In today’s fast moving life everybody is busy in doing something or other to earn money to fulfill his or her basic needs (such as food, water, shelter etc) and social need (friends, relatives, prestige and feeling of accomplishment). To fulfill these need some are doing business, some are doing service and get salary, other choose professional life to earn money such as doctor, lawyer, chartered accountant, architecture etc.
Whether you are a businessman or a doctor or lawyer or work in a company, one thing is common is that you earn income (money) from that. But one more thing is common is that you will earn until you devote your time and efforts or engage yourself in that. Suppose if a doctor does not go to his clinic or hospital, he will not earn. An employee cannot get paid if he is absent from his company for a long time. Without focus in your business you cannot run it.
So, from above examples, it is very much clear that you earn when you give time and effort and if you don’t, you will stop earning. This is called active income, which comes till the time you are active and once you become inactive it will stop coming.
Now, let’s talk about Passive income. Passive income is income which comes from those sources which requires minimal or no efforts but generate income on regular basis. Passive income keep generating money even when you are sleeping or you are on holiday.
Are you excited to know how passive income can be earned, So, let’s discuss different source of passive income one by one.
Rent a property:
if you possess a property or flat (other than where you live in), you can give it on rent. It will start giving you monthly income in form of monthly rental for which you need not to do anything except putting your property or flat on rent. If you don’t possess an extra flat, you can use your saving and buy a flat which can be given on rent to unlock you passive income source.
Become Insurance Agent:
Becoming an insurance agent is not so difficult you just need to pass one IRDA exam and after few days training you are ready to sell insurance product of the company you have chosen. You can become agent of SBI Life, LIC, HDFC Life, ICICI Lombard etc. You can start with selling insurance policy to your relatives and friends and once you get confident then can sell to public at large. For every policy you sell, it will start giving you commission till the policy term ends provided the policy holder keep paying premium of his policy. In this way you unlock another source of passive income.
Buy dividend paying stocks:
Dividend is part of profit which company distribute on regular basis to its shareholders. If you have knowledge how to invest in share market and ready to bear some risk, then you can choose some good dividend paying stock and invest your money in them. These stocks will start giving you dividend as and when company declare that. You need not to make any effort to chase your dividend as it will automatically get credited to your linked bank account provided you hold these shares on dividend record date. We will discuss more about Dividend paying stocks in our later articles.
Website / Blog writing:
If you are good in writing and can talk about some interesting topics, which people love to read or solution which people are searching on internet then make a website or blog and upload your article on this website or blog. More and more people read your article more traffic your site will generate and once your site start generating regular traffic then join you Google AdSense account with your site. Google Adsense will post adds on your site or blog and start paying you as per its term and conditions. After making initial efforts to get traffic to your site, you will become strong candidate to get paid from adds on your site. One thing you should keep in mind is that the you should always maintain quality of content at your site because content is the king and people will keep on coming at your site if you provide quality information to them.
Become a YouTuber:
Are you having good sense of humour and can make people laugh? Are you good in cooking? Are you a good actor? Are you master in your field like Finance, Marketing, Engineering, IT, etc.? Are you a good dancer? Can you make video on giving tips to people on different matter such as how to manage your finance, how to invest or you can make viral videos then YouTube is a great place to show your talent and earn smart money from there. You can make video of your talent and if your video goes viral or people like your video content then you will start earning from YouTube. More and more people watch videos on your channel which you made on YouTube, the more money you will earn. So, being a YouTuber is also a good source of passive income.
Make a Corpus from Active Income:
You love saving and by now you have made a corpus (deposits) from your saving or you are planning to make a corpus from your saving then you are on track on unlocking one more source of passive income because your corpus can give you regular returns such as Fixed deposits in Bank with option of monthly or yearly interest pay-outs. Corpus of PPF has a lock-in of 15 years and after completion of these 15 years, you can invest in those category of investment which can generate regular income for you.
Once you unlock your source(s) of passive income, you will start feeling financially independent. There would be no fear of job loss or what if my active income will get stop. We have suggested above examples to you and now, its upon you which you opt for and which one suits you the best but all needs efforts at-least in initial stage and then you can taste the feeling of being financially independent.