As an struggling young Engineer (back in the Carter era) I bought anything I could renovate then rent to justify paying the 18% interest. I never took vacations but worked on my properties all in the pursuit of passive income. I drove junk for many years & many months I just got by on credit cards. My friends & colleagues were amused by my ‘stupidity’ but most are still working to make enough for retirement.

You don’t have to invest individually to take advantage of dividend paying stocks (i.e. investing in an ETF like DVY, which currently has a 3.16% dividend yield – almost 4%). And while your math is indeed correct, there is more to dividend paying stocks that just the math. The reason the companies pay dividends is typically because of their underlying strength, steady growth, etc. These companies can be good investments for the long run. As such, it might not make sense to sell.


I’m somewhat embarassingly reminded of Harry Potter and the concept of “Horcruxes” here, in that the goal is to find a piece of your value, and impart it into an inanimate object or product, Voldemort Style (did I really just make a Harry Potter reference?) Anyways, whatever. If you want passive income, you have to think about the value you rent out or own. Or, you need to buy something valuable that other people would like to use (I love the idea of a 3D Printer). Then put it into something that can be sold or rented more passively. Maybe you have a car that sits in the driveway, or a vacation home that is empty half the time. Maybe you just have some funny jokes you could put into a YouTube video and run ads on. At some point, you have to “transfer” the value into something that can work for you — that something is an asset.


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You can try and start another travel blog, but every twenty-something who’s visited South East Asia has one; the market is so saturated that it will be very difficult for you to stand out and start making money. Instead, if you find something you’re interested in that is underserved, you’re far more likely to be able to carve out a space. You’ve a far greater chance of making money with a blog for vintage BMW owners than another generic Thailand travel guide.
One of the easiest ways to increase your passive income is to shift your savings to a bank that pays a higher yield on your savings — for example, Discover Bank and EverBank pay almost 1% for your money. Although it doesn’t sound like much (especially in this low interest environment), little things do add up and eventually interest rates will rise.
You need to decide which machines you want to run, get the necessary licenses to operate them (you're selling items so you need to get sales licenses and whatnot from your state), buy the machines and a truck for the items in the machines, find a supplier of the products, and then finally you can secure locations. Finally, you need to service them periodically or hire someone to service them.
2. You clearly have plenty of money already. Just more padding in your already cushy nest. This is not the story for a lot of people. Your title should be “How to become richer than you already are without working.” But, actually the investment one is the only one that would make money without actual WORK. Running rental properties is a lot of work, and so is running a business, or even a blog. Sooooo…..while there might be some truth to this, I think it’s mostly grass that looks greener because it’s on the other side of the fence.
Finally, I imagine the biggest debate with my ranking is Creating Your Own Product as the #1 passive income source. If most people have never created their own product, then it’s easy to give it a thumbs down. There won’t be much complaint about Private Equity Investing being in last place because most people are not accredited investors. But given I believe that plenty of people can create their own product if they try, pushback is inevitable because a lot of people simply don’t try!
Now, how do you do it? Building a passive income will require some work up front, but choosing a method that plays to your strengths will yield the most success, and it can even become a fun hobby! Have an aptitude for photography? License your photos to stock photography websites. Or maybe you’ve always wanted to invest? Learn how with a robo-advisor. No matter what your strengths are, we’ve gathered 35 ideas for different ways you can generate passive income and build your wealth.
Investing is arguably the easiest way to make passive income.  The problem is most investments sound good in theory but don’t work out so well in practice.  And if you don’t have much experience or access to capital, let alone the time to work it all out, it can seem more or less impossible.  However, there is one smart way to invest that just might work.  Continue reading >
Michael Ellsberg is the author of The Education of Millionaires: It’s Not What You Think, and It’s Not Too Late, which is launching from Penguin/Portfolio in September. It’s a bootstrapper’s guide to investing in your own human capital at any age. Michael sends manifestos, recommendations, tips, and other exclusive content to his private email list, which you can join at www.ellsberg.com. Connect with him on Twitter @MichaelEllsberg and on Facebook.
Though it requires a huge up-front investment (well, at least 20%), real estate is awesome, because it’s (usually) pretty stable, and it’s a triple-whammy: you make money by leveraging a bank’s money, you can rent it out with almost no work at all day-to-day, and the value of the underlying asset INCREASES. This is why so many people flock to AirBNB to rent out their apartments when they’re going on vacation, too. It’s pretty passive, you don’t have to own the asset, and you just hand over keys and hire a cleaner before/after. The value of your apartment is untouched. By contrast, imagine buying a plane and renting it out to people for tours — you pay tons of money to maintain it, and after 20 years, it’s value is almost nothing. The exception is if you can manage depreciation and somewhat automate the value-delivery. If you have an expensive tool (like a 3D printer) and charge people to come over to your house and print things on your 3D printer, it’s pretty passive for you to answer emails and open the door, so I give it a “Semi to yes” for passivity.

