If you want to reach economic independence but were not born a tycoon, nor a world-class footballer or a star, you require to know the best way for Passive Income.
Note that most utmost individuals only take active income.
1. They are employed 40 hours a week in exchange for a salary. In other terms, they trade their freedom for money until they leave.
2. They have their own business. In this case, they bill according to the number of clients they get, so they are also trading their time for money in practice. And they usually serve more than 40 hours.
Fortunately, there is another increasingly popular way of life. A method in which you do not have to sell your time because you create an asset that works for you and generates money on automatic pilot.
What is passive income?
Before we get down to business, let’s agree on what we mean by passive income.
Passive income is those that are generated automatically without involving an additional investment in time or money.
Once you have begun them, they proceed to give you cash without giving more means to them. This way, you earn income while doing other things: work, travel, or even sleep.
Types of income
Knowing the three types of income that exist will allow you to assess the advantages of liabilities.
- Income for time: where you trade your time for cash. This type of job people has where they give you a salary of X money a month. The problem is that this dramatically reduces your ability to generate income since you are limited by your time.
- Income by the result: they do not depend directly on time spent but on the results achieved. Many self-employment or commercial jobs are like this: If you have a cloth store, you will get more money based on the quantity of cloth you trade, despite of how long it took you to do so.
- Passive income: they can depend on the results, but they do not require you to dedicate more time or effort to continue generating money. They do it on autopilot.
Here are the best formulas to generate passive income
1. Affiliate Marketing
Earning potential: High.
Required investment: Low-Medium. Low if you spend your time creating content and getting links (you will only have to buy the domain and hire a hosting), and a half if you hire editors or buy links.
Difficulty: Medium, but growing. More competition.
HOW DOES AFFILIATE MARKETING WORK?
With affiliate marketing, firms give you per purchase that you connect to them within your website.
The most common strategy is to create a website where you publish analyses and recommendations of a product type. The seller will give you a commission for every customer that you give them through your links.
2. Sell passive courses or services on a blog.
Earning potential: Very high. I am not one of the bloggers who earn the most, far from it, yet I still make between 3,000 and 4,000 euros per month.
Investment required: Low. Only the expenses associated with a blog (domain + hosting) and creating your course or service.
Difficulty: Medium. To make money with a blog, you need to offer value, solve your readers’ needs, and master some marketing tools.
3. Create a YouTube channel
Income potential: Very variable. If you want to make money, you will have to constantly upload videos (which makes it not so passive).
Investment required: Low. Just the cost of recording and editing your videos.
Difficulty: Medium. There is also more audience, and although there is more competition.
Building a YouTube channel and advertising your videos will enable you to make passive currency with promotion as they gain views.
However, if you want to earn a significant amount of money, you will have to dedicate time to it.
How much money can you earn with YouTube?
Although some Youtubers bill millions of euros a year, they can be counted on the hand’s fingers.
On medium, YouTube advertising gives between 0.20 and 3$ for every 1,000 views of a video.
In the channels on curiosities or video games, it is less. In contrast, the channels on financial topics tend to pay more per viewing.
4. Dropshipping
Income potential: Medium-high. It depends on the type of product and the margin you get from the manufacturer.
Investment required: Low. Only the cost of the domain and the server.
Difficulty: Medium. T
The dropshipping system allows you to generate income with eCommerce without making shipments or managing stocks. Thus it becomes a passive method.
The idea is to create a website that acts as an online store to attract customers and collect orders.
Some programs send the order data to the manufacturer in real-time.
The profit margin of dropshipping can be as high as 50%. The main disadvantage is that you are not in control of the delivery and status of the merchandise.
