Your articles are so in-depth and helpful, I’ve never seen anything quite like it. I am a 22-yr old finishing my last semester of college, studying Computer Science and Psychology. I’m in a really good place with my finances (2k savings, no student debt, only expenses essentially rent, groceries, and utilities) and I want to get ahead financially so I can pay my parents back and save up a lot.
P2P lending is the practice of loaning money to borrowers who typically don’t qualify for traditional loans. As the lender you have the ability to choose the borrowers and are able to spread your investment amount out to mitigate your risk. The most popular peer to peer lending platform is Lending Club. You can read our full lending club review here: Lending Club Review.
If you are not able to get a mortgage on the property, there are still a few options available though rates can be fairly high. You might try approaching the seller for owner financing where they sell the property to you on monthly installments. This might not be possible if there’s a mortgage on the property since many carry a “due on sale” clause. If you do go this route, make absolutely sure you get a notarized contract with all the details.
For Tim, that was learning and writing a series of books, which he’s truly passionate about. For me, that’s traveling, learning, and working on startups that are “high risk” or have a long road to generating revenue. For you, maybe it’s spending time with your kids and not having to take overtime when it’s offered to you. In any case, the goal is to spend as little time as possible to cover your basic needs; if you want to spend more time to make more money, that’s always an option — but you want it to be an option, not a necessity.
Passive income is defined as income-generating activity that is independent or loosely dependent on time commitment. Just so we’re on the same page, here, there’s no such thing as making money without creating value (I wish), and creating value takes time and effort. So, you are technically transacting time for money, in a way. But passive income is where we separate or at least alienate the proportional relationship between time spent and money made. It’s where there is no longer a fixed ratio, and if there is, it’s not a 1:1 ratio, but more like a 10 or 20:1 ratio of man-hours-worth-of-time to actual time. As another side note, knowing how much your time is worth both to you and on the open market is a valuable piece of information for guaging how effective your passive income activities need to be.

I just sold my 80th ebay item and things sure are different. Now, I don’t wait for my money because I have a card. I know exactly what to do upon choosing an item to sell which takes me 1/10th the listing time. I’ve developed an eye for items that sell on Ebay through osmosis. THE POINT OF MY COMMENT IS …… if you want to make money online remember one thing, you best be ready to work! Work Work Work! Because through those efforts you will have an intimate understanding opposed to a theoretical (or “TALKATIVE/CONVERSATION) Understanding….
I have only dabbled in drop-shipping before when I had an eCommerce platform 6 years ago or so. I think it is something that you could do on the side, but you would want to do in depth research on the industry you want to get into before setting up shop. It may be a little less passive up front, but over time you could take your hands off the wheel.
Rentals, just like stocks, throw off cash. With rentals we call that cash “rent”, and with stocks we call it dividends. A significant difference however is that the S&P 500 has appreciated at ~6% per year (above inflation) for the last 100 years…..Real Estate has had almost 0 growth above inflation. So are rents higher than dividends? Maybe, maybe not. But unless you got one heck of a deal, the delta in rent over dividends will have a very tough time making up for the 6% per year difference in appreciation.
I’m looking at accepting a professor job. It’ll be more than a 50% pay cut. But I’ll have the same life you describe – endless summers and an entire month every winter to ski. I’m thinking in the end, eventually, I might even end up wealthier in more ways than one. Happy people tend to be the most successful. I have no desire to diversify. Dividend stocks allude me. CDs seem like a good choice for older people, but I have time on my hands and real estate knowledge, so I’m sticking with what I know, despite the fact that most people will tell me it is foolish and I should diversify.
Residual income is money that is earned on a recurring basis, typically as the result of a single original action. Rather than earning an hourly wage, residual income is typically generated through an initial investment of time or money with the goal of earning continuous payments. Once the initial investment, product, or service is made, the ongoing income that is earned is generally passive in nature.

In order to build an audience, you need to have a platform. You need to have something worth following and sharing; something that’s valuable to others. And that, of course, takes time. That’s not to say you can’t build a huge audience in a short amount of time. But as much as we hear about the people who’ve succeeding at doing this, we don’t hear about the millions of others who are struggling every day to get just a few more fans and followers.
Occupational therapist Sarah Stromsdorfer founded occupational therapy site MyOTSpot.com three years ago as an online educational resources for occupational therapy students and professionals. She worked on it every weekend, and her site now makes enough income for her to work as an occupational therapist part-time. She believes it will be another year before her site makes enough money for a full-time living of about $4,000 per month. In addition to the digital products she also makes money from ads and online book sales.
Developing passive income is different. With the exception of one of my passive income streams (cryptocurrency mining), all of the others require real, hard work. Truly, I understand the barriers for people getting into building alternative income streams. I would say that most people WANT passive income, but truly aren’t willing to put in the blood, sweat, and tears to make it happen.
The challenge I’m facing and, I know it’s a good problem, is that the SF real estate has shot up about 35% in the last couple years. I’m sure you’re experiencing the same thing! So as the net worth is rising, the yield on the total portfolio is going down. Right now, it seems the only way to increase the passive income will be to raise the rent in December and to invest some of that cash in stocks, which I’m nervous to do in this market. Current allocation:
Anthony, nice setup! To your question about the rental mortgages, you haven’t said what interest rate you are paying. As a start, if you are paying more than the risk free rate (Treasury bills) which you probably are, then a true apples to apples comparison would be yes, pay off the mortgage. But, if you are comfortable taking more risk, you have other options to invest in which you *hope* will yield you more over the coming years. You also didn’t say whether the rentals generate net income and if so, how much? What is the implied rate of return on the equity you have invested in them? If you pay the mortgages off, you’ll have even more equity tied up, will the extra net income make that worthwhile? Maybe you should use the money to buy more rentals instead, if purchase opportunities still exist in your town. … this is less of an answer than a framework to analyze the decision, hope it is helpful. 