The only thing better than making money is making money while you sleep. That’s the whole concept behind passive income. You can spend more time with your family and friends, perfect your golf swing or learn another language. The possibilities are endless because you’ve set up passive income streams that provide you a paycheck without needing to clock in. Here are the 10 best passive income ideas that will rock your world.
In June, he put ads on his site with Google Adsense, and within the first hour, earned $1.08 with three clicks. He earned $5 the first day, $7 the second, and then eventually began pulling in $15-$30 a day. In October, he created an ebook exam study guide priced at $19.99. By month’s end, he earned $7,906.55 — more than he had ever previously earned in a month.
Also, if you pursue an income stream like affiliate marketing, your blog can be a source of content that allows you to link to affiliate sites in a way that is seamless and natural. For example, if you are an affiliate marketer for a company that sells productivity tools, you can blog about your own struggles to stay on top of your to do list. Then, you can mention how much those tools have helped you.
I do remember you mentioning that & how it was your ticket to exit softly and give you time to build the passive income side. Most likely when I do exit it will either be through a sale of the business which would come along with a employment contract or if a worthy successor(s) can take it over, then the business is just another annuity throwing off income. Anyway, I’d enjoy writing a guest article after I survive the next few weeks of work and weddings.
Once your audience has grown and you have validation that you’re offering them value, there are many ways to create passive income. You could sell digital products like ebooks or courses, take up affiliate marketing in which you promote other company’s products and earn a commission when you sell that item to your audience, build a community and charge people to be a part of it, create software and sell that, among other avenues. Ask your audience directly what would serve them best, or look at what they’re saying on Twitter, Facebook or other websites, to find out what problems they have and how you could help solve them.
Affiliate marketing means you sign up with a company and/or entrepreneur and sell their products. For example, if you start a tech website, you could become an affiliate of a web hosting or anti-virus software company. You can earn hundreds or even thousands of dollars each month if your website receives a decent amount of web traffic and you have thousands of email subscribers. Being an affiliate marketer takes dedication and time. You need to build traffic via your website, email marketing and social media. Is this for you? You be the judge.
As interest rates have been going down over the past 30 years, bond prices have continued to go up. With the 10-year yield (risk free rate) at roughly 2.55%, and the Fed Funds rate at 1.5% (two more 0.25% hikes are expected in 2018), it’s hard to see interest rates declining much further. That said, long term interest rates can stay low for a long time. Just look at Japanese interest rates, which are negative (inflation is higher than nominal interest rate).
Active income, on the other hand, involves earning money in exchange for a service. It could be a salary, an hourly wage, commissions, or tips. It’s essentially a trade of your time for a fixed dollar amount. Most people choose to live this way, and there’s nothing inherently wrong with that, as long as you understand that there will be a limit to how much money you can realistically earn.
Let’s continue the vintage BMW idea. Old cars obviously require quite a lot of maintenance. Many people will buy a “fixer upper” with the intention of spending their spare time repairing and restoring it. There’s a very obvious market here: a guide to restoring different BMW models. Depending on your knowledge, you could produce detailed guides for the three or four most popular models and sell them. Not everyone restoring a car will buy them, but some probably will.

