7 Ways to Earn Passive Income

Kues / Shutterstock.com

It may sound like a fantasy to be able to earn money with little or no effort, but there are various ways to create passive income streams that can significantly boost your net worth over time.

Passive income is steady revenue that requires little or no effort to maintain. To get started, you may need to make a financial investment or put in some time. However, once the revenue stream is established, the profits can mount with little additional activity on your part. In some cases, you may be able to just sit back and watch the money come in.

What follows are several ways to earn passive income.

1. Become a landlord

renters
Monkey Business Images / Shutterstock.com

Many people earn passive income by renting out apartments, condos and houses. Of course you’ll need to acquire rental properties first. Be sure to set your rents high enough to provide a profit while covering your maintenance costs. As a landlord, you may need to clean your dwellings and make minor repairs between tenants. For many people, profits far outweigh the demands, however. Strive to find reliable tenants who pay their rent on time and do no damage.

If you want to make money part-time from your existing home, check out Airbnb, VRBO (Vacation Rental By Owner) and Homestay and read: “15 Steps to Profit By Renting Your Home to Visitors.”

2. Sell things you don’t need online

szefei / Shutterstock.com

Shopping can be fun, but many people find that they accumulate too many things over time. A good way to get rid of the clutter is to start selling unneeded books, artwork, sports equipment, toys and clothing online. Whatever it is you no longer need, there likely is someone who wants it. There’s a buyer for almost anything, if the price is right. The Internet provides an easy want to connect with shoppers.

Marketing websites like eBay, Gazelle and Craigslist make the process fairly simple. If you’re not sure what to sell, just look through the items stored in your garage, basement or attic. Instead of donating things to thrift stores, you could be making money by selling items over the Internet. To price your goods competitively, just look at what’s already for sale online.

3. Refinance your mortgage

Couple Getting Mortgage
bernatets photo / Shutterstock.com

If several years have gone by since you last obtained a home loan, consult a mortgage professional to find out if you can reduce your monthly loan payments by refinancing. For example, if your credit rating has improved since your last loan, you may qualify for a lower interest rate. If so, you may be able to lower your monthly payments or reduce the term of your loan. A shorter loan term could enable you to stop making mortgage payments sooner. That would free up your income for other uses or allow you to build up your savings. The home loan market is highly competitive, so be sure to shop around for the best lending terms.

Be sure to check out our mortgage search tool.

4. Take in a roommate

Nikodash / Shutterstock.com

If you have a spare room in your house or apartment, why not put it to use and rent out the space to a roommate? If you carefully screen applicants to find someone who is respectful of your home, this can be an easy way to bring in passive income. Be sure to set some ground rules for things like acceptable hours for watching TV, keeping the kitchen clean, and having guests over. And make sure you factor in added costs for utilities when you price your rent. Collecting the first and last month’s rent in advance will give you some added protection, in case your roommate is slow to pay. If you have valuable items in your home, request a damage deposit, just in case something goes wrong.

5. Switch to an online-only bank

online banking
Rawpixel.com / Shutterstock.com

If you can get used to idea of banking with an institution that’s only accessible online, you can earn greater returns on your savings with an online-only bank account. Unlike traditional brick-and-mortar banks, online-only banks have very low overheads. They don’t have to lease office space, and they can pass the savings on to their customers. Annual percentage yields on savings accounts and certificates of deposit typically are higher for online-only banks. That’s why they’re gaining popularity among people who want to get the most return on their savings. To get the best rates, check out several institutions before making a choice.

Check out: “How to Earn More on Your Savings for the Rest of 2018.”

6. Sell your unwanted stuff at flea markets

Joe Tabacca / Shutterstock.com

You can make extra money if you sell the things you no longer use at flea markets. Aside from displaying your items for potential buyers, this takes very little effort. Appliances in good working order, electronics, and antiques often sell well. All you’ll need, besides merchandise, is a display table and a portable chair to sit on. Before you make your debut as a seller, visit a flea market to learn the ropes. By carefully observing the sellers, you can learn how to price items so they are competitive. Some people actually make a living with this activity. Others find it to be an easy way to make extra cash.

If you are burdened with a lot of stuff, check out: “How to Get Rid of 6 Hard-to-Get-Rid-of Things.”

7. Invest in stocks that pay high dividends

online research
NicoElNino / Shutterstock.com

Savvy investors often buy stocks that pay high dividend yields. A dividend is a payment to shareholders. In theory, dividends reflect profitability. Dividend-paying stocks enable shareholders to make a profit when the company makes money. However, some troubled companies pay high dividends as a means of attracting new investors.

