Passive income is the best financial choice one can make. It involves setting up certain things, like a website or a blog, for example, that run in the background and earn you money without you having to actively engage for hours on end. The famous term, “make money while you sleep” has never been more pertinent. But which passive income streams are the best choice for your money?  

Here’s a reality check: passive income streams are indubitably difficult to create – however, once the groundwork has been laid, they can be very lucrative. The former is the part that sets people off regarding passive income. Very few have the extra time to create a social media channel, set up their home on AirBnB, or advertise their tools to the neighborhood. 

But you can do any of these things, and you should, if you aspire to achieve financial freedom in your later years. There are some increasingly sophisticated methods of generating passive cash that, once fully developed, can result in a completely hands-off stream of income. 

The best part? You can create multiple streams of passive income and watch the growing strength of your cumulative passive income. 

What are the best passive income sources in 2023?

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Best passive income streams that work today:

Create an online course

Skillshare. Udemy. Coursera. What do these learning platforms have in common? They’re all rich content resources where teachers – regular people like you and I – post their skills and knowledge for the benefit of others. It's easy, convenient, and free to publish courses online, which makes it an obvious choice for people aiming to start their passive income journey. 

Simply find something you’re good at (something that has real value, that people would want to understand further, like throwing a baseball or graphic design, for instance) and use the course creation tools on your site of choice. If your course picks up some traction, through your personal advertising or through their magical algorithm, you will be earning the big bucks in no time. 

Invest in real estate

Real estate investments is the number one choice for people who are serious about earning passive income. It takes a lot of work to set up, a lot of research to understand, difficult to manage, and a lot of time and patience, but once you have everything up and running, consider yourself one of the lucky few who have a prime income generator. 

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There are a lot of people who want to invest in real estate because everybody knows that is the best and surest way to make money, but not everyone can afford to or know where to start. To make real estate investing easier for them, we created the MetaWealth app that takes real-world real estate assets, fractionalize them and offer the shares as individual investments. That way, anybody can start investing in real estate and earning passive income with just $100. 

Try the app for yourself now - it’s free and easy! Download the app. 

Invest in the stock market

Specifically referring to dividends, investing in the stock market is made easy with apps like WealthSimple or Robinhood. (In fact, you can even set up an auto-transfer directly from your bank to those apps, helping you maintain your investing streak.) Dividends are quarterly payouts from companies to shareholders. The more stock you buy from a company (making sure they are dividend stocks), the more you can get per quarter. This is basically a company’s “thank you for investing with us” gift. Thus, passive income is generated by simply holding stock, and hopefully, continuing to invest more. 

Dropship

Imagine setting up an e-commerce business where your only job is to be the middleman between supplier and customer. You take the profits, and there’s little risk since you pay the supplier after the customer is charged. If that sounds good, welcome to drop-shipping. 

You can make your e-commerce store a “trendy” store, selling different products at different times, i.e sell Christmas decorations during winter, sell mosquito traps during summer. 

Drop-shipping requires a lot of effort to understand and set up. It is definitely a saturated market, but that shouldn’t deter you from attaining this stream of passive income. Be creative with your sites and advertising, find a lesser-known niche to drop-ship to, and start making money. 

Rent out unused, luxury, useful items

You have stuff that other people want. And they’ll pay to have it. The question is, are you willing to give up or rent out certain items to make money? 

There are three categories of items for sale or rent: unused, luxury, and useful. 

Unused items are just that: unused things taking up space in your house. Whether it's a piece of furniture or equipment, going through your house and finding things you haven’t used in a long time (six months to one year) is profitable. People would pay less than buying it brand-new, and you get some extra cash on the side, and freed up space in your home. 

Luxury items are a bit trickier. Usually, some sort of contract must be in place in the event of damage or loss of the item. But if you have a nice watch or an expensive necklace, and you don’t wear it often, people will absolutely pay top dollar to rent it for a night out or a vacation. Imagine making money from your watch that is overseas? 

Useful items are probably the most rewarding of the three. They encompass equipment and tools, seasonal and year-round. Homes are in constant repair and maintenance, and not everyone has the highest quality tools lying around. You can be their saving grace by offering your high-quality tools for rent. Furthermore, if you have camping equipment, sports equipment, and others, pay attention to seasonal demands. People who are desperate for a weekend away, but don’t want to outright buy new camping gear, will want your equipment for whatever price you ask. This also requires contracts for damages and stolen property, and make sure you know who you’re renting to.  

Peer-to-Peer Lending

Peer-to-peer (or P2P) loans are personal loans between you and borrowers, administered by a third-party. As the lender, you earn passive income through interest payments. However, there is always the risk of defaults.  

Annuities

Annuities are basically a passive IOU (I owe you). You give a company that handles annuities a large chunk of money, and in the future, they will provide you with a steady stream of income. This helps with retirement savings, for example, giving you a guarantee that you will have a constant flow of money as long as you’re around. 

This falls under passive income due to the fact that you aren’t really lifting a finger to generate the money, just putting it aside for your future self. 