The term affiliate marketing has taken a bad rap over the years, primarily because people are abusing just how easy this is to do. Internet marketers are finding products they don’t even use because they come with a sweet commission, and are spamming everyone until they either buy, or unsubscribe. This is also known as the dark side of affiliate marketing.


You know the fantasy: write some ebook (or better yet, hire freelancers in Mumbai to research and write it for you at $.20/word!) on some niche topic, set up AdWords and Facebook campaigns targeted to the right keywords (you can hire those Mumbai guys to do your keyword research too), put up a cheap landing page (with copy written by... guess who!), press "Go!" on the PPC campaign, and voilà. . . just wait for the money to roll in while you sleep!
The great part about creating truly passive income is the money comes in every month without you having to sell your investment or worry about running out of money when you retire. The returns are also better for me with rental properties, because my cash flow is producing about a 20 percent cash on cash return and that does not even include equity pay down on my loans or appreciation. The appreciation on my rental properties is a bonus for me, while stock market investors are depending on it.

He used "house-hacking" and "live-and-flips" to increase savings and maximize earnings, and by 2007 he and his business partner owned 50 rental properties. Save for a few setbacks during the financial crisis, Carson continued growing his portfolio over the past decade, and today he manages 90 rental properties, mostly in and around his hometown in Clemson, South Carolina.


So many great tips in this big post, thanks! I think it’s so true that people should focus on the things they do well at and are interested in. And yes save, save, save in the beginning and throughout. I have several interest and dividend earning investments and am looking to expand further. Diversification is a great goal for all of us so we can avoid having all our eggs in one basket.
I wish I had more time to put into real estate. Given the run up since 2012, I may even be interested in selling my condo that I currently rent out. I need to get it appraised to really see what it’s worth, but I think conservatively it’s gone up ~50%, although rent is probably only up ~10% or so. I am bullish on rents going up in the future… mostly in line with inflation, or perhaps even slightly faster due to constricted credit and personal income growth which should provide a solid supply of renters. At this point, I just don’t want to manage the property. I’ll probably look into a property manager as my time is likely worth turning it into a nearly passive investment.
I think the holy grail of financial freedom is having so many passive income. This way you will never worry about your financial needs because everything is taken care of your assets. You will have all the your time in the world and visit all places you dream about. You have your time and money. This is the dream of most people which only few ever achieved.
5 months ago, I decided to create my own online business. I was really exacted because It was always my dream to earn cash by working from home to be able to unite my family and to retire my father that had been working as a security far away from home. My family and I only used to see him three times a year. I would like to change it, and online business gave me a possibility to make my dream to become real. I really was committed to giving all my self to succeed in building a successful online business. As a matter of fact, I failed to do it on my own. I was so disappointed because it seems that I was born to fail. It was 22nd June at night, I was hearing a motivational speech, so one of the guys said,” Copy what successful people’s strategy as your own, and you will get the same result that they have”. That opened my mind because that was the secret, I did not realize that there are a lot of people in this marketing a year. So, I took some online courses from gurus. Following their steps. right now where am I? I am now a successful online business of 22 years old trying to retire his father. I really thank people a lot that have the mindset to share this priceless information in this blog. Indeed, thank you.
I’m feeling inspired! I’ve been a PT for 19 years and I feel I have so much experience to offer but have been so intimated by starting a blog. I also subscribed to Michelle’s website but wasn’t sure it was for real. Is it for real? After reading this I feel like it’s time to take the plunge, I need to start a blog, I have so many ideas and even course ideas. I want to get away from the paperwork that plagues our healthcare system but not leave the field so the blog just might be the answer. I’ve been a landlord for 15 years now, great investment for sure, renters paid for the down payment of our house and should hopefully help pay for our kids college. I’d love to have one more! Thank you for the inspiration, wish me luck with my blogging!

