9 Great Ways to Make Passive Income Without Investing in Real Estate
Want to make some extra money without having to invest in real estate? You’re not alone. Passive income streams are becoming increasingly popular as more and more people look for ways to create financial independence.
In this post, we'll walk you through nine great ideas for generating a steady flow of passive income ideas without investing in expensive rental properties or apartments.
This can be especially beneficial if you're looking to build up an emergency fund, pay off existing debts faster, or simply supplement your current regular income stream.
So keep reading - we've got the low-down on all the best passive income ideas that don't involve buying physical property.
What are passive income ideas?
Creating streams of income can be a surefire way to achieve financial success. Passive income is a type of revenue stream that you generate with little to no effort.
Although having said that - it usually entails some hefty legwork to get started!
It’s called passive because you don’t need to actively work on the activity itself to start earning money.
This income is usually generated from investments, such as stocks, real estate rentals, royalties from writing books, music and other activities.
It often requires upfront investment but can eventually generate recurring cash flow for the investor.
Ie: if you buy stock in a company that increases in value over time due to favourable market conditions, the dividends and capital gains you receive from this investment can be viewed as passive income stream sources.
How to generate multiple streams of income?
If you're eager to diversify your revenue, here are a few ways to make multiple streams of income.
1. Invest in dividend stocks
If you're looking for some ways to earn passive income, investing in dividend stocks (or shares) is a great option.
Not only can dividends provide a steady stream of income, but the stock market is also often very volatile, which can mean good returns on investment over time if you know what to look for.
Dividend stocks typically pay out quarterly rather than monthly, and it’s important to research before investing in any specific company.
Knowing your way around the stock (share) market wouldn’t hurt, either.
Ultimately, opening up an online trading account and buying solid dividend-paying stocks that appreciate can be rewarding and profitable.
In my case, I use Stake Black to invest in stocks and ETFs (Exchange Traded Funds) and absolutely love it.
I also recommend using Google Finance. It’s free and incredibly helpful when you can see the big picture view of stocks and ETFs.
You can also keep track of your Top Movers, Favourites or ETFs using lists.
2. Create a blog or website and make money from ads and referrals
Another great idea is to create a blog or website on a topic you're passionate about. This can be an amazing source of joy and connection while helping your finances.
On that note, here is a great Twitter thread on how to find your niche:
Matt nails it in that thread but to summarise:
- What are you already awesome at?
- What can you talk about for hours?
- What do friends think you’re good at?
- What problem do you need to solve?
- What’s meaningful but underrated?
This way, you can build consistent revenue through ads and affiliate links without having to worry about the day-to-day hassles of running a business.
Best of all, this system allows you to monetise your passions and hobbies, giving you an outlet that also helps your wallet.
With a laptop and some know-how, you could turn your favourite things into an extra reliable income source.
A product review website is another idea. Have a look at PrudentReviews.com or BikeLockWiki to see how simple (but effective) they are.
To take advantage of some of the passive income ideas out there you’ll need to put serious time and energy into your blog and content creation. (As well as tap into your imagination and drive!)
3. Start an online store selling digital products such as e-books, courses, etc
An excellent way to get your business up and running is by launching an online store specialising in digital products, such as e-books or courses.
Selling digital products such as e-books, courses, and other content can be highly lucrative. Plus, you never have to worry about stocking physical inventory or shipping items.
With the right marketing strategy and SEO (search engine optimisation), you can get a steady stream of customers without too much effort.
Here’s a few online store builders I recommend.
Or go look at...
- WP eStore ($49 WordPress plugin)
- ThriveCart (one time fee)
- ConvertKit page builder (free to start)
You don’t really need to use GumRoad. Just saying.
4. Invest in peer-to-peer lending platforms
When investing in a passive income strategy, peer-to-peer lending platforms can be a great option.
Basically, what happens is you provide funds to individuals who are looking for loans. You can choose which borrowers to lend money to, and since the process is automated, it's easy and stress-free.
Plus, you'll receive interest payments from your investments, making it a perfect passive income option.
Not only that but investing in these lending platforms can provide good returns if done wisely.
Note: I’ve never personally done this sort of thing. I have, however, seen quick loans (up to $5000) available at ‘Cash Converter’ shops and the interest rate made me run for the hills!
