7 Tips for Generating Passive Income
Contributed by: Rebecca Wright This e-mail address is being protected from spambots. You need JavaScript enabled to view it
Many definitions for passive income include income that works for you, income that comes in even when you are away or asleep, and income generated from investments with minimal work such as interest, dividends or rentals. People describe passive income in different ways, but the IRS definition of passive income is “income generated by an activity in which the taxpayer does not materially participate.” Book royalties, stock dividends, referral bonuses, rental income and interest on money in a bank account are all passive income. To make money from rental income, interest in money in a bank account or stock dividends requires an initial outlay of money. To make money from book royalties and referral bonuses requires an initial amount of work to either write a book or make a qualified referral of a customer to a company or vice versa. In the modern world, passive income comes from some source that is generating money after an initial setup and which may require some maintenance, reliable dedicated servers, and good viral marketing to keep generating income. The power of the internet has created a multitude of opportunities for not only generating income but harnessing an incredible marketing machine, reaching millions of customers and creating innovative business models.
(Free) Internet Marketing
Take advantage of free internet marketing. If you have a product or service to sell or a business to promote, rent email lists to reach millions of prospective customers without the expense of direct mail and traditional advertising. Email marketing, Twitter and other social networking engines are fast, easy and inexpensive ways to build large customer bases.
Create a Website and Generate Traffic
The value of an online presence is in attracting traffic. People who visit your site and are exposed to your product or service or message are valuable “eyes”, or prospective customers. The traffic to the site generates interest, sales and advertising opportunities that make money, especially if your site is backed by dependable business web hosting provider.
Make Advertising Pay
You can earn income with your website by joining affiliate programs, selling advertising services and joining pay per click programs like Google AdWords which pay you when your visitors click on their buttons placed on your site. Or you can concentrate solely on advertising and promote other businesses for them for a fee.
Turn Trash and Treasures into Cash with Auctions
Sell your trash and treasures with online auctions. Start by cleaning out your closets, garage and attic, and move on to garage sale bargains that you turn over through online auction sales for profit. Graduate to higher-end collectibles or vintage merchandise if you’d like.
Sell Information
Information products are cheaper and easier to sell than a physical product that must be inventoried, packed and shipped. If you have a particular area of expertise or a beloved hobby that you’d like to write about, develop it into an information product such as a how-to booklet or cd or a whole program.
Enter the Blogosphere
If you love to write, blogs are an online opportunity to write about what you love. Blogs also give you the opportunity to participate in affiliate advertising and link programs, write reviews for others (for money) and even blog for others such as businesses, professionals, etc.
Membership
If you have a website or blog, you have an opportunity to offer specialized information and services through membership programs. You can offer trial, partial and full memberships for customers to access special areas of the website or obtain an ongoing series of products and services or even classes you develop.