Non-fiction e-books that educate your potential audience on specific topics like finance, online marketing, and business are going to make you more money than fiction books. Of course, there are always exceptions and you could write the next Harry Potter book, but if you want to create some residual income opportunities quickly, I would suggest you go for what sells first!


Good ranking FS, I’d have to agree with the rankings. And it looks like your portfolio covers five of the six! Some people consider real estate passive will others classify it as active. But every scenario is different, whether you are doing all the maintenance and managing yourself, or you are contracting out a lot of the work. Obviously it takes a lot more time and effort than purchasing a 36 month CD and “setting it and forgetting it.”

A business factoring company that seamlessly integrates with a particular sales-tracking software and provides real-time distribution of commissions. You would need to find a factoring company or an investor who specializes in funding direct-response companies, a risk analyst to audit risk associated with each sale within a company, and a third-party payment verification service.
However, I think for those who are willing to do what it takes, the sky is the absolute limit. As an example, I’m trying to take a page out of FinancialSamauri’s book and create an online personal finance and investing blog. It is an enormous undertaking, and as a new blogger, there is a seemingly endless amount of work to be done. That said, I hope that one day I can not only generate some passive income from the hours of work I have put and will put into the project, but I hope to be able to help OTHERS reach their financial goals.
We are going to start with 1.5 years of all spending needs in cash. We will draw 1800 to 1900 per month. We will add to this from the index funds by taking a portion of the gains in good years to supplement. This is the total return portion of the equation. Obviously, if stocks decrease drastically over a 5 year period, then I would have to reload by selling some of the ETF holdings.

Let’s continue the vintage BMW idea. Old cars obviously require quite a lot of maintenance. Many people will buy a “fixer upper” with the intention of spending their spare time repairing and restoring it. There’s a very obvious market here: a guide to restoring different BMW models. Depending on your knowledge, you could produce detailed guides for the three or four most popular models and sell them. Not everyone restoring a car will buy them, but some probably will.

After spending that time learning as much as I could, the next logical step, to me, was obtaining my real estate license. I thought having it might make me a more informed real estate investor, and perhaps I’d be able to benefit from buying an investment property as an agent and save on commissions. I also thought I would potentially have access to deals earlier than the general public.


I do agree that a few of these ideas are not bad, but for me the problem with some of these platforms has been that I’m not from the USA. So, I can’t operate there. It’s a really interesting possibility to get some extra bucks from doing what you would do either way, like shopping. One of the best projects so far that I have seen is FluzFluz. It’s simple and really easy to use for everyone who uses Uber, Amazo, or other apps. The best part of all is that you can get some passive income – not just from your own purchases, but from other people’s as well. I hope one day it will make it here to your list. I think it’s worth it to check out.
Peer-to-peer lending ($1,440 a year): I've lost interest in P2P lending since returns started coming down. You would think that returns would start going up with a rise in interest rates, but I'm not really seeing this yet. Prosper missed its window for an initial public offering in 2015-16, and LendingClub is just chugging along. I hate it when people default on their debt obligations, which is why I haven't invested large sums of money in P2P. That said, I'm still earning a respectable 7% a year in P2P, which is much better than the stock market is doing so far in 2018!
From what he describes, creating passive income definitely does not sound easy. It requires a serious ramp-up -- often requires 80- to 100-hour workweeks in the beginning, says Flynn. But once up and running, and depending on the content, some sites take fairly minimal maintenance. Green Exam Academy, the LEED exam study site he launched in 2008, takes just him four to five hours a month to maintain but brings in $250,000 annually.
​If you pay your bills with a credit card make sure it offers cash back rewards. You can let your rewards accrue for a while and possibly put the easy money you earned toward another passive income venture! (Be sure that the card you select doesn’t have an annual fee or you might be cancelling out your rewards). Check out this list of the best Cashback Rewards Cards.
My returns are based on full cash purchase of the properties, as it is hard to compare the attractiveness of properties at different price ranges when only calculating down payment or properties that need very little rehab/updates. I did think about the scores assigned to each factor, but I believe tax deductions are a SIGNIFICANT factor when comparing passive income steams.
Absolutely Federico. I still invest in real estate but no longer carry the misconceptions that it’s passive income. Fortunately, I’ve held my real estate properties long enough that they cash flow even after paying for management but it was a lot of work in the beginning. Real estate is a great investment but passive income investors should look to REITs and other investments rather than direct investment.

