Passive Income. Money made while you sleep. An income you get paid after you finish the work. First, let’s look at why you want it. And second, the top five ways to make passive income.
In your regular job, you trade time for money. That’s an active income. With passive income, it doesn’t matter if you put the time in, you still receive money.
Millennial Money Man tells us, “And here’s the beautiful thing about passive income, earning from one source often allows you to build another source of passive income, then another, and another. This is why you hear that most millionaires have seven streams of income—most of them are passive!”
“Earning passive income means creating more time to pursue fulfilling ventures… to bring you closer to financial independence. …You want to generate multiple income streams and escape the 9-5,” says a post on Listen Money Matters.
So, having passive income helps you generate more income to allow you to reach financial independence. Great. How do you do it? There are tons of ways to generate income. Let’s look at five ways you can make passive income.
Listen Money Matters has a blog with 35 strategies to make passive income this year. It also ranks each one by the amount of effort required. Grouping a few of their ideas together, our number one is to Rent Your Stuff.
You can rent a room, your entire house, your car or your parking place. Depending on where you live, be sure to check your local laws. But Airbnb, Roommate finder and Rent Like a Champion will connect you to people looking for places to stay.
Turo, HyreCar and Getaround will let you put your car in the carsharing marketplace. Just review the service charges of the companies to make sure you’ll really make a profit.
Pavemint, Spot Hero and CurbFlip will match your parking spot up with drivers looking for a place to park.
Pay Down Your Debts is one of the ideas listed by Brian O’Connell in a blog titled “20 Passive Income Ideas for 2020.” He says, “Think about it. Money you’re not paying credit card companies and lenders is money you stash right into your savings account.”
“By not paying interest to lenders and using the money to have others pay interest to you, you’re engaging in perhaps the purest form of passive income – and enriching yourself in the process.”
Another idea he shares is Peer-To-Peer Lending. “By lending to individuals, organizations and small companies who don’t qualify for traditional financing, you can earn up to 10% in returns.”
He cites Lending Club as a peer-to-peer lending platform and says, “You can lend $100, $1000, or more to borrowers who meet lending platform standards. Like a bank, you’ll earn interest on the loan – often at higher returns than banks usually get.”
Earning Credit Card Rewards is our fourth way to have some passive income. Millennial Money Man, Bobby Hoyt wrote in his blog, “Some people in the personal finance world completely demonize credit card use. And yes, there are dangers if you don’t pay your balance off and on time every month.”
“But if you know you can use credit cards responsibly, you can earn points, travel miles, and cashback. I like using credit cards to earn travel rewards, and I’m able to pay for the majority of my airfare with points alone.”
Several websites listed various forms of Investing as popular ways to earn passive income. However, you shouldn’t lose sleep over your passive income investments and that’s where iFlip comes in.
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