouring pages, bookmarks, and journal pages.
Make sure to write detailed descriptions of your product so they show up in consumer searches, and also have a link to your shop in the bio of your social media.
Tip: No design skills? No worries. The easiest way to create your own printables with very few design tech skills is Canva. You can use most of their features, include ready-made templates, for free.
The pro version gives you access to their stock photo and video library, and a great number of drawn illustrations that you can use. It really is one of the essential tools for any entrepreneur looking to create some marketing materials or a passive income empire. You can also use Creative Market to buy premade assets to use; many of these you can even upload to Canva to customise.
Read More: 7 Ways Digital Nomads Make Money Online
3) Generating Revenue from a Website, Podcast, or Youtube
If you built up your own platform, then you should absolutely take the time to monetize it. Aside from affiliate links, this can take the form of:
Ads – There are multiple ad partners out there and while one of the first companies people generally work with are Google Adsense, you will be looking at much higher earnings when you qualify to join companies such as Mediavine, Ezoic, Monumetric, Adthrive, and Shemedia to name a few. Each has their own requirements in terms of traffic. For podcasts, you can use AdvertiseCast to help you find ads and sponsors.
We’ve always been loyal to Mediavine who we use to monetize our other website and they’ve done nothing but work hard for their content creators. Currently, they require you to obtain 50,000 sessions a month.
Sponsorships – While this is active income rather than passive, it’s a nice boost to your income that often requires little work.
You’ve probably heard Youtubers and Podcasts shouting out to their sponsor or blogs which end with a phrase like ‘this article was sponsored by’, and Instagram pictures with #ad at the start. This all means that that person was paid to create content on behalf of a brand.
It doesn’t mean that that person doesn’t believe in whatever they’re talking about but it does mean there’s money involved. If you have an audience of some form (it doesn’t even need to be large if you’re a good fit for a brand) you can reach out to them directly or work with a PR company to work with their clients. Remember you’ll need to disclose the fact that you were paid.
Digital Downloads, Courses, and ebooks – These can be sold via your website or hosted on sites like Teachable. If you have any expertise to share at all, you can absolutely monetize that and share it with others.
Think about what you’re good at and what you can offer others. What do your friends come to you for help with or what do your followers or readers ask you about the most? That’s often a great place to start.
Membership – Some people very successfully set up some sort of membership to access content or products on their blog. You can also use sites like Patreon to offer exclusive content to your followers. Never underestimate the value of your content.
Read More: Ten Steps to Starting a Successful Podcast
4) Creating and Selling Tshirts and Tote Bags
If you’re sitting there thinking that you have no idea how to go about making a t-shirt or tote bag, and you have no room for stock in your house, think again. Platforms like Teemill, Amazon, Redbubble, and Printful will create the t-shirts for you and send them to your customers for you while you make a profit on each item sold (minus the cost of creating the product).
Once you’ve created your online store then it’s your job to promote your shop on social media to get the word out about your awesome designs.
If you have no idea how to go about creating interesting graphics for t-shirts, don’t worry. Many of these sites have free graphics ready to use, you can use Canva to make your own, buy a commercial license for a graphic on Creative Market, or simply pay an artist on Fivver to create something unique for you. You can also just show off your sense of humour with witty slogans using the text editor.
If you already have a brand of your own, like a blog or a YouTube channel, this is a great way to offer your readers something created by you and generate passive income.
5) Investing in Stocks and Shares
I wouldn’t start doing this without spending a bit of time learning about investing first. That being said, if you have savings then you could be getting a much better return on your money by placing your money into the stock market. If your savings are sitting in your account, the value is essentially decreasing with inflation.
In the UK, you even have the added bonus of using a Stocks and Shares ISA which mean you won’t pay any tax on the profit you make, including dividend pay-outs on up to £20,000 per year.
While it’s common to be scared of the stock market, it’s actually much easier to get started than you’d think, with companies like Vanguard or Hargreaves & Lansdown offering premade investment packages with varying levels of risk. Your returns, which can be as much as 8-10% stable income per year, can either be reinvested or simply provide you with a passive income.
Many people like to use apps like Freetrade and Trading 212 (which also offer ISA Accounts) for the simple interface and cheap trading. It’s as easy as adding money from your account and buying stocks in companies you’re interested in. You can then quickly sell when you’re ready and withdraw the money. You can also refer people for free shares.
Many retirees are able to leave their jobs and live off their dividend payouts comfortably until they pass. Why wait that long?
There are some great YouTube and TikTok channels that aim to teach you about investment so I’d spend some time researching before thinking about how your investment can create a healthy passive income that works for you.
Tip: If investing isn’t for you, then consider finding a Cash ISA or a savings account that offers a fixed rate of interest. This is often only 1-2% but it’s certainly better than nothing!
Dropshipping was all the rage a few years ago. Stories of folk chilling in Bali, making a ton of money selling products from China at a marked-up price were everywhere.
