11 Passive Income Ideas for 2024

Take a look at these 11 top choices for passive income.

Updated: January 3, 2024
Matt Crabtree

Written By

Matt Crabtree

 

Finding ways to enhance your income, or even start earning an income from home has become more and more popular. Utilizing passive income is a great way to bring in some extra money for the increased costs of living and inflation that the world is currently experiencing. 

Expenses keep going up and unfortunately our paychecks just can’t seem to keep up. If you’re looking for a way to supplement income, passive income could be helpful. But how do you start generating passive income? 

We’ve put together 11 top choices for passive income ideas. Take a look at these options and learn all that you need to know to make a decision. 

Passive Income Explained

Passive income is primarily defined as making money from something you are not actively involved in or managing. There are several different ways to accommodate passive income strategies, and some of them are investment related, while others aren’t. 

The IRS actually defines passive income as unearned income.

You didn’t earn that money from physical labour or an employer, although it may feel like you earned it based on your investment work and research. It takes hard work sometimes to create passive income streams

Rental income is one of the most common forms of passive income, but it’s certainly not the only option. There are actually a multitude of choices when you’re looking at ways to create income on a passive level. 

Check out these top 11 options. 

1. Dividend Portfolios

If you have some money to invest, this is a great choice. Your money will hopefully be growing a little bit, while at the same time returning dividends as passive income for your needs. There are a large number of dividend investments to choose from. There are ETFs, mutual funds, and stocks that pay dividends. 

Look for stocks and other assets that are high dividend yielding. Here are a few ideas for you. 

  • Imperial Brands
  • Magellan Midstream Partners
  • Verizon
  • SPDR S&P UK Dividend Aristocrats ETF
  • iShares UK Dividend UCITS ETF

Notice that this list has some ETFs that pay dividends as well as stocks. And this is really just the tip of the iceberg, but it might give you some inspiration as you where you can start. 

How do you know about an asset’s dividend? Look for dividend-paying options and then check out their dividend yield. This tells you what their dividend payouts average. These can change from payout to payout so you might also want to look at the historical numbers and whether or not they pay consistent dividends. 

2. Rental Income

Rental income is one of the most well-known passive income choices around. If you can set up rentals and get income generating, this can be a reliable source of income for years to come.

As a landlord, you will have some responsibilities to care for. 

While this isn’t your job, the income stream is reliant on you doing some work to make it happen. Managing rentals can be overwhelming if you don’t know what to really expect. Before you jump in, take the time to do some research. 

If you play to invest in multiple rentals for passive income, there may come a time when hiring a property manager is beneficial to you as well. In order for this to be successful, you will need to do some due diligence. 

Choose properties that you can afford and that won’t require a lot of extra expenses or costs on an ongoing basis. There are financial risks to owning properties and getting quality renters can be a challenge. But once you get a feel for how the process works, you can set it up in a way that suits you. 

3. Write a Book

Writing a book probably seems like it takes a lot of work. The truth is that it does require a lot of work. In fact, there are many people out there that spend their time doing this to make a living. When you write a book, you typically get an initial contract and then you receive royalties for ongoing sales for the book. 

If you write multiple books, you generate passive income from all of them. If you’re a talented writer, take the time put your words to paper. The best option for books now is to create an e-book. These get a lot of attention and they don’t cost nearly as much to edit and publish as there are no printing costs involved. 

Amazon and several other platforms are a great way to entertain distribution on a global level as well. Your e-book can be short and sweet and still bring in income. The challenge is marketing the book and getting consistent sales. It may take some time to really start paying off. 

4. Bonds and Savings Accounts

Savings accounts certainly aren’t paying out what they used to. However, there are still some great choices for high-yielding savings accounts out there. If you can find a really great savings account that rewards you for setting aside some extra funds, this could be a great way to earn a passive income. 

Another option that works similar to savings accounts are bonds and CDs. The biggest difference is that bonds and CDs will have reduced liquidity and are tied to maturity dates that dictate when you can access those funds without a penalty. 

A savings account is a good starting place.

While you build up an emergency fund and start to acquire a savings, you can take advantage of the interest for your passive income needs. It’s a good idea to establish a generous savings account before you start delving into any type of investments. 

Bonds and CDs pay out income based on their featured interest rates. CDs can be purchased from banks, but there are also brokered CDs that are purchased in the stock market. Both of these assets have a stated interest rate, and that’s what your passive income will derive from. 

5. Affiliate Marketing Choices

One of the most common choices now for passive income is affiliate marketing. This has become supremely popular with stay at home moms, as well as other people simply looking for unique ways to earn an income stream. 

Affiliate marketing can fall into several different categories. Here are some things you might recognize. 

  • Influencer
  • Bloggers
  • Vloggers
  • Amazon affiliates
  • Social Media affiliates
  • Multi-level marketing companies

The idea behind this concept is that you are affiliated with a company, or sometimes multiple companies. You get perks and you get a link to share within your social media or blogging space. Then, your followers and fans click on those links and sometimes purchase through those links. 

Your connection and those clicks or sales lead to commissions. A lot of people partner with Amazon, but there are many other options out there. You use social media or another platform to then appeal to the masses and get those clicks. 

It takes time to build a following and make consistent income. You’re going to be putting in some work to do that, but this still falls into the passive income category. 

6. Crowdfunded Real Estate

Another choice that has become more and more popular in recent years is crowdfunded real estate. Let’s face it. We can’t all afford to invest in properties. Whether you simply don’t have the liquidity to do so or you don’t have the credit to take a needed loan, there are reasons preventing you from running out and buying up some property, right? 

