“Work smarter, not harder” is the idea behind passive income. Passive income is any money you earn from putting in little to no effort. Sounds good, right? Luckily for you, the opportunities to earn passive income have never been better. The sharing economy, gig economy, and new technologies have all led to countless opportunities for regular people to earn cash by putting their assets (anything they own) to work. Here are our 6 top picks to earn passive income.
1. Get crafty with an Etsy shop
Etsy is so much more than crafts. It’s a supersite where literally anyone can sell art, clothes, or crafts. The upside of Etsy is that it requires little to no money to get started. All you have to do is think of something you can make and sell. The downside? You’ll have to put in some work up front not only building your Etsy page, but also getting the word out. The other upside? Once you do that, you’re pretty much set. You can kick back, put in a few hours of work a week, and watch the earnings roll in from things you created.
2. Take a walk down Wall Street
You’ve got to spend money to make money, right? Except, it’s not really spending. It’s investing! Parking your money into stocks, bonds, mutual funds, ETFs (exchange traded funds), or other financial products can be a great way to watch your money grow over time. The big draw of investing is that after you hit ‘buy’, you literally do nothing. If you’re patient and do your due diligence researching a stock or bond, you can often make far greater returns than you would leaving your money in the bank or under a mattress. A drawback of investing is that unless you really hit it big by picking the next Google, Apple, or Tesla, it’s hard to make a lot of money unless you start with a solid chunk of change. And if you started with a lot of money, why would you need to look up passive income ideas?
3. Share your car for cash
Have a spare car or live in a city where you don’t drive much? You can put your car to work while you’re not using it and earn hundreds per month. Car sharing is an excellent way to earn passive income. New car sharing apps are popping up everywhere, making it easier than ever to turn a parked car into cash. Each company varies a bit, but some like Avail don’t require you to do any work whatsoever. You just drop off the keys, kick back and earn cash. Even better, Avail protects every trip with insurance from Allstate and includes customer support so you don’t have to worry in case the unexpected happens.
4. Become a host on Airbnb
Have a spare bedroom or living space you’re not using? Spruce it up and put it up for rent on Airbnb. Renting out a room short-term is an excellent way to earn passive income, and you don’t even have to leave your house. You can earn up to hundreds of dollars a month on Airbnb, especially if you live in a picturesque rural area or in the heart of the city. You’d be surprised at the people who would love to pay for a night, week, or sometimes longer. Listing your place on Airbnb is as easy as taking a few pictures and posting it to your profile. Heads up: you’ll want to do a quick check on your local laws, as some cities require you to have a license first.
5. Loan money with peer-to-peer lending
Lending money to friends and family? No way. Lending money to strangers on the internet? Great source of passive income. Jokes aside, peer-to-peer lending is rising fast as one of the hottest ways to earn passive income. Lending sites match lenders with borrowers so all you have to do is deposit what you want to loan. You can start by lending as little as $25 and lend up to tens of thousands of dollars if you want. Lending sites like Prosper can provide up to 5% yearly returns on loans (higher than most bank interest rates). While P2P lending has become much more secure as the space has grown, there’s always the possibility that someone could default on a loan, and your initial deposit could be at risk.
6. Join a crowd-funded real estate pool
You don’t have to buy a whole building or house these days to invest in real estate. Crowd-funded sites like RealtyMogul allow you to join investment pools with other investors. You choose the amount you want to invest, along with the residential or commercial property. Most sites offer anything from single-family homes to large-scale apartment buildings or office complexes. If you’re looking to dip your toes in real estate, crowd-funded opportunities are a good place to start.