If you can get your ducks in a row on this one then the returns could be worthwhile.
5. Teach online courses
Teaching online courses can be another excellent way to earn a passive income.
It is an incredibly flexible way to gain an income stream without incurring the overhead costs associated with setting up a traditional course.
You can teach courses related to any topic you’re passionate about and market it to the right audience.
Plus, platforms like Skillshare, Teachable, or Udemy have all the structure in place, as well as the audience (eyeballs).
You bring your skillset, knowledge and materials. This might involve creating a series of videos on a subject you're knowledgable about.
I’d love to teach online courses myself. (Maybe one day!)
If you’re keen, have a look at Anik Singal’s Lurn.com. It’s a great place for learning with both free and paid courses available.
Online courses are far-reaching, so you can teach people from all over the world! Not only that, but as long as you have the materials ready, it takes very little effort to keep earning every month.
6. Sell handmade goods (or physical books / guides) through websites or social media
Selling goods online is a great way to make extra income. Whether selling handmade goods you make yourself, or physical books and guides, setting up an online shop is easier than ever.
Hundreds of websites and platforms such as Etsy, Amazon KDP, or Redbubble allow small-scale businesses to reach their customers quickly and efficiently.
Some of these platforms (like Amazon KDP or Merch) will print, promote and publish your books and products for you too.
Social media is another great tool for entrepreneurs; with platforms like Instagram and Facebook, it's possible to see your products worldwide with just a few clicks.
Not only can this create additional income, but it can also be incredibly rewarding.
I’ve put some wacky late nights into creating a few Amazon KDP books (mainly focused on low content books so far).
The Amazon audience is massive and they’ll buy your books like there’s no tomorrow, when you get all the pieces of the pie right.
Where did my inspiration for doing Amazon KDP come from? I'm glad you asked...
- A masterclass called ‘Write & Publish Kindle Books’ on Udemy
- Everything Rebecca Holman puts out (including her great Facebook page)
- Search Youtube for Paddy at StackinProfit and TheHomeBoss
I’ve also dabbled in Amazon Merch with my random t-shirt designs and sold the odd one now and then. It can drive you crazy if you let it!
7. Sell stock photos online
Selling stock photos online is a (somewhat) easy way to create passive income.
All you need is a good camera (and an abundance of free time!) to take beautiful, high-quality pictures.
It also helps to study what people want, have a good eye for images, and know your way around Photoshop or Affinity Photo!
Once your photos are taken and uploaded on platforms such as Shutterstock or Adobe Stock, they'll start collecting royalties every time they're purchased.
With something like 1000+ photos on Alamy, it’s always nice to make sales.
But... stock photography earnings are random. Sadly, there’s no clockwork monthly income guarantees for this one.
You need to put a lot of TIME into the photo shoots, photo editing, image keywording, buying the drone, getting the right lens etc.
But... there is a silver lining!
People buy images. And the images that sell the most are nearly always the images you think will never sell! (I don't understand it either!)
Selling stock photos is an excellent option for any creative aspiring entrepreneur who lacks the funds for more expensive side hustles (or just loves taking photos like me!)
8. Start a purposeful YouTube channel
Starting a YouTube channel can be another approach.
Not only can you make money through monetising your videos, but it also offers you a creative platform to showcase your passions or hobbies. (Or a weird sense of humour perhaps?!)
Among a million peeps doing Youtube, a few greats stand out..
For passive income reviews, sales funnel advice & more - then look no further than the Buildapreneur YouTube channel.
Spencer Mecham (who runs it) is pretty open and honest about things. He has a great blog too that's helpful to entrepreneurs of all levels.
On a similar note you might want to peruse Miles Beckler’s 300+ videos too. If you’re ready to deep dive into this stuff then Miles is the man.
Of course, it won't happen overnight (like all passive income ideas), so you'll need to be patient and consistent to see success.
Miles punched out something like 100+ Youtube videos before he saw traction!
I’m sure you can achieve financial freedom through being an influencer or content creator on YouTube now more than ever before!
9. Sell your designs online
Another income idea is to start selling designs online.
Outsource to a designer (or do it yourself) and create useful logos, book covers, graphics, illustrations (etc) and other visuals and printables.
They can also be used as stock images and listed on different websites.
With the right keywords and strategy, you can turn this into a lucrative side hustle that won't require much effort after the initial setup.
