The concept of making money while you’re asleep is powered by passive income. Passive income is like getting paid for something that you have already done. It could be writing a book, and then getting paid a commission (a percentage of the amount made through selling a product) for every sale for years to come, or even just buying some shares and getting dividends. Passive income is referring to making money without having to do anything, or only a little bit of work, after setting it up. People would talk about their passive income as being the total of all of the different streams of passive income.
Passive income is different from active income, which is where you have to do something to get your money. This may be an hourly wage for your work, being paid to do something specific on a contract, or doing piecework: being paid a certain amount for every x amount of tasks that you complete. If you would like to learn more about the different types of jobs and the different ways that you can be paid, click here.
For example, you may get $1,200 a year from all of the dividends from your shares, another $7,300 on top of that each year from one investment property, after subtracting all of the costs, and $5,750 per year from another property: which would leave you with a total passive income of $14,250 per year!
How could you start earning some Passive Income?
As I said before, a stream of passive income can be dividends from shares, because all you have to do is buy them in the first place. So, it could be an easy first stream of passive income for you to get, because although the passive income would not amount to much per share, most shares are pretty cheap, so if you want to earn more passive income, you could just buy some more shares.
Another way that you could make a passive income stream is by making an app and selling it for a couple of dollars. Even if you don’t know how to code that well at the moment, there are plenty of websites and YouTube videos that could teach you. After making the app, as long as it is something that people will be willing to pay for, you can make passive income over time by people buying it. Another way to make income off of an app is to have ads in it, you could probably make some money each time someone saw an ad on your app, and/or each time someone clicked on it.
If you are a young adult and have a bit more money to spend, another great way to make a new passive income stream is to get an investment property, as soon as you have purchased it and there is a tenant in it, you will be able to make money off of the rent that you receive. You may have to do a bit of work every now and again though, when you have to get new tenants after one moves out, or if something breaks in the property. If you would like to learn more about investment properties, click here.