Write a low-content eBook

With Amazon taking over the publishing game in 2023, there is no better time to launch your very own low-content eBook. The basic gist is creating a book with blank pages, like a journal. Designing a nice cover and spine are important, and once published, you can let Amazon’s algorithm do the rest. Here are some starter videos on the topic: 

• ‍https://www.youtube.com/watch?v=AHhsr1rUXUw‍
• https://www.youtube.com/watch?v=V1aT2WtQhsM‍
• https://www.youtube.com/watch?v=ZMB5gNfqarU

As you can see, you can make hundreds if not thousands of dollars through this simple avenue. Some people have this as a primary source of income, which tells you the power of this income stream. 

Rent out rooms or your entire home on AirBNB

If you’re an empty nester, need some roommates for college, or anything else, think about renting out your spare rooms. Whether the stays are short-term on AirBnB, or long-term on a lease, this passive income method can be powerful in making money and even meeting new people. 

Making sure the correct precautions are taken considering you are opening your home to strangers, like background checks for potential tenants and contracts for damages and/or stolen goods.

Going further, let’s say you’re going on a long summer vacation from June to August. A full 60 days of your house being completely free. That property is a prime spot for travelers! Putting your place on AirBnB and hiring a good cleaning company means that your home is making you hundreds to thousands of dollars even when you’re away. 

Affiliate Marketing

If you own a blog, a website, an email list, or a social media account with a sizable following, consider using affiliate links. These are links to websites like Amazon, eBay, and more, where you get a commission if a customer – using your affiliate link – buys something. 

If you regularly post product reviews, or advertise what you’re using that day/week, these affiliate links are easy ways to earn extra cash and gain the trust of your following. 

Sell your hobby on Etsy

The Internet allows the majority to make money. This little-known but powerful fact means that you can advertise your hobby, like knitting or drawing, and sell thousands of copies to people around the world. 

Etsy is an online marketplace for small businesses and creators who have creative hobbies. Some construct oil paintings, others are skilled in pottery. Whatever it is, and whatever you’re looking for, Etsy has the people and the products. 

Since you’re already engaging in your hobby of choice, why not see if there’s a market and overall demand for it? Test out selling one or two pieces, and if they acquire some attention, you’ll have an abundance of customers waiting to nab your next creation. It’s a win-win for both parties!

Become an influencer on social media

Becoming an influencer is difficult as it is. Everyone wants to live the lifestyle of the 1%. Since the industry is saturated with…talent…how can this avenue benefit you?

Many advantages stem from being an influencer, and the ability to attract sponsorships, collaborations, and donations is growing. Platforms like TikTok, Instagram, and even YouTube are starting to provide creator funds to the accounts that keep people engaged in their content. Think about that: from one viral clip on any of the aforementioned platforms, you could be making money. And if the clip is evergreen, a term used to describe the longevity of a video, this passive income could be trickling in for years.

Pick a niche, something you’re already familiar with and enjoy. Figure out a content strategy to start out with, taking into account quality and consistency, two critical factors in content creation. Then, start posting it and sharing it with friends and family. The larger your following is, the more likely you are to attain sponsorships and collaborations with companies. Just don’t expect it to be an overnight process. 

Buy vending machines and ATMs

Who doesn’t love candy and money? Buy vending machines and/or ATMs and put them in high-traffic areas around your town and city. Better yet, put them next to each other, so people can grab quick cash for a quick snack. 

Some resources to look into for buying vending machines:

• ‍https://www.nerdwallet.com/article/small-business/how-to-start-a-vending-machine-business‍
• https://www.ownr.co/blog/vending-machine-business/

Some resources to look into for buying ATMs: 

• ‍https://www.wikihow.com/Buy-an-ATM‍
• https://www.businessnewsdaily.com/11229-profitable-atm-machine.html

Crowdfund real estate

Crowdfunding has emerged in the last few years as another interesting investing choice. Instead of being the sole owner of a property, you can invest small amounts of money and co-own properties with others. This negates the legal fees and paperwork associated with sole ownership, and allows you to diversify your portfolio in many different markets. 

Buy a small, local business

Negating the need to build and advertise a company, outright buying a local business can be of great intrigue. Since it's already established with its own customer base, it's less of a risk and more of an opportunity. There’s always the option of hiring a manager to run the place.

Obviously, buying an entire local store is not possible for everyone. If you don’t have the entire sum required, there’s always the option of partnering or investing in the business.The point is to make financial decisions that don’t break that bank but allow passive income to flow. Just make sure you don’t invest in a business that you don’t have the foggiest idea about, as that might lead to problems down the road. 

Conclusion

Passive income is a hot commodity, especially in this economy. The development and maintenance of one or many streams of passive income can set you up for a bright financial future. Making sure to research the best avenues for you, and also taking care to not break your lifestyle to set up these passive income streams are things to keep in mind. 

Financial freedom changes your life in many different ways; let passive income be your guide to an unrestricted, unlimited future.

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