To get an idea of this have a look at:
Who knows, maybe you'll even stumble across a niche that nobody has thought of yet!
Or you just become so good at it that everyone keeps buying your stuff!
What passive income is not
1. Your job
Contrary to popular belief, passive income isn't just your job.
While it's true that earning a steady income from your place of employment might make it easier to achieve financial freedom, there are other ways you can earn money without having to work a 9-5 job.
Things like real estate investment and online businesses (aka websites) can bring in a steady stream of cash on autopilot, giving you more control over the money you make and how you spend it.
So, don't think passive income is out of reach; with creative thinking and strategic investments, financial freedom can be yours.
Bob Proctor calls it MSI or Multiple Streams of Income.
In the diagram above you’ll see that the inner circle is your primary source of income.
Surrounding that are the golden “opportunity boxes” where you get to choose what MSI or ‘passive income streams’ you want to have.
I’ve made a free MSI PDF of the above diagram you can download in our printable guides page.
It's infinite how many income streams you can have, right?
For me, it might look like this:
- MSI #1 - Alamy Stock photo sales
- MSI #2 - Amazon KDP
- MSI #3 - Amazon Merch (t-shirts, phone covers etc)
- MSI #4 - Website / affiliate earnings
On and up it goes!
2. A second job
If you're looking to make some extra money without having to take on a second job, passive income might be the route to success.
Contrary to popular belief, passive income isn't just another term for a second job but involves making money without having to work tirelessly in one specific field or be tied down by one employer.
Here’s how Bob Proctor describes it:
“Multiple Sources of Income (MSI) is a technology which will permit you to multiply your present income by providing service beyond that which you are presently providing at your primary source of income. ADDITIONAL SERVICE - ADDITIONAL INCOME.”
Whether it's through investments, renting out a property, or monetising your online content, there are plenty of options available for those looking to become their boss and take control of their finances.
Passive income provides an opportunity to generate consistent income with no cap on earnings - so don't limit yourself.
“An MSI is an idea which enables you to provide service to humanity in a lawful manner for which you will be fairly compensated. The compensation you receive from each MSI could be minimal or it could be millions of dollars per year.”
3. Non-income-producing assets
Passive income might sound like a dream come true – no need to work, and money just magically appears in your bank account.
Unfortunately, this is not the case, and it's important to understand that passive income does not mean no-work income.
A passive income involves owning an asset or a portfolio of assets that generate small amounts of steady income without requiring daily effort or labour.
This could be investments such as stocks, bonds, mutual funds, real estate, index funds, and more.
These are all examples of non-income-producing assets that can help you build your wealth with minimal effort in the long term.
So while passive income isn't what many assume it to be, if managed properly, it can produce financial freedom and security.
What are the benefits of passive income?
1. Make money while you sleep
One of the best things about passive income is that you can make money even while you sleep.
This is because passive income is typically generated from sources that do not require your active involvement, such as rental properties or dividend-paying stocks.
As long as you own these assets, you will continue to earn money from them, even if you are not actively working.
2. Achieve financial independence
Another great benefit of passive income is that it can help you to achieve financial independence.
Financial independence means having enough passive income to cover your living expenses without working a traditional job.
This gives you the freedom to live the life you want without having to worry about money.
3. Diversify your income streams
Another benefit of passive income is that it allows you to diversify your income streams.
This is important because it helps to protect you from economic downturns.
When you have multiple sources of passive income, if one source dries up, you will still have others that can help to keep you afloat
4. Free up your time
A final benefit of passive income is that it can free up your time.
This is because, as mentioned above, passive income typically does not require your active involvement.
This means that you can use your time for other things, such as pursuing hobbies, flying drones (like me!) or spending time with family and friends.
If you’re looking for ways to make some extra money without investing in real estate, as you can see, there are plenty of options out there.
From starting a blog or website to becoming a Youtube channel owner, there are many ways to make passive income without breaking the bank.
Maybe the key is to TAKE IMPERFECT ACTION.
Claim that imperfect action as YOUR experience.
Your current level of growth is all that is necessary.
Yes, one day you’ll live off of your passive income streams full-time.
“If a person advances confidently in the direction of their dream and endeavours to live the life they have imagined, they will meet with success unexpected in common hours.”