Betterment – Betterment was the first robo-advisor to launch, almost ten years ago. They’ve automated the entire investing process, so all you have to do is watch your portfolio of assets grow (over the long run, of course). They do charge a .25% annual fee of your account total, so if you’ve got $100,000 that’s being managed by Betterment, you’ll pay just over $20 per month.

But what about everyone else with lower capital bases, less time and the desire for potential higher returns?  Well, that’s where one of my specific investing strategies may be of interest.  It’s an approach favored by some of the world’s best investors – even Warren loves it – and I explain it in plain English here #1 Way I Invest My Money To Target High Returns.  I think you’ll love it!

Ebooks are one of my favorite sources of passive income. Now, you can do this the simple way and just publish it on Amazon's KDP. Or, you can go all out and build yourself a book funnel. Book funnels are powerful, but they won't be fully passive. For example, if you do a free-plus-shipping offer for your ebook (converting it into a physical book), you'll need to create some one-time offers (i.e. extra training) and up-sells (i.e. an audiobook). But, a book funnel can be very powerful.


Dividend investing is right up there for sure. You don’t have to charge $48. You can charge <$10 to boost sales. The internet has enabled so many creatives to publish their works at a low cost. People will surprise themselves if they try to create like when they were in school. The other reason why I have Creating Products edging out dividends is because of the much higher POTENTIAL to make a lot more money. For example, $20,000 a year in book sales requires $570,000 in dividend investments to replicate the same amount. Plus, there is capital risk. With book sales, there is a correlation with EFFORT, and you are not beholden to the whims of the markets.
It’s a (mostly) short term, higher risk, higher reward place to invest cash that has a low correlation with the stock market, but is far more passive than buying and managing properties, has more opportunity for diversification than private placements (minimums of 5-10K, rather than 100K), and most of the equity offerings (and all of the debt offerings) provide monthly or quarterly incomes. Unlike a REIT, you can choose exactly which projects you wish to invest in.

Crowdfunding is a newer way to invest, having emerged onto the scene just within the last few years. Most people have heard of sites like Kickstarter and GoFundMe, and a very similar concept exists for real estate. Developers are always looking to raise capital to fund their projects. Through the various online platforms, investors have access to these projects and can choose to invest in both residential and commercial properties. See the List of My Favorite Crowdfunding Sites.
I’m looking at accepting a professor job. It’ll be more than a 50% pay cut. But I’ll have the same life you describe – endless summers and an entire month every winter to ski. I’m thinking in the end, eventually, I might even end up wealthier in more ways than one. Happy people tend to be the most successful. I have no desire to diversify. Dividend stocks allude me. CDs seem like a good choice for older people, but I have time on my hands and real estate knowledge, so I’m sticking with what I know, despite the fact that most people will tell me it is foolish and I should diversify.
As todays business world becomes more and more web focused, creating passive income streams online should be one of your main focuses when building a business in the new economy – whether you’re doing this on your own, or with the help of virtual assistants that manage your blog, or even handle the marketing of your site – you’ve got to love making money while you sleep!

