11 Passive Income Ideas: How to Make Money While You Sleep

Looking for passive income ideas that will help you create your dream life? Passive income helps you build a life with flexibility, freedom, and a healthy dose of extra cash.

And that’s exactly why we created this list of passive income ideas to help you make money around the clock with little to no effort past the initial setup. Everyone deserves to build financial wealth, and it’s never too late to start.

11 Passive Income Ideas Anyone Can Do

“If you don’t find a way to make money while you sleep, you will work until you die.” – Warren Buffett

While those words are seriously ominous and more than a little depressing, he’s not wrong — or at least not far off when you think about it.

While the definition of passive income is any money you earn regularly with little to no effort required to maintain, it’s not a get-rich-quick scheme. Everyone would have Warren Buffett-level wealth if it were instant — or easy. But if you’re ready to do the work, you can create more wealth through a variety of passive income streams.

Below, we look at the top passive income ideas anyone can do — at any age — to make more money.

1. Invest in a Rental Property

Investing in rental properties is a popular way to generate passive income. By owning rental properties, you can earn a steady stream of monthly income through rent payments. However, it’s important to consider the advantages and disadvantages before jumping in.

Advantages:

• Steady income: One of the biggest advantages of rental properties is its steady income stream. As long as your tenants are paying their rent, you’ll have a consistent source of income.
• Appreciation: Rental properties can appreciate over time, which can lead to long-term wealth building.
• Tax benefits: Owning rental properties can provide tax benefits such as deductions for mortgage interest, property taxes, and depreciation.

Disadvantages:

• Upfront costs: Purchasing a rental property can require a significant upfront investment. You’ll need to have enough money for a down payment, closing costs, and any repairs or renovations. Most property investors need a 15–25% down payment, but it can be lower for some, according to Investopedia.
• Property management: Being a landlord can be time-consuming, especially if you have to deal with repairs, maintenance, and tenant issues. If you hire a management company, you’ll pay an average of 8%–12% of the average monthly value.
• Market fluctuations: The rental market can be unpredictable, and changes in the economy or local housing market can impact your rental income.

How to Get Started:

• Research the market: Before investing in a rental property, research the local real estate market to find properties likely to appreciate in value and generate strong rental income.
• Secure financing: If you don’t have enough cash to purchase a rental property outright, you’ll need to secure financing through a bank or other lending institution.
• Find the right property: Look for properties that are in desirable locations and have features that tenants are looking for such as updated kitchens and bathrooms.

Tips for Success:

• Set realistic rent prices: Research the local rental market to determine the going rate for similar properties, and set your rent prices accordingly.
• Screen tenants carefully: To avoid problems down the road, be sure to thoroughly screen tenants by conducting background checks and verifying employment and income.
• Stay on top of maintenance: Regular maintenance and repairs can help prevent bigger problems down the road, and keep your tenants happy.

2. Invest in Stocks With Dividends

When a company earns a profit, it can choose to reinvest that money back into the business or distribute it to shareholders in the form of dividends. Dividend stocks are stocks that pay out a portion of their profits to shareholders in the form of regular dividend payments. Dividend stocks are often seen as a more stable and reliable investment option, as companies that pay dividends are generally well-established and financially stable.

Keep in mind that you’d have to have a significant amount of money invested to see a significant return in dividends. But even $15 here and there isn’t something to shake a stick at. In fact, it’s a coffee and a muffin at Starbucks.

Advantages:

• Steady income: Dividend stocks provide a regular stream of passive income through dividend payments.
• Potential for growth: Dividend stocks can provide both income and growth potential, as companies that pay dividends are often financially stable and poised for growth.
• Tax benefits: Dividend income is generally taxed at a lower rate than other types of investment income.

Disadvantages:

• Fluctuating dividends: Dividend payments can fluctuate depending on the company’s financial performance, which means they’re not guaranteed.
• Market fluctuations: The value of dividend stocks can be impacted by changes in the stock market and economy, so there is some level of risk involved.
• Limited upside potential: Dividend stocks may not provide the same level of growth potential as other types of investments, as companies that pay dividends may choose to reinvest profits back into the business instead of paying out dividends.

