If you've found yourself on this page, odds are you're curious about the world of passive income. For most of us, the idea of making money in your sleep is a pipe dream or something reserved for the uber-wealthy. We're here to deliver the good news: you don't need to be a trust fund baby or the world's next great inventor to earn passive income.
All you need is an understanding of the basic fundamentals, your strengths, and a vision of the life you want to be living.
What is passive income and what are its advantages?
Colloquially, we understand passive income as "easy money" or "mailbox money," but passive income is a bit more complex. Ultimately, passive income is a return on your investment and allows your assets to work for you rather than you working for your assets.
The most common example is owning a house that you rent out to tenants or put on Airbnb or Vrbo for guests and collecting the profits you make from the home. In this scenario, the owner has made a generous investment (buying a home) but is allowing their asset (the house) to not only pay for itself but turn a profit as well. While they do have the responsibility of managing the property — though that is something they can outsource — they aren't going to be spending 8-12 hours at an office desk per day doing so. AKA, they're living the dream.
3 revenue streams you can benefit from in 2021
OK, but I don't have the capital to buy a home? Am I sh*t out of luck?
Thankfully, no. Passive income isn't limited to real estate, and in the age of technology, it's more accessible than ever before.
1. Stocks, bonds, and trading
While traditional investing may not be as sexy as starting your own company, it is a great starting point for beginners. Forbes contributor Melissa Houston shares, "A common method for passive income is investing in financial instruments such as bonds or GICs."
2. Affiliate marketing
Are you guilty of buying a product from an influencer's 'swipe up' feature on Instagram, or maybe you've purchased a specific brand based on a trusted recommendation? We've all been 'under the influence' at least once. It's not by accident; it's called affiliate marketing. And for those who are open to blogging or building an audience on Instagram, it can be very lucrative.
According to Taboola, "??The truth is that you'll have to do some work to set up your blog, choose your affiliate income programs and create content to promote them. But if you get it right, you shouldn't have to do much after it's set up, especially if you have some evergreen content that's optimized.
3. Amazon FBA Seller
If you haven't purchased from an affiliate link, you've surely purchased from Amazon a time or two. Or one hundred. But you're not exactly buying products hand-crafted by Jeff Bezos or his team; you're likely buying from an Amazon FBA seller.
According to xoNecole, "As an Amazon drop shipper, you're responsible for fronting the inventory costs, but Amazon handles the day-to-day operations and customer service." Though a heavy investment on the front-end, this could land you with a six-figure salary without needing to go back to business school or learn a new trade.