Many entrepreneurs look for ways to diversify their portfolios. One of the best ways to do this is by adding passive streams of income. The main reason passive income is the best type of income is because it doesn’t eat up your time. It’s something that practically runs itself on the side, while you focus on other things.
This removes the ceiling from your earning potential. You can even have a full-time job with a great salary and several passive sources of income working while you sleep. Or if you choose the right business, it’s possible to make enough money to quit your day job and lounge on the beach. If any of these ideas appeal to you, maybe it’s time you look into one of these businesses that can give you the freedom you crave.
The Amazon FBA (Fulfillment by Amazon) program is something the retail giant came up with in 2006 as a way to attract more sellers. It works by allowing you to list and ship the products you want to sell to Amazon while they take care of the rest for a small fee. This is a semi-passive model if you do it the way most sellers do it. It requires shopping for and shipping inventory. However, what some successful sellers have figured out is that they can take a lot of the work out of the process by finding consistent products. And most of the six-figure sellers private label their products and have them drop-shipped directly to the warehouse.
An example of this would be a vitamin business. You would first find a quality supplier, test the sales in small quantities and then order the ones that sell best. At that point, you can ask the manufacturer about private label supplements that you can put your own packaging on. Then you can find a company to print your labels and hire someone to apply them, package your inventory, and ship it to Amazon.
Lending clubs, also called peer-to-peer (P2P) lending, is a way to invest and earn interest on loans made to other people. It works by depositing amounts, as small or large as you’d like into one of these services. You might then partner with other individuals in the network to loan someone a specified amount of money. So, say someone wanted to borrow $1,000 and you were willing to chip in $100 of that. Ten other peer lenders might also decide to go in on it with you. Then you will all agree on an interest rate based on some borrower factors and earn interest every time he or she makes a payment.
Real estate rental
Real estate is almost always a solid investment. You’re buying something with equity that you can later use to your advantage. Of course, being a landlord is another type of job that you can make as passive as you want. You can do maintenance work, improvements, landscaping, and interviewing all on your own. Or you can hire other people to take care of it.
Hire a manager to take care of the day-to-day or emergency details. Ask him or her to hire other laborers as needed if you’d like. Just make sure you keep up with your free property management software so your manager can keep track of financials, run background checks on tenants, and perform other necessary business tasks.
As most successful bloggers will tell you, this can be a highly-demanding job that requires a lot of your time. But it doesn’t have to be. Many site-owners have figured out ways to make blogging a passive form of income that pays six figures or more. For one thing, you can outsource all your blog-writing. And if writing isn’t your strong suit, you probably should anyway. But then they add affiliate ads to their sites. And if they’re getting good traffic, these ads can bring in major revenue.