How to Get Started:

• Research potential stocks: Look for companies with a history of consistent dividend payments and strong financials, like Pioneer Natural Resources (PXD), which pays 13.5%, and Devon Energy (DVN), which pays 6.7%.
• Open a brokerage account: You’ll need a brokerage account to buy and sell dividend stocks.
• Invest wisely: Diversify your portfolio to minimize risk, and don’t invest more than you can afford to lose.

Tips for Success:

• Look for stable companies: Focus on companies with a strong financial history and a history of consistent dividend payments.
• Reinvest dividends: Consider reinvesting dividend payments to maximize the long-term growth potential of your investment.
• Stay up-to-date on market trends: Keep an eye on market trends and company news to stay informed and make informed investment decisions.

3. Create and Sell Online Courses

This is one of the passive income ideas anyone can do — although it might not seem that way at first. This idea involves creating a course on a specific topic, recording video lessons, and packaging them in a way that’s easy for students to learn. These courses can be sold on platforms like Udemy, Skillshare, or your own website. Online courses can cover a wide range of topics, from business and marketing to cooking and fitness, which is why anyone can do it. Choose what you’re good at and share your gift with the world.

Advantages:

• High demand: Online education is growing in popularity, which means there is a high demand for quality online courses.
• Low overhead: Creating and selling online courses requires little to no overhead costs, making it a low-risk investment.
• Passive income potential: Once your course is created, it can continue generating income for months or even years. However, depending on how well you market your course and if you already have an optimized website with a following, you could make anywhere from $0–$50,000+ per month. On average, most creators make $1–$5k per month.

Disadvantages:

• Competition: The market for online courses is highly competitive, so it can be challenging to stand out and attract students.
• Time investment: Creating a high-quality online course requires a significant time investment upfront, including researching, planning, recording, and editing.
• Technical skills: Creating an online course requires some technical skills, such as video editing and online platform management.

How to Get Started:

• Choose a topic: Choose a topic you’re knowledgeable and passionate about, with a high demand in the market.
• Plan your course: Create an outline of your course, including the topics you will cover and the format you will use.
• Create your course content: Record video lessons, create supplemental materials, and package everything together into a cohesive course.
• Launch your course: Choose an online platform to host and sell your course, and launch it to the world.

Tips for Success:

• Focus on quality: Create a high-quality course that provides real value to students and stands out in the market.
• Promote your course: Use social media, email marketing, and other channels to promote your course and attract students.
• Engage with students: Engage with your students through discussion forums, Q&A sessions, and other channels to build a community and increase retention rates.

4. Try Affiliate Marketing

Affiliate marketing involves partnering with a company to promote their products or services to your audience. You’ll receive a unique affiliate link that you can share with your followers through your blog, social media, or email marketing. When someone clicks on your affiliate link and makes a purchase, you earn a commission on that sale.

Advantages:

• Low overhead: Affiliate marketing requires little to no overhead costs, making it a low-risk investment.
• Passive income potential: Once you’ve set up your affiliate links, you can earn commissions on sales that are made for months or even years to come. Beginners make an average of $0-$1,000 per month, according to Authority Hacker.
• Flexibility: Affiliate marketing can be done from anywhere with an internet connection, making it a flexible source of income.

Disadvantages:

• Competition: Affiliate marketing is a popular way to generate passive income, which means there is a lot of competition in the market.
• Reliance on affiliate programs: Your success with affiliate marketing is reliant on the success of the companies and products that you promote.
• Limited control: As an affiliate marketer, you have limited control over the product or service you are promoting and the sales process.

How to Get Started:

• Choose a niche: Select a niche you’re passionate about with a large and engaged audience.
• Find affiliate programs: Research affiliate programs in your niche and select ones that align with your values and audience.
• Promote your affiliate links: Share your affiliate links with your audience through your blog, social media, or email marketing.

Tips for Success:

• Build trust with your audience: Only promote products and services that you truly believe in and that align with your values.
• Be transparent: Clearly disclose your affiliate links to your audience, and be transparent about the commission you earn from sales.
• Provide value: Provide valuable content to your audience, and only promote products and services that will benefit them.