Within six months of selling, however, I had reinvested the proceeds from the home sale and brought total passive income for 2018 back up to an estimated $203,724. I'm not sure I would have sold the house without a clear plan for reinvesting the proceeds, since I'm bullish on the SF housing market long term. However, because I did have a plan, and the challenges of raising a newborn and dealing with rowdy tenants left me feeling a bit stretched, I decided to simplify and sell.
Anthony, nice setup! To your question about the rental mortgages, you haven’t said what interest rate you are paying. As a start, if you are paying more than the risk free rate (Treasury bills) which you probably are, then a true apples to apples comparison would be yes, pay off the mortgage. But, if you are comfortable taking more risk, you have other options to invest in which you *hope* will yield you more over the coming years. You also didn’t say whether the rentals generate net income and if so, how much? What is the implied rate of return on the equity you have invested in them? If you pay the mortgages off, you’ll have even more equity tied up, will the extra net income make that worthwhile? Maybe you should use the money to buy more rentals instead, if purchase opportunities still exist in your town. … this is less of an answer than a framework to analyze the decision, hope it is helpful.
A perfect example of the Active Problem Solving + Automation concept is in my online courses I’ve created over the years, or my free webinars I’ve created more recently Each of my online courses and webinars are targeted to help people with specific problems, whether that’s in the area of affiliate marketing, podcasting, building a brand, and so forth. I am always improving upon the courses, but they are also evergreen for my audience.
The reason I consider dividends artificial and believe they don’t matter is because you can just as easily reinvest your dividends. If a stock is worth $100/share, I don’t care if it issues a $1/share dividend or if the share price instead increases to $101/share – either way, I have the same amount of money, because there’s no difference to my net worth whether I take the dividend or sell part of a stock.
At age 55, I own high-end rental properties (near the beach) and commercial buildings servicing the medical industry. I was widely criticized during my career for not living up to my income; that is, buying big homes with many fancy cars. I married a great woman who understood that saving and investing today meant a better lifestyle and more freedom tomorrow. Our passive income is half of my active income from sales, but my net worth has increased substantially. We are both happier and healthier than we were in the high-stress pressure cooker of franchise sales. The naysayers have become converts to the concept of passive income, but they have locked themselves into a “big hat, no cattle” lifestyle. It has been a great ride!

Bullshit. If you have a job, you have marketable value. Maybe it’s low value, if you’re flipping burgers, but you can create value somehow. I don’t care if you have to start out by re-renting the parking spot in front of your apartment, you can find, create, or buy something valuable worth repeatedly selling or renting, or you’re not thinking hard enough. Here’s a free idea: A lot of people want to play with 3D printers. Get 5 of your friends together and buy one. Put up a website and a listing in the local paper. Charge $50/h for printing. Set up a system that verifies if payment has been submitted and then automatically prints out the files that have been emailed to you. Split the earnings with your friends. Boom. You have passive income.


Using ad networks like adsense doesn’t prevent you from targeting advertisers directly. In fact, that’s how I started; I searched the net for potential advertisers who advertised products relevant to my content and offered them yearly packages. If you choose this option, bear in mind that you’ll need to provide traffic reports and other site statistics.
In 2017, I ended up deploying roughly $611,000 into stocks and $604,327 into municipal bonds. The stock allocation should boost dividend income by about $12,500 a year, and the municipal-bond portion should boost income by about $18,000 a year after tax ($26,000 pre-tax). Therefore, total passive income gets an about $38,500 lift, which recovers over half of my $60,000 loss from selling the house.

