Many small business owners and freelancers dream of setting up viable passive income streams. It’s a system where you don’t have to get paid by the hour or project to earn. You just need to put in some work in setting it up and let it run to start earning.
For example, you’re a content writer and you get paid by the word. This means that if you write a certain number of words, you get a paid a certain amount for the work you produced. While the rate you receive might be excellent, there’s a ceiling that you’ll never break through because even at a good rate, you only have so much time and there’s only so much work you can do in a day.
But say you’re planning to write an eBook. You do your research, write the eBook, publish, and advertise it. You also build a landing page where people can purchase and download your eBook, and do some marketing efforts to drive traffic to this page. The checkout process on the page is fully automated so there’s minimal intervention.
While this sounds like a lot of effort up front, the good thing is down the line, the cash continually rolls in even with minimal effort.
What Is Passive Income?
What Passive Income Is Not
Unfortunately, there are some widely believed myths regarding passive income. So before we get into what they are, let’s first talk about what they aren’t.
A passive income isn’t a lazy way to make money. You’re not going to be sitting on a beach and sipping on a cocktail while the money rolls in. There’s work to do to set up a passive stream of income. There may also be some light maintenance. Be prepared to put in this work.
Passive income streams also aren’t just about making money. A passive income stream can help you deal with financial insecurity. It can give you a “salary” that releases you from having to work for every penny. You can give yourself a financial cushion that allows you time to focus on other aspects of your business.
Ideas for Passive Income Streams
How do people create passive incomes? Here are some common ways of doing this:
- eBooks. You can create eBooks and publish them on platforms like Amazon Kindle or E-Junkie. They can be selling on those platforms (as well as your website) while you take care of other aspects of your business.
- Evergreen Online Courses. Offer online automated courses and webinars. These aren’t live courses but pre-recorded and automated, and on “evergreen” topics that are always relevant.
- Digital Products. Create other types of digital products such as video tutorials and podcasts that teach your audience how to do something in your niche. You can make these available for purchase and download.
- Membership Sites. Create a membership site that charges for membership or runs on a subscription basis in exchange for exclusive content and special offers.
- Affiliate Marketing. Sell similar products on your website offered by other vendors for a commission.
- Ad Revenue. Offer ads for your high-traffic website or blog.
Aside from those mentioned above, there are many other ways to create a passive income depending on your audience, your expertise, and your sales funnel. This means that what might work for a digital marketer won’t necessarily work for a fitness coach.
Ask Yourself These 3 Questions
Before diving into your income stream of choice, this article from Inc. Magazine tells you to ask yourself these three questions:
- Do people actually want this?
- How hard will this be to pull off?
- What would be required to get this to the right people?
A good way to do this is to ask your email list what they want. Instead of asking randomly soliciting opinions on social media, its best to ask those who are already interested in what you have to offer.
What passive income streams have you tried out? Let me know in the comments below.
And if you need help with deciding on or setting up a passive income stream you can reach out to me for a free consult.