5. Open a High-Yield Savings Account

If you’re looking for no-brainer passive income ideas, this is it! A high-yield savings account is a type of savings account that offers a higher interest rate than a traditional savings account (suck it, Wells Fargo!). The interest rates for high-yield savings accounts are typically higher than those for traditional savings accounts because online banks or credit unions offer lower overhead costs.

Advantages:

• Higher interest rates: High-yield savings accounts offer higher interest rates than traditional savings accounts, which means you can earn more money on your savings. At the time of publishing, Capital One’s high-yield savings account offers a 3.50% APY with no account minimum or fees, and CitiBank offers a 3.85% APY but does have some small fees if you don’t keep an average monthly balance of $500.
• Low risk: High-yield savings accounts are FDIC-insured, which means your money is protected up to $250,000 in case the bank fails.
• Flexibility: High-yield savings accounts offer the same flexibility as traditional savings accounts, including the ability to make withdrawals and deposits as needed.

Disadvantages:

• Limited access to funds: Some high-yield savings accounts may have restrictions on how often you can make withdrawals or transfers, while others have none. Look into these restrictions before committing.
• Inflation risk: The interest rates for high-yield savings accounts may not keep up with inflation, which means your savings may lose value over time.
• Limited account features: High-yield savings accounts may not offer the same features as traditional savings accounts, such as check-writing capabilities.

How to Get Started:

• Research options: Research online banks or credit unions that offer high-yield savings accounts and compare interest rates, fees, and account features.
• Open an account: Once you’ve found a high-yield savings account that meets your needs, open an account online or in person.
• Fund your account: Transfer funds from your current savings account or checking account to your new high-yield savings account.

Tips for Success:

• Set up automatic transfers: Set up automatic transfers from your checking account to your high-yield savings account each month to make saving easier.
• Monitor interest rates: Keep an eye on the interest rate for your high-yield savings account and consider switching to a different account if a higher rate becomes available.
• Keep an emergency fund: Use your high-yield savings account to build an emergency fund to cover unexpected expenses or income loss.

6. Share Your Car

Renting out your car is one of the newer passive income ideas, but it shouldn’t be overlooked. With car-sharing platforms like Turo and Getaround, you can rent out your car to people who need a vehicle for a short period of time. Here’s what you need to know about renting your car:

Advantages:

• Passive income: Renting out your car can provide a steady stream of passive income without requiring much effort on your part. On the car-sharing platform Avail, users make an average of $300 per month+.
• Low risk: Car-sharing platforms typically provide insurance coverage for the rental period, which means your car is protected against damage or theft.
• Increased utilization: If you don’t use your car often or work from home, renting it out can increase its utilization and help you get more value from your investment.

Disadvantages:

• Wear and tear: Renting out your car can result in increased wear and tear, which may require more frequent maintenance and repairs.
• Insurance requirements: Some car-sharing platforms may require you to have certain types of insurance coverage, which can be costly.
• Limited availability: Depending on where you live, there may be limited demand for car rentals, which means your car may sit idle for long periods of time.

How to Get Started:

• Choose a car-sharing platform: Research car-sharing platforms like Turo or Getaround and choose one that works best for you.
• List your car: Create a listing for your car on the car-sharing platform, including photos, pricing, and availability.
• Screen renters: Review rental requests and screen renters carefully to ensure they meet your requirements.

Tips for Success:

• Set competitive pricing: Research the local market to set competitive pricing for your car rental.
• Keep your car clean and well-maintained: Renters are more likely to choose a clean, well-maintained car, so be sure to keep your car in good condition.
• Be responsive: Respond to rental requests and questions quickly to provide a positive renting experience for renters.

7. Self-Publish a Book

Self-publishing a book is a way to generate passive income by selling your own written work directly to readers. With the rise of digital publishing platforms like Amazon Kindle Direct Publishing and Barnes & Noble Press, self-publishing has become an accessible and popular option for authors. Here’s what you need to know about self-publishing:

Advantages:

• Higher royalties: Self-published authors can earn higher royalties on book sales than traditionally published authors.
• Control: Self-publishing allows you to retain more control over your book, including the cover design, pricing, and distribution.
• Passive income potential: Once your book is published, it can continue to generate income for years or even decades.