I read about early withdrawal penalties on IRAs/401Ks very often. Almost always with a statement of “locked up” or “can’t touch” until 59.5. I’m sure you and well informed readers as well know about SEPPs in regard to IRAs/401Ks. For those that don’t SEPPs aren’t perfect but they are a way to tap retirement funds penalty free and I will be using in the future as I have over half of my equity investments within retirement accounts. South of a mil, North of a half. Let me add that I think your blog is outstanding.
Flynn has created many different products. While his LEED exam is what got him started, he has both earned a commission from selling other people’s products and offered a commission to others who would sell his wares, and also recently created his first software, SmartPodcastPlayer.com, after realizing that most online podcast players offered only the basic stop/start/volume features. He hired a development team to create a superior one, which was a success from day 1. “We sold out 250 beta licenses in less than 24 hours, because I was addressing a need but also, I had built up an audience and trust with them … When you build that amount of trust with your audience, whatever you come out with, they will love.”
Lending Club is a platform where you can lend your money to other people. You’re the bank. Each note is only $25, so you can invest $1,000 and lend money to 40 people. There are many grades of loan (from safest to riskiest) and investors earn, on average, between 5% and 7% annualized returns. For more information, check out Investing and Making Money with Lending Club Peer-to-Peer Lending and my real money Lending Club Portfolio.
That strategy seems waaaayyyy less risky than actively picking stocks of supposedly “reliable” stocks that issue dividends, which could be cut at any time due to shifting industry trends and company performance. Dividend investing feels like an overly complex old-school way of investing that doesn’t have a very strong intellectual basis compared to index investing.
Logan is a CPA with a Masters Degree in Taxation from the University of Southern California. He has been featured in publications such as Debt.com. He has nearly 10 years of public accounting experience, including 5 with professional services firm Ernst & Young where he consulted with multinational companies and high net worth individuals on their tax situations. He launched Money Done Right in 2017 to communicate modern ideas on earning, saving, and investing money.
The reason I consider dividends artificial and believe they don’t matter is because you can just as easily reinvest your dividends. If a stock is worth $100/share, I don’t care if it issues a $1/share dividend or if the share price instead increases to $101/share – either way, I have the same amount of money, because there’s no difference to my net worth whether I take the dividend or sell part of a stock.

This is the basic mistake they've made: they've fallen prey to the belief that money and meaning are two totally separate things. They've chosen to make their money from something that feels completely meaningless to them (some business they care so little about, they just can't wait to get away from it and minimize their involvement as much as possible), which they hope will buy them the freedom to do something they actually care about.

I enjoy how you lay out real numbers. A lot of people wouldn’t do that. While you admit that you are somewhat conservative, I think the $1M in CD’s is just too conservative. Assuming you don’t need the cash flow now (which you say you just save anyways) then all that could be invested for potentially higher returns. For example, what if you bought San Francisco real estate along the way instead of CD’s. Or, an SP500 Index fund. I bet your average return would have been higher than 3.75%. Sure you could lose it, but the point is if you don’t need the cash flow now, you should try to increase that nut as high as possible until the day you actually need it. Your nut could be $5M right now if you had invested in asset classes other than CD’s for the last 14 years. Don’t get me wrong, you have done far better than me, but I guess I would take a little more risk if you don’t rely on that cash flow.
Get paid to take surveys at home by signing up with one or more survey websites. All you do is answer questions and voilà, you get paid. Another way to earn extra income is to participate in focus groups. Companies hire focus groups as a way to test out a new product before it hits the market. Why? Because they need to make sure it will make money; they want a high return on their investment. Surveys and focus groups may not make you a millionaire overnight, but you can earn hundreds of dollars each month by giving your opinion on products and services.
Investing in rental properties: Another form of real estate investment, rental investments (i.e. becoming a landlord) could steer you down the passive income path of steady monthly rent checks that you can use to pay off a mortgage loan on the rental property. After the mortgage is paid off, those monthly checks go right into your bank account -- potentially for years to come. 
If it is one thing I would like to say is that I sold my first item on Ebay in 3/14 after being unemployed for 2 months. Since then I have discovered the bottom line secret of making money online… The secret is this – *There is no secret. Any legit idea/stream/online business can be made a steady stream of income. IF you are willing to put in the effort.

Again, no leader worth her salt will be attracted to such an opportunity. And anyone you do hire to lead the value creation, if they have two brain cells, will see that she's the one adding all the value. Sooner or later she will simply find a way to cut you out of the value chain, either by requiring more and more compensation, or by going off and competing against you (and actively at that.) Why does she need you? You're not adding any value anyway!

