If you're trying to learn how to make a passive income, the hardest part is going to be choosing the method. That's because there is no shortage of ways to learn how to make a passive income, only a shortage of time and resources. Of course, some people do make the time to try quite a few passive income streams, but when you're first starting off, it's best to stick with just one or two until you get the hang of it.
What's the Best Way to Learn How to Make a Passive Income?
So which of the many ways is the best when you want to learn how to make a passive income? Here are nine of the most popular and lucrative:
- Affiliate Marketing. Affiliate marketing is nothing more than marketing other website's and company's products. You sign up with the company or site and are then given a link to the product, complete with your own ID tracking number. When a person clicks on that link and makes a purchase, you get a commission. Many affiliate or associate programs are run through sites like ClickBank and CJ Affiliate (formerly known as Commission Junction). When you get your link, you can share it on social media sites, create a blog to review products, write articles, optimize a website, create PPC ads—the possibilities are enormous.
- Auto-Respond through Squeeze Pages. You can set up a website that does nothing but attracts people to the site and provides them with free and valuable information and downloads. In return, they give you their email address. By compiling your email list, you'll have a list of customers that you can sell to and subscribers to funnel into your sales pitch. Your newsletter can push all types of affiliate offers and other products and opportunities you are using to create passive income streams. One of the best ways to learn how to make a passive income.
- Drop Shipping. This is relatively new, but essentially all you are doing is partnering up with a company or manufacturer, taking orders for them online, sending the orders in and then collecting a commission. This is great because you can set up entire websites dedicated to vast product lines without having to actually stock or ship the items yourself. You're simply another way for the company to attract visitors and make sales—they handle all the shipping themselves. This is an advanced way to learn how to make a passive income because of the amount of setup involved.
- Membership Websites. If you have a wealth of valuable information about any type of niche or industry, you can set up a site that teases visitors with free information but then requires them to subscribe to the site to access the higher quality info. This is recurring income since membership fees are due periodically. If you don't want to spend the time to produce the content yourself, you can always outsource the work but just make sure quality-control is maintained or you will lose subscribers. This is a relatively easy way to learn how to make a passive income, provided you have the knowledge and resources.
- Arbitrage. There are tons of companies looking for web design and content creation as well as tons of cheap labor out there. If you can act as the middle man and pair the expensive clients with the cheap labor, you can profit off of the difference without having to do anything other than attract the clients and assign the work. As far as learning how to make a passive income goes, this can be difficult to pull off since attracting the passive income stream is contingent on attracting the clients.
- Selling Information. While this is similar to the membership website, instead of having an ongoing burden of labor, you only create products in spurts. For example, writing an eBook, putting together some software or a webinar, creating audio files, etc. The information will normally be digitally delivered so there is no monitoring of the website—people pay the fee you are asking and then immediately receive the product. Since you create the products, the profit is 100%, unless you wish to outsource the creation. You can be elsewhere as the money rolls in.
- Portfolio Investing. If you are financially savvy and good at predicting trends, you might want to learn how to make a passive income by investing in stocks, bonds, high interest dividends and other financial institutions. The goal here is to get the most return on your investment while eliminating as much exposure to risk as possible. This is different than playing the market—even small gains are acceptable. What is not acceptable is losing money or breaking even—that is not a passive income, that is a loss or a push.
- Real Estate and Renting. There are two ways to learn how to make a passive income with real estate. First, you can invest in land or houses and then flip them for a profit. You can accomplish this in a market where you buy low and sell high, or if you fix up the place and flip it. Second, you can invest in apartments or commercial real estate and rent out residentially or commercially. This is a great way to learn how to make passive income because your revenue is guaranteed every month as long as you have renters occupying the property.
- Peer-to-Peer Lending. Finally, there are sites set up all around the Internet which allow you to look over business proposals and requests for loans, negotiate the details with the borrower and then lend people money at your own interest rates. What's really great here is that the interest rates are generally higher because the borrowers are typically high risk and cannot get loans elsewhere. The bad news is that if a borrower defaults on their loan, you might have to spend some time and money to get what is owed.
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