Disadvantages:

• Marketing: Self-publishing requires you to handle all aspects of marketing and promotion, which can be time-consuming and challenging.
• Quality control: Without the help of a traditional publisher, you are solely responsible for ensuring the quality of your book, including editing, formatting, and cover design.
• Limited distribution: Self-published books may have limited distribution channels compared to traditionally published books.

How to Get Started:

• Write your book: Start by writing your book and editing it thoroughly to ensure it is high-quality and well-written.
• Create a cover design: Create a cover design for your book that is eye-catching and professional. Use a Fiverr designer if you need help — they’re often the most affordable.
• Format your book: Format your book for digital publication using a platform like Amazon Kindle Direct Publishing or Barnes & Noble Press.
• Publish your book: Publish your book on the chosen platform and set a price for it.

Tips for Success:

• Hire an editor: Consider hiring an editor to ensure your book is free of errors and is as high quality as possible.
• Invest in marketing: Set aside a budget for marketing and promotion, including advertising and social media outreach.
• Build an email list: Build an email list of potential readers and use it to promote your book and generate sales.

8. Advertise on Your Car

If you’re looking for creative passive income ideas, you’ve found it! Advertising on your car involves placing a decal or wrap to promote a company’s product or service. The advertising company pays you a monthly fee for using your vehicle as a moving billboard.

Advantages:

• Passive income: Advertising on your car provides a steady stream of passive income without requiring much effort on your part.
• No upfront costs: Most companies that advertise on cars provide the decals or wraps for free, which means you don’t have to pay anything upfront.
• Flexibility: You can choose to advertise on your car for as long or as little as you like, making it a flexible source of income.

Disadvantages:

• Wear and tear: Advertising on your car can result in increased wear and tear, which may require more frequent maintenance and repairs.
• Limited availability: There may be limited opportunities for advertising on your car, depending on where you live and the companies that are interested in your vehicle.
• Aesthetics: Some people may not like the look of advertising on their car and may prefer to keep their vehicle free of decals or wraps.

How to Get Started:

• Research companies: Research companies that offer advertising on cars and find one that works best for you. Here’s a list. of some common options: Wrapify, Carvertise, StickerRide, Stickr, and Nickelytics.
• Apply: Apply to the advertising company and provide information about your vehicle, driving habits, and demographic information.
• Get approved: Once you are approved, the advertising company will send you a decal or wrap to install on your car.

Tips for Success:

• Drive often: The more you drive your car, the more exposure the advertising will receive, which can increase your income.
• Keep your car clean: Keep your car clean and well-maintained to ensure that the advertising looks its best.
• Be aware of restrictions: Some companies may have restrictions on where you can drive or park your car while advertising is on it, so be sure to read the fine print.

Overall, advertising on your car can be a simple and easy way to earn passive income without taking on too much risk. By researching opportunities, applying to advertising companies, and following best practices, you can earn passive income while driving your car.

9. Create a Blog

Creating a blog involves publishing useful or entertaining content to your target audience. While this is one of the passive income ideas that does require ongoing work, once you’ve built up a following, you can monetize your blog through advertising, affiliate marketing, and product sales.

Advantages:

• Low startup costs: Starting a blog requires minimal investment, which makes it a low-risk way to generate passive income.
• Flexibility: You can create a blog on any topic that you are passionate about, giving you the flexibility to pursue your interests and expertise.
• Passive income potential: Once you’ve built up a following, you can monetize your blog through advertising, affiliate marketing, and product sales, providing a steady stream of passive income.

Disadvantages:

• Time-consuming: Blogging requires a significant amount of time and effort to create high-quality content, build an audience, and monetize your blog. It’ll take some time until you can get to the point of passive income.
• Competition: There is a lot of competition in the blogging space, which means it can be challenging to stand out and attract a following.
• Uncertainty: Blogging income can be unpredictable and can fluctuate based on traffic and monetization methods.

