In this post, I’ll share actionable advice and insights on how to make building passive income easy from someone who’s successfully done it.
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Are you tired of the 9-to-5 grind?
Are you looking for ways to earn money without being tied to a desk?
Maybe you just need some extra cash to pay down debt or pay for a wedding.
Many people are searching for ways to generate passive income (aka income earned with little to no effort), but few actually talk about how to make it happen. I’m here to change that.
What is Passive Income?
Passive income is money earned without active involvement in the earning process. Typically, passive income is earned from sources such as investments, rental properties, or royalties from creative work.
The key to generating income passively is to create a source of revenue that requires little to no ongoing effort on your part. Once established, these income streams can provide a steady source of income for years to come.
Why is It Important?
Passive income is important because it allows you to create a source of income not tied to a traditional job or trading time for money. This type of income can provide financial security and allow you to pursue other interests and hobbies. It can also provide a way to build wealth over time, as the income generated from passive sources can be reinvested or used to pay down debt.
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Passive Income Isn’t New
If you paid attention in history class, you know wealthy landowners and rulers in the past earned income passively by renting out their land to other people. For example, during the Middle Ages in Europe, rich landowners had lots of land they would rent to farmers. The farmers would pay a part of their crops as rent, giving the landowners a regular income without them having to work on the land. The landowners could then use this income to support their lifestyles and do other things they enjoyed, like doing art, reading literature, and going to Bridgerton-like balls.
Additionally, creatives such as artists, musicians, and actors have also found ways to generate income passively. One common strategy was to sell or lease their works for ongoing royalties. For example, actors and actresses earn income passively through residuals or payments made for the continued use of their films or TV shows. Specifically, did you know that the stars of the famous sitcom, “Friends,” earn $20 million yearly in royalties? Crazy, right!?
The Great Equalizer: The Internet
Creating passive income is easier than ever before, thanks to the internet! Unlike in the past, you don’t have to be a wealthy landowner, celebrity, or famous musician. With the rise of social media (allowing you to get in front of millions of people for free) and sites like Spotify, Etsy, and Amazon, anyone can create a passive income stream with a little bit of up-front effort and creativity. So whether you want to sell digital products, create online courses, or start a blog, countless opportunities are available to turn your skills and passions into a passive income stream.
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Real-Life Success Stories
There are many real-life examples of people who have successfully created passive income streams if you know where to look. One example is Tim Ferriss, who wrote a bestselling book called The 4-Hour Work Week, which has helped thousands of people build passive income streams.
However, if you’re anything like me, it’s easy to people like Tim Ferriss and think income like that is not possible for the “average person” because people Ferriss have reached a level of celebrity themselves.
I struggled with this until I came across a passive income stream that doesn’t require influencer or celebrity status or an extreme artistic ability to start or thrive in.
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Passive Income Easy with Digital Products
One of the easiest ways I’ve personally found to generate passive income is to create digital products. These products can be created once and repeatedly sold, providing a source of continuous income. You can create your own website or Shopify store to sell your digital products or sell your products on an existing site like Etsy. Here’s an example of how much I made selling digital products by 8:31 am yesterday:
If you’d like this for yourself, here are some tips for creating and promoting digital products:
- First, identify a problem you can solve for a specific target audience.
- Next, create a high-quality digital product that provides value and solves the problem.
- Third, promote your product through social media, email marketing, and optimizing your product for SEO.
- Finally, continuously improve your product to keep it relevant and valuable.
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How to Build and Grow a Passive Income Business
Building a successful passive income business requires more than just creating and putting a product into the world. Here are some strategies for building and growing a successful passive income business:
- Identify and target a specific audience.
- Build a strong brand and online presence.
- Develop a marketing plan to promote your product or service.
- Always be learning, testing, and innovating.
Common Pitfalls and Mistakes to Avoid
While earning income passively is awesome, there are also common pitfalls and mistakes to avoid. Here are some things to keep in mind:
- Don’t expect instant success. Building a successful business takes time and effort. (I doubt Jennifer Aniston’s first-ever acting gig was “Friends.”)
- Pay attention to your product or audience. Continuously improving and updating your product and engaging with your audience are crucial to long-term success.
- Don’t rely on just one source of income. Instead, diversify your income streams to minimize risk. You can do this by making multiple digital products.
- Don’t do it alone. Starting anything new is challenging, and it’s easy to give up when things get hard. To be successful, surround yourself with positive people who are also interested in achieving a similar goal. Encouragement and sharing best practices go a long way toward passive income.
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Passive Income Resources
If you’re ready to earn income passively, I’ve got some amazing resources for you.
I created a free Ultimate Passive Income Startup Checklist because two of the biggest challenges people struggle with when making passive income are not knowing where to start and feeling overwhelmed. This checklist will solve both problems and help you create your first passive income product in as little as a day.
And if you’re interested in learning more about selling digital products on Etsy like I do, I recommend this free workshop. My friends Cody and Julie from Gold City Ventures created this to help aspiring e-printables entrepreneurs.
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