17 Best Passive Income Ideas for 2024

Today from this article, we would like to provide 17 Best Passive Income Ideas for 2024

You can generate passive income by investing in a few types of financial assets or by creating businesses that, after an initial investment, begin to produce income without any more work than required for upkeep. This type of income will be taxed differently depending on where it comes from, so be sure to keep good records of your income.

What is passive income?
Passive income is money that you make without having to perform any daily work to keep it up. Passive income doesn’t come from wages that you receive at a job, but can be received through rental property income or investment dividends.

This is the opposite of active or earned income, which can be described as money you make that requires daily work. But this is not to say that passive income is easy money, but the opposite is true. Most ways to generate passive income require an initial investment of either money, time or both; the income part comes later. But at least after making an initial investment in a passive income-generating venture, this income can pay off for years down the road.

17 passive income ideas for 2024

  • Dividend stocks
  • Dividend index funds or ETFs
  • Bonds and bond funds
  • Real estate investment trusts (REITS)
  • Money market funds
  • High-yield savings accounts
  • CDs
  • Buy a rental property
  • Rent out your own house
  • Get a roommate
  • Peer-to-peer lending
  • Private equity
  • Crypto staking
  • Write content
  • Publish a digital course
  • Wrap your car with ads
  • Rent out a parking space

Investment-based passive income ideas
Here are a few different types of investments that pay dividends, which can create a passive income stream.

  • Dividend stocks
    This is one way to build an income stream: By investing in dividend stocks, which distribute part of a company’s earnings to investors on a regular basis (usually quarterly), you can build income over time. The better dividend stocks increase their pay out over time, helping you build a larger income stream for the future.

Dividend stocks are usually not as volatile as growth stocks, with added benefit for diversification and stability in your investment portfolio. Many investors, in fact, will choose to reinvest dividends back into the stock to further grow their investment should the stock do well.

  • Bonds and bond index funds
    Instead of buying a piece of ownership in a company with a stock, bonds are a way for investors to lend money to companies — as well as federal, state and local governments — and collect interest income. Bonds are considered a safer investment than stocks, but also generally earn a lower return on your investment.

Experts recommend investing a portion of your portfolio in bonds because of their lower volatility and relative safety compared to stocks, then having a higher ratio of bonds in your portfolio the closer you are to your investing goal (such as retirement).

» Learn more: How to buy bonds

  • Real estate investment trusts (REITs)
    If you want to build passive income from real estate without the fuss and bother (not to mention the hefty down payment) of buying and managing properties yourself, REITs may be the answer.

Like mutual funds, REITs are companies that own commercial real estate, such as office buildings, retail spaces, apartments and hotels. REITs tend to pay high dividends, but they vary in complexity and availability. Some are publicly traded on stock exchanges; others are not.

New investors may want to stick to publicly traded REITs, which you can purchase through an online broker. You can also diversify your real estate holdings by investing in mutual funds or ETFs that track multiple REITs.

» Learn more: REITs — what they are and how to invest in them

  • Money market funds
    One simple search provides interest rates of 4% or more for money market funds. This is much like the high-yield savings accounts; the investments are low risk, such as short-term government debt or corporate bonds paying interest. In some instances, that interest can be tax free. Of course, money market funds are not money market accounts, where you can think of this like a savings account, and their FDIC insurance does not necessarily apply.

» Read more: The best money market funds right now

Interest-based passive income ideas
These interest-based ideas are less risky than investments since their rates are set by the Federal Reserve, and nothing can come out of your investment. After all, your money does not lose value