How to Get Started:

• Choose a niche: Choose a topic or niche that you are passionate about that has a large and engaged audience.
• Set up a blog: Set up a blog using a platform like WordPress or Squarespace and choose a domain name that is relevant to your niche.
• Create content: Create high-quality content that is useful or entertaining to your target audience and promotes engagement.
• Monetize your blog: Once you’ve built up a following, monetize your blog through advertising, affiliate marketing, and product sales.

Tips for Success:

• Create high-quality content: Create well-written, informative, and engaging content to keep your audience coming back for more.
• Promote your blog: Use social media, guest blogging, and other methods to promote your blog and attract new readers.
• Be patient: Building a successful blog takes time and effort, so be patient and persistent in your efforts.

10. Invest in Real Estate Investment Trusts (REIT)

REITs are companies that own or finance income-generating real estate properties, such as apartments, shopping centers, and office buildings. Investors can purchase REIT shares, which provide them with a portion of the property’s income.

Advantages:

• Passive income: REITs provide investors with a way to earn passive income through dividends. The average dividend yield for REITs is 4.3%.
• Diversification: Investing in REITs allows investors to diversify their portfolios and reduce risk.
• Accessibility: REITs are publicly traded, which makes them accessible to individual investors.

Disadvantages:

• Market fluctuations: The value of REIT shares can be affected by market fluctuations, which means the value of your investment can fluctuate.
• Interest rate risk: REITs can be sensitive to changes in interest rates, which can affect the dividends paid to investors.
• Management risk: The performance of REITs can be affected by the quality of the management team and their decisions regarding property investments.

How to Get Started:

• Research REITs: Research different REITs and find one that aligns with your investment goals and preferences.
• Open a brokerage account: Open a brokerage account to purchase shares of the REIT.
• Purchase shares: Purchase shares of the REIT and monitor its performance.

Tips for Success:

• Research the management team: Research the management team of the REIT and ensure they have a strong track record of successful property investments.
• Diversify: Diversify your REIT investments by investing in multiple REITs and/or different types of properties.
• Monitor performance: Monitor the performance of the REIT and adjust your investment strategy as needed.

11. Open a Print-on-Demand E-Commerce Store

If you’re a creative person and/or you have some graphic design skills, this just might be the best passive income idea for you! A print-on-demand store is an online store that allows customers to select a product and a design and then have the design printed on the product and shipped to them. The store owner doesn’t have to keep inventory or invest in equipment, making this a fun passive income source after the initial setup.

Advantages:

• Low startup costs: Starting a print-on-demand store requires minimal investment, which makes it a low-risk way to generate passive income.
• Customization: Customers can customize products with their own designs or choose from a selection of designs you provide, making it a unique and personalized shopping experience.
• Passive income potential: Once your store is set up, it can continue to generate income without much effort on your part.

Disadvantages:

• Competition: There is a lot of competition in the print-on-demand space, which means it can be challenging to stand out and attract customers. You will want to create social media accounts for your online store to help promote it and run paid ads for the best results.
• Quality control: The quality of the products and the printing can be variable, which can affect customer satisfaction and reviews. You’ll want to get samples of the products to ensure they’re high quality.
• Limited profit margins: The profit margins on print-on-demand products can be low, especially if you’re competing on price.

How to Get Started:

• Choose a platform: Choose a print-on-demand platform like Printful, Gooten, or Printify.
• Set up your store: Set up an online store using a platform like Shopify or WooCommerce and integrate it with the print-on-demand platform.
• Create designs: This is where wit, humor, and creativity come in handy. Create or source designs for your products using tools like Canva or hiring a graphic designer.
• Launch your store: Launch your store and start promoting it through social media, advertising, and other marketing channels.

Tips for Success:

• Focus on quality: Choose high-quality products and ensure that the printing and design are of high quality to ensure customer satisfaction.
• Build a brand: Build a strong brand and unique designs to stand out in a competitive market.
• Price competitively: Research pricing for similar products and price your products competitively to attract customers.

Get That Money

Which of these passive income ideas will you try? We hope these passive income streams have inspired you to create your own.

Whether you choose one or a combination, passive income enables you to build wealth and achieve financial freedom. So try out these passive income ideas to see what works for you — who knows, you just might become the next Warren Buffett. Just don’t forget to share the wealth with those who helped you along the way (ahem — us!). Good luck!

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