Crowdfunded real estate investments take a lot of that responsibility off your shoulders. Not to mention, you don’t have to worry about things like property management, finding tenants, collecting rent, or making repairs. With this type of approach, you simply invest money and let others do the hard parts. 

There are different selections for crowdfunded real estate.

You are going to need to do some research and find a good fit that seems solid. The requirement on your end will be to come up with the minimum investment amount. Be sure to seek out options that fall into your price range. 

From there, you put in your investment and then you just pay an annual management fee for the ongoing maintenance and management of this real estate. The challenge here is choosing a reliable crowdfunding source and making wise investments. It can be a big decision and if something goes wrong, you’re out that money. 

The passive income comes from the revenue or income generated from this property, usually rent or lease payments. 

7. P2P (Peer to Peer) Lending

Another new market approach is peer to peer lending. This is where you sign up to lend money to other people, usually people you know nothing about. While you can lend to peers and let them pay you back with interest, this concept is usually you offering funds to a third-party and letting them coordinate the lending process. 

Companies like Lending Club, Funding Circle, and Prosper are all part of this type of lending. You become a lender, but your lending occurs through one of these coordinators. You can lend minimal amounts, or you can lend large amounts. It just depends on what you are able to do. 

The risk is that these companies often provide funds to people who struggle to get credit approval from other sources. That being said, you can choose prospective borrowers and turn down selections as well. 

It’s possible that you will be part of multiple loans, but all of that detail is provided to you. The passive income is earned from people making their loan payments on time. You will likely need a way to track and manage the outstanding funds that you have, log received payments, and how much interest you are earning. 

8. REITs

A REIT is a real estate investment trust. These are investment assets that hold and manage real estate within them. You can invest in REITs by purchasing directly into a REIT that is open, but you can also purchase mutual funds or ETFs that are invested in REITs for indirect exposure. 

REITs almost always pay out a steady income dividend, and that dividend will likely go up over time. These investment assets are unique in that they pay little to no corporate income tax thanks to passing income through to shareholders like you. This is why REITs make a great choice for passive income – the income is going to be passed along. 

A REIT that stands alone can sometimes be a risky investment.

They are considered moderate risk choices. This is why some people turn to ETFs or mutual funds that hold REITs. You will still be able to receive passive income, but you diversify your risk so it’s not all tied to one particular REIT choice. 

Always take the time to do some basic research and get to know just what you are investing in before you drop the funds into them. 

9. Online Designs for Sale

Are you familiar with Etsy? What about shops like Zazzle or Café Press? These are the perfect illustration of creating a design and then selling it for some cash. If you have any type of crafty or artistic capabilities, you can earn a steady stream of income from this approach. 

Create designs and then list them for sale on sites like these. People will come along and purchase the right to use your design for a product. They may be making postcards, printing t-shirts, or doing something completely different. 

The beauty of it is you get credit for your design, and you make some money every time it gets used. Zazzle lets you simply put up your design and then people come along and choose the product they want with your design on it. You get paid every time someone selects your design. 

On Etsy, you can just post the design and then sell the rights to the digital image or a pattern of your design to interested buyers. Some people create their own websites and sell their online designs through Shopify platforms rather than going through a third party like these. 

You get to choose whether you are going to print and create inventory, or whether you are going to simply supply the design and let others handle the rest from there. Your income is based on people purchasing or choosing your digital design. 

10. Stock Photos

Another great way to earn a passive income is for stock photos. It will require some work on your end, but most of the time it’s just putting your photos out there for the world to access. They pay you for the right to use your photo when they need it. 

There are tons of sites out there for stock photos that people flock to. Some sites allow you to post photos for free, while others allow you to charge for the photos.

Sites like Unsplash and Pixabay have free photos and paid photos. 

Other sites, like Shutterstock, require people to pay for every image they utilize, or to have a paid subscription to their platform. These are just some examples, but there are plenty of other ways to sell your stock photos. 

If you are talented in photography, this just might be a great option for you to make a passive income. Put that camera to work and then start making your amazing photos available in places that will earn you income for the use of the photo. 

11. Car Advertisements

Did you know that you can get paid for letting someone else advertise on your car? Maybe you’ve seen the vehicles with signs, car wraps, or other forms of advertisement. It always catches your eye. 

The owners of those cars are getting paid for allowing their car to be a marketing platform. You do have to own your car to do this, but it’s a great way to earn some passive income. You take that car everywhere you go. Imagine the thousands of people that see the marketing and advertising. 

You just have to drive the car and follow the rules of the company. You will be made aware of those rules before you commit. You advertise for them and you get paid in return. How you get paid might vary from company to company. Some companies pay a set fee for your driving, while others will pay you by the mile. 

Just make sure you find a platform that isn’t running scams for the operation. Take time to research for a legitimate partner with a track record of success. 

What If I Have No Money to Earn Passive Income With?

The good news is that there are plenty of options that don’t require you to invest a lot of money. Yes, some of these do require upfront investments, but things like car advertisements and online stock photos don’t force you to spend a lot of money to reap the benefits. 

Final Thoughts

Earning a passive income is often chosen to add some extra earnings to your pocketbook. For some people, that will be their spending money. Others will turn around and invest those funds into savings, investments, or other assets. How you use the passive income is totally up to you. 

There are so many different ways to earn a passive income. These are just a few brilliant choices, but there are so many more options out there. The key is to find some way that you can earn money without having to put out a lot of continuous effort. This isn’t your job or primary income, but it’s reliable income all the same. 

What passive income method do you plan to try?

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