The term “passive income” is hot right now. Ever since the 4-Hour Workweek by Tim Ferriss came out, it seems like everyone around me is searching for that elusive magic bullet business idea that will allow them to sit on the beach, daiquiri in hand, and make money effortlessly.
I’ve been a full-time entrepreneur for 6 years now, but have to admit that I have never discovered the secret to easy and instant money. (Otherwise I’d be blogging from somewhere that has a breeze and nice palm trees right about now.) But many people I know get caught up in searching for that “perfect” easy-money idea, and become stalled in actually building their business. So instead of spending their time effectively growing their business platform, they end up doing nothing at all and aren’t any closer to the ultimate goal of self-employment and steady income.[quote align=”center” color=”#999999″]I want to make a distinction—there is “Passive Income” and there’s what I like to call “Set Effort Income”[/quote]
Instead of constantly hunting for that “perfect” passive income/easy-money idea, I find that the most effective approach is to slowly and regularly incorporate passive income strategies into your existing business (Check out my article on How to Create Multiple Streams of Income to learn more about how to do this. Over time, your passive income will increase and your dollars-for-hours work can decrease if you want it to.
Here’s the deal though—when I read about “passive income” ideas and strategies, most of what I find isn’t passive at all. For instance, “blogging”, “consulting” and “Etsy selling” are all considered passive income according to various Internet articles. In my opinion, there’s nothing passive about any of those—they take a lot of work and can’t necessarily be streamlined.
So I want to make a distinction—there is Passive Income and there’s what I like to call “Fix Effort” Income. Let’s look at both of these…
Passive income is income that comes from products, programs, investments or services that are in the system and set up to run themselves and send you a check every month. It will take some time and effort to set up passive income streams in the beginning, but then there’s not much (if any) work required after that.
“Set Effort” Income is income that comes from a business/source that’s NOT dollars-per-hours where there is no cap on the amount of income you can make from doing a set amount of work or effort (hence “set effort”) every week/month/year. An example of this is blogging. With a blog, you do a set amount of work each week in upkeeping the blog–creating content, marketing, etc–but the profits you can make from a blog are unlimited and scalable just like passive income.
So in this article, I want to look at 7 actual PASSIVE income ideas for your business that you can start building on and incorporating today…
#1: Write an eBook
It’s never been easier to create and publish eBooks than it is now. Once you create an eBook and set it up on Kindle or post it on Clickbank, you’ve done the work (unless you decide to spend time marketing it) and the rest is passive income. Plus, your eBook can be an effective tool that drives more traffic to your business or website.
#2. Create an eProduct or eCourse
Creating eProducts or eCourses is a great way to repurpose your already existing content and create passive streams of income. Just like eBooks, once you create them, they can continue selling for years to come and you’ll never run out of stock.
#3. Write a Book
In an era where digital products are rampant, there is still a great market for physical books. Unlike ebooks, books are timeless and will end up adding more value to your business than just sales. My boyfriend always says, “You can’t get onto Oprah with an ebook” meaning that there is still value in the physical book, even if it’s just a business-building strategy. Also, with print-on-demand capabilities, you no longer have to worry about the up-front investment in a stockpile of books.
#4. Sell Stock Photos, Video, or Audio
As a photographer, I’ve spent a lot of time researching the selling of stock photos and video. There’s a hot market for all of these right now and it’s a great way to build up passive income over time. It’s kind of like the visual version of an ebook because you own the content but typically sell it on a 3rd party platform. (e.g. In the case of ebooks, you’d sell on Kindle and with stock photos, you might sell on iStockPhoto)
#5: Promote Affiliates
Becoming an affiliate for other products or services is a great way to make passive income. When you promote other businesses in exchange for a percentage, you can provide value to your audience and make money with very little effort. There are thousands of affiliate programs out there, so finding some that align with your business and vision should be fairly easy.
#6. Create an App
App creation is all the hype right now. The question is: Is the market oversaturated? I vote that there is always room for another app that provides value or solves a problem. That’s the foundation for any good business idea.
#7. Design a Niche Site (or a few of them)
If you’re web-savvy, you might choose to launch a few niche sites that are built around high-traffic keywords (check out Market Samurai to do this effectively). If you do it right, niche sites can make money while practically running themselves and they can also be a great platform to sell your eBooks and other products on.