This company mainly focuses online business and internet marketing products, but there are also other products ranging from health and fitness to travel. One of the great things about DigiResults is that both vendors and affiliates get paid at the point of sale, and not a month or two later like most affiliate marketplaces. I’ve been using their system and so far it’s one of my favorites.
However, if I sorted through the data, grouped it into specific subjects, created a simple website, did the Internet marketing necessary to bring the website to the attention of other newbies and sold the re-packaged data (which would now be my own product because I’ve applied process to it), I could save other people from such overwhelm AND make some income for my impoverished self.
Thank you for being a part of this community. Thank you for reading. I hope that I can continue to encourage, support, and motivate you to achieve your life goals. And if I’m not, let me know how I can better do so. There are so many different platforms to connect with me – on Facebook, Instagram, and Twitter, but I tend to respond fastest through one of these methods:
Awesome article…if this does not give somebody a clear roadmap, they probably were never going to get there in the first place! I’m kind of like you trying to figure out where to place “new” money and maturing CD’s in this low interest environment. Rates have to go up eventually…I dream of the days again where you can build a laddered bond portfolio paying 8%. I plan for a 5.5% blended rate of return, with big downside protection.

A good portion of my stock allocation is in growth stocks and structured notes that pay no dividends. The dividend income that comes from stocks is primarily from S&P 500 index exchange-traded funds. Although this is a passive-income report, as I'm still relatively young I'm more interested in building a large financial nut through principal appreciation rather than through dividend investing. As an entrepreneur, I can't help but have a growth mindset.


Love your articles. I think everyone is very different as far as how much passive income they need to meet their goals. I’ve read a lot of your articles and really enjoy your thoughts. I have a masters in finance and understand the math of keeping the debt but my emotions are such that I need to try to finish off paying off my last debt (mortgage) in the next two years. At 34 and only worth 525k I’m doing better than a lot of folks my age but it will be difficult for me to catch up in the passive income game without leverage. That is the main reason I recently created a website to try to bring passive income opportunities in my area to me.

​Udemy is an online platform that lets its user take video courses on a wide array of subjects. Instead of being a consumer on Udemy you can instead be a producer, create your own video course, and allow users to purchase it. This is a fantastic option if you are highly knowledgeable in a specific subject matter. This can also be a great way to turn traditional tutoring into a passive income stream!


I’m a 45 year old business owner who also has focussed on diversifying my income streams. I have a short term vacation rental in Florida that I bought for $390k in 2012 and net rental income for the last three years has been growing steadily. 2015 I am at $70k gross right now but should end up at $80-85k with net around $45k plus we use the place about 35 nights a year.
5 months ago, I decided to create my own online business. I was really exacted because It was always my dream to earn cash by working from home to be able to unite my family and to retire my father that had been working as a security far away from home. My family and I only used to see him three times a year. I would like to change it, and online business gave me a possibility to make my dream to become real. I really was committed to giving all my self to succeed in building a successful online business. As a matter of fact, I failed to do it on my own. I was so disappointed because it seems that I was born to fail. It was 22nd June at night, I was hearing a motivational speech, so one of the guys said,” Copy what successful people’s strategy as your own, and you will get the same result that they have”. That opened my mind because that was the secret, I did not realize that there are a lot of people in this marketing a year. So, I took some online courses from gurus. Following their steps. right now where am I? I am now a successful online business of 22 years old trying to retire his father. I really thank people a lot that have the mindset to share this priceless information in this blog. Indeed, thank you.
So, I sat down, wrote a few posts, and posted them on a simple website under the name Passive Income MD. I honestly didn’t expect anyone to read it. Well, that was two years ago and so much has happened since. Most notably, I’m now in a position where I am financially independent from medicine. In fact, I’ve started to cut back at work in order to find that happy work-family life balance. I don’t have any desire to quit medicine completely, but I do intend to retire gradually.
Let’s continue the vintage BMW idea. Old cars obviously require quite a lot of maintenance. Many people will buy a “fixer upper” with the intention of spending their spare time repairing and restoring it. There’s a very obvious market here: a guide to restoring different BMW models. Depending on your knowledge, you could produce detailed guides for the three or four most popular models and sell them. Not everyone restoring a car will buy them, but some probably will.
It’s obvious that stocks outperform real estate in terms of capital gains, but I would like to see S&P compare to Real Estate in SF, Manhattan, LA. Our house in NC was $80,000 20 years ago. It’s only $150,000 now. Same house in Santa Monica went from $200,000 to $1.8 million. People who happen to bought real estate in major metropolitan would have a natural positive association with real estate investment.
Focus on your primary passive income stream first. It's difficult to grow your passive income into multiple streams if you don't already have one, solid stream. Focus all of your efforts on that one project first and help it grow as productive as possible. Then, you can take the money you've made and lessons you've learned from this passive income stream and put them into others.
A perfect example of the Active Problem Solving + Automation concept is in my online courses I’ve created over the years, or my free webinars I’ve created more recently Each of my online courses and webinars are targeted to help people with specific problems, whether that’s in the area of affiliate marketing, podcasting, building a brand, and so forth. I am always improving upon the courses, but they are also evergreen for my audience. 
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