Passive income is a single income stream amongst a tsunami of ways to make money both online and offline. There are literally millions of ways to make money and every income stream comes with it’s own pro’s and cons.
With the invention of the internet and the online explosion that followed these vast income streams have diversified and expanded. Anyone anywhere now has the opportunity to make money, especially online.
With low startup costs for online ventures, the chance to experiment is now available to anyone with an internet connection.
When it comes to the entrepreneurial idealistic income stream, few can compete when it comes to passive income.
What is passive income?
Passive income in it’s simplest term is an income stream that generates with little to no input or work from it’s owner.
This income stream will develop sales or some form of financial reward for content or services that the income owner does not need to work to supply.
The ongoing maintenance of the product or services should also require little to no input in order to maintain a profit for the foreseeable future.
In simple terms, passive income is an income stream you have running and generating income while you relax or work on something else.
What are the benefits of passive income?
It would probably go without saying what benefits a passive income has over other types of income. But just in case you can’t see it, we will go over them.
The fact that passive income involves little to no input, it gives it’s owner the most valuable asset in the World, time. It gives you the time to go and work on another project, spend time with your family or even take a holiday.
While you are using your newly found time, your passive income is generating money to fund your lifestyle. This can be particularly useful for anyone who wants to work or live remotely.
For example, setting up a passive income stream in the UK earning £1500 per month would be a modest income to most people.
However, if you were earning £1500 passively via your UK website and living somewhere else. Lets say a sun soaked beach in South America. That £1500 will translate into a very good living in the country of your choice. This allows you to go for a meal or work on your tan while your stream pays without your input.
Sounds amazing, right?
Well it kind of is! Passive income may be the holy grail for a lot of people cross the World.
The number one commodity no matter how much you are worth, is time. Passive income gives you money for no work which buys you that time.
Are there downsides of passive income?
With everything in life there has to be some form of downside.
With that being said, the downsides to passive income are very limited.
We have done our best to look at passive income objectively and it is difficult to find the negatives. With that being said we have tried to be over critical in an attempt to show all sides of the argument.
It could be argued that nothing lasts forever. Passive income streams are potentially one of those things that proves that rule.
Whilst you might be earning a very good income via a passive income stream, it is still important to plan for the future. The stream wont last forever, so it may be prudent to put money aside for the day it all stops.
This is true of every business though and is a bit of a stretch when looking for negatives.
The only other side of the negative coin is possibly the work needed to get the passive income stream running, and more importantly, earning.
This is almost never a small task. Whilst a passive income stream requires little to no input from it’s owner to be classified as passive income, the work originally put into the project is obviously not included in that assessment.
The greatest passive income streams normally have seen a hefty amount of work to get the project up and running. This can come in the form of hours spent or money invested but it hasn’t just materialised. Serial passive income entrepreneurs are happy to dedicate a month of work to a passive income stream in hopes of months of returns.
Nothing is all sunshine and roses especially when it comes to business. Passive income is guilty of the same negatives that can be pointed at any income stream but realistically, it is the ultimate income stream.
Examples of passive income
Passive income can come in many shapes and sizes.
Whilst many passive incomes are known and well published, just like any company or any entrepreneur, the diversity is huge.
English entrepreneurs are no stranger to adapting and innovating new ways to make passive income. That makes a fully comprehensive example passive income list realistically impossible to create.
With that being said we have rounded up the most popular UK passive income streams that we have seen successfully implemented.
- Renting of property or assets
- Dividend Stocks
- Vending machine owner/operator
- Advertising space owner
- Dropshipping eCommerce
- Online eBook sales
- SAAS (Software as a service)
- Software creation/sale
- Online photography/Image Sales
- Music creation/sale
- YouTube content creator
- Affiliate Marketing
It is important to take note that many of these options require vastly more initial time input than others. It is also noteworthy that some have a much higher barrier for entry such as rental properties needing hefty finances to buy the property initially.
All ways have their own pluses and minuses and they are by no means the complete list. These are however some tried and tested methods that have made and continue to make many people rich across the World.
Choosing which one would work for you is going to depend heavily on you, your skill set along with some trial and error.
How do I make passive income?
The first step is to just start.
Pick a niche or an area that you have identified as a potentially passive income stream and get going.
Set out a clear business plan on what you want to achieve and how you will achieve it. Coding a website has never been easier with multiple YouTube tutorials at your fingertips. You may even want to look at buying an existing passive income stream via Flippa or similar. After doing your due diligence it may be a great way to start your passive income journey.
Not all passive income streams are guaranteed to be successful so it is important to have realistic goals.
If this is your first passive income venture then get ready to learn a lot as you go. Failure is part of every entrepreneurs journey but with passive income, if you succeed you may never have to work again.
If that isn’t the entrepreneurial dream then we have no idea what is.
Even if you fall into the workaholic section of entrepreneurship you certainly wouldn’t turn your nose up at extra income for little to no work.
Having a revenue stream isolated and automated is going to go a long way towards financing your other ventures or your lifestyle.
Whatever your situation if you haven’t seriously considered passive income streams then you may be missing out.