Now you’re more likely to see a ‘Is Dropshipping Dead?’ article and, certainly, with more and more people doing it and the obvious downsides to dropshipping, it’s not surprising.
One of the biggest issues with dropshipping is the time it takes for the product to get from China to the consumer. People are used to their packages being delivered fast (like, next-day fast), and people aren’t inclined to wait. Also, you have no control over the quality of the item or the state it arrives in, meaning you’re opening yourself up to potentially huge amounts of complaints that you don’t have much power to deal with.
However, people are still finding success with this method. I recently heard a friend of a friend was making thousands of pounds a month selling hypoallergenic cushions. And, of course, he’d never actually seen one of these cushions in his life.
So, if you do want to go down the route of dropshipping, here’s what I’d recommend:
1) Sell something specific that your customer can’t get easily. A general site selling things people can buy from within their country won’t cut it anymore. Niche down your shop so you can be found on Google easily.
2) Market the hell out of that item. You need a nice shopfront (using a platform like Shopify) and a pleasant user experience. You’ll also want to have your products on social media, such as Instagram, where people can find your items and shop. Consider writing blog posts about your products that will draw people to your site.
3) Rather than using sites like AliExpress, find a manufacturer and work with them directly. Obviously, this could come with difficulties like a language barrier but it is possible to find suppliers that will work with you, brand your items, and ship them in custom packaging. This way, if there is a problem with the order, you have someone to talk to and the customer will have a pleasanter experience all around.
Most importantly, treat it like a business and not a quick money-earner. Once you’ve done the hard work, there is very little you’ll have to do, aside from getting the word out, making it a great method of making passive income.
7) Writing Your Own Ebooks
If there are two under-utilized skills that many of us have, they are writing and teaching: two things that almost everyone can do. While not everyone has the skill to be a schoolteacher, we all have experience teaching our children, friends, colleagues etc.
Similarly, while most people don’t have the skill and experience to write a novel or a screenplay, we do all have the ability to express ourselves and help other people through our writing. If you have an area of knowledge and expertise, and you think you can pass that knowledge on to other people, that’s something you can monetise.
Anyone can earn passive income by writing an ebook on a useful topic and putting that finished ebook up for sale. Say, for example, you’re a skilled baker with your own handful of unique recipes. Take some photos and put them with a few pages of information and instructions. There’s your ebook finished and ready to monetize.
Whatever skills, knowledge, and experiences you have can be written down, mixed with a few photos, and turned into an ebook. So just think about what you have a particular knowledge of, or experience with, and start turning that into an ebook.
Ebooks can be made easily using Canva, then turned into a PDF and sold via Amazon or Etsy.
Ebook example ideas:
- If you can cook, make a recipe book (theme it around a specific style of cooking or baking).
- Take the knowledge you have about your day job and turn it into a how-to guide for other people to learn from.
- If you can play an instrument, write an ebook that teaches people the basics.
- Have you ever travelled? Write an ebook travel guide to a specific country or city.
- Are you a parent? Write a parenting guide.
- Take any skill you have and write a beginner’s guide (even if you aren’t an expert). Your skill might be: writing, photography, music, editing, YouTube, drawing, painting, cooking, baking, public speaking, collecting, sports, exercise, running, swimming etc.
8. Recording Audiobooks for Royalties
Another skills that many of us have and often overlook is talking. Most of us have a voice and, while many of us can’t monetise it by singing, we can still make money off our voices by talking.
Think about all the people out there who are self-publishing these days. Amazon has made that easier than ever. Those people often want their books available in audiobook format and, so, they turn to ACX.
ACX is a website for audiobook narrators and rights-holders to connect and work together on an audiobook.
If you’re a skilled talker with a pleasant voice, some patience, and a healthy reading habit, you can turn your voice into money by becoming an audiobook narrator. Joining ACX is free and easy.
This avenue towards passive income does require a bit of money. You’ll need a computer with some editing software (Audacity is free), as well as a decent microphone for recording (this will set you back at least $100). You also need to audition and that can be time-consuming.
If you have the time and a bit of money to invest in the right equipment, however, you can start auditioning for audiobook narration jobs.
When searching, keep an eye on the payment choice made by each rights-holder. They will either pay you PFH (per finished hour) and give you a price from a choice of pay brackets or they’ll pay you a percentage of the book’s royalties.
This is where making passive income comes into it. If you opt for the royalties option, you’ll be making money for as long as the book sells, every single time it sells. The more it sells, the more money you get; the more books you record audio for, the more money you get. Now, your voice is making you passive income.
Passive income can be life-changing and it’s certainly worth trying to make it work for you. I hope enjoyed this introduction to passive income and some of the most common ways to get started. You might also enjoy our guide to getting started with long term housesitting to help you save or give you a rent breather while you build your passive income dreams.