We’ll look more closely at how to find a property’s NOI later in the article. There are two ways to look at the cap rate formula above. If you know what kind of return you want to achieve or the average return on similar properties, published frequently for commercial real estate investment, then you can find an approximate value by dividing the NOI by required return (NOI/return rate).


Well, my first book project didn’t generate the interest I would have liked to, but another set of products suredid. In 2013, I launched a course on Udemy, which grew so fast, it became my biggest income earner of all time. That course resulted in a series of books (audio, digital, and print), a not-so-passive podcast, and even lead to my now full-time gig: SuperLearner Academy. Though I run the company full time, it is, for all intents and purposes, an automated business.
Do you think it’s possible to build a blog from scratch, outsourcing the work from day one (assuming I have some cash that can cover the initial expenses until the blog generates enough income to at least break even)? In other words, do you think you could you have spent your $500 max per month for the writer, social media expert, etc to build your blog to the point it’s earning the same amount of money it does now?
Another great way to get started is to identify an area of interest you have. For instance, Robert Duff has been successful in building passive income by selling books on Amazon. Then, go out and start talking to people. Ask them, “What are you struggling with right now? What are your biggest pains? What’s something you wish existed that doesn’t?” That’ll give you some ideas about where to get started.

I’m not a software developer, and my early software projects (Blackberry Apps) failed because after paying a developer to build the product, I didn’t anticipate needing to update it regularly or provide support for it. For years after that, however, I had a partner who helped me upgrade our software once a year, and provided support if there are any issues (pretty rare). In 2013, we released our third module for Magento (they range from $49–149), and then ended up building a pretty successful SaaS product for Shopify. I left the business to my partner, and it still pays him over $3K a month in completely passive income. He updates the software every few months and answers the occasional customer email. Not bad!
They also launched an incredible Retirement Planning Calculator that pulls in real data from your linked accounts to run a Monte Carlo simulation model to output the most likely results of your financial future. I strongly suggest you run your own numbers, play around with the income and expense variables, and see how you stack up. It’s all free and easy to use.
Those who choose to focus on passive income will need either family money, funds from investors, or the nerve to borrow large sums by taking on debt to fund the purchase of assets. Consider someone who takes out substantial bank loans to build an apartment building or buy rental houses. Although this can turn a very small amount of equity into a large cash flow stream, it is not without risk. When using borrowed money, the margin of safety is much smaller because you can’t absorb the same degree of setback before defaulting and finding you balance sheet obliterated.
Real Estate Crowdsourcing – After selling my SF rental house in mid-2017 for 30X annual gross rent, I  reinvested $550,000 of the proceeds ($810,000 total) in real estate crowdfunding, based in San Francisco. My goal is to take advantage of cheaper heartland real estate with much higher net rental yields (8% – 12% vs. 2% – 3.5% in SF) and diversify away from expensive coastal city real estate which is now under pressure due to new tax policy which limits SALT deduction to $10,000 and new mortgage interest deduction on mortgages of $750,000 from $1,000,000 for 2018 and beyond.
What's crazy is that my book income is more than my SF condo-rental income. Yet I didn't have to come up with $1.2 million of capital (the minimum cost to buy my condo today) to create my book. All I needed to create my book was energy, effort, and creativity. I truly believe that developing your own online product is one of the best ways to make money.
Like we said above, there’s nothing passive about this, but if you can create another type of asset — a system for selling products — then it is. One example is to write a book, and use Amazon Fulfillment Services to automatically print and ship it every time you sell a copy, depositing the money in your account. Another example is Tim Ferriss, who hired overseas assistants to handle everything at BrainQuicken, from the marketing to the reordering. With drop-shipping (having the manufacturer ship directly to your customer), this has become easier, but you should know that it’s still a good bit of human labor to advertise, handle customer service, etc. But, it’s a good option, and you can experiment with automation and delegation as you go along. If you want to know more about this, read The Four Hour Work Week already!
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