Companies that have unusually high dividends may be in financial trouble, so do your homework. There’s a possibility of experiencing losses if the dividend drops and the stock declines. Consider investing in companies that are part of stable, established industries.

What have you done to generate passive income? Share with us in comments below or on our Facebook page.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Read Next
17 Amazon Finds Under $20 That Will Organize Your Life
17 Amazon Finds Under $20 That Will Organize Your Life

We’ve rounded up must-have products to help you get your ducks in a row.

20 Great Part-Time Jobs for Retirees
20 Great Part-Time Jobs for Retirees

Maybe you’re not ready to leave the workplace entirely.

This Is the Best Used Car You Can Buy
This Is the Best Used Car You Can Buy

This car combines reliability, safety and long-lasting value.

How to Stop Living Paycheck to Paycheck in 8 Steps
How to Stop Living Paycheck to Paycheck in 8 Steps

Does it feel like your paycheck is gone the moment you get it? You can break that vicious cycle.

The 5 States With the Worst Health Care for Retirees
The 5 States With the Worst Health Care for Retirees

All of these states are located in the same region of the nation.

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Most Popular
9 Mistakes Everyone Makes When Shopping on Amazon
9 Mistakes Everyone Makes When Shopping on Amazon

Are you losing money due to any of these missteps?

7 Changes Coming to Social Security and Medicare in 2021
7 Changes Coming to Social Security and Medicare in 2021

Recently, both Social Security and Medicare made some major announcements about benefits for 2021.

Can a Divorced Widow Claim Her First Husband’s Social Security Benefits?
Can a Divorced Widow Claim Her First Husband’s Social Security Benefits?

The rules are complicated when it comes to eligibility for survivors benefits.

Can a Twice-Divorced Woman Claim Social Security Survivors Benefits?
Can a Twice-Divorced Woman Claim Social Security Survivors Benefits?

Understanding survivors benefits rules is the key to getting the most from your benefit.

These Are the 10 Worst Cars for Depreciation
These Are the 10 Worst Cars for Depreciation

Two types of vehicles are especially likely to see steep plunges in value.

9 Things You’ll Never See at Costco Again
9 Things You’ll Never See at Costco Again

The warehouse store offers an enormous selection, but these products aren’t coming back.

10 Things I Always Buy at Trader Joe’s
10 Things I Always Buy at Trader Joe’s

From snacks to sweets to side dishes, stock your cart with these time-tested favorites on your next TJ’s run.

Longer Trips to This Type of Store May Raise Coronavirus Risk
Longer Trips to This Type of Store May Raise Coronavirus Risk

An airborne-disease expert recommends exiting these stores within 30 minutes.

5 Ways Social Security Will Change in 2021
5 Ways Social Security Will Change in 2021

These adjustments will affect both workers and retirees in the new year.

11 ‘Disposable’ Items You Should Be Reusing
8 Things You Should Buy at Restaurant Supply Stores
8 Things You Should Buy at Restaurant Supply Stores

You don’t have to be a chef or a restaurant owner to shop here.

3 Ways to Get Microsoft Office for Free
3 Ways to Get Microsoft Office for Free

With a little ingenuity, you can cut Office costs to zero.

19 High-Paying Jobs You Can Get With a 2-Year Degree
19 High-Paying Jobs You Can Get With a 2-Year Degree

There are easy high-paying majors available in the U.S. — and no bachelor’s degree is required. We’re here to help you find easy degrees that pay well.

Stop Buying These 19 Things Online
Stop Buying These 19 Things Online

The internet has changed how we shop. But for some things, you’re still better off buying the old-fashioned way.

Cut These 11 Expenses Now If You Hope to Retire Early
Cut These 11 Expenses Now If You Hope to Retire Early

Like the idea of financial independence? Part of the FIRE equation is cutting costs.

27 Things You Should Never Pay For — and How to Get Them for Free
27 Things You Should Never Pay For — and How to Get Them for Free

When you know the tricks, you can save big on all kinds of useful things that others pay for.

4 Tax Credits That Will Be More Generous in 2021
4 Tax Credits That Will Be More Generous in 2021

If you are eligible for these tax breaks, they will slash your federal income tax bill — dollar for dollar.

7 Tips for Building an Emergency Food Supply
7 Tips for Building an Emergency Food Supply

A pandemic or natural disaster could leave you reliant on your existing emergency food supply. Is your pantry well-prepared for emergencies? Knowing what to stock up on for emergencies can be a difficult task and we’re here to help.

15 Things You Can Get for Free in December
15 Things You Can Get for Free in December

December is here, which means it’s your last chance to take advantage of fabulous freebies in 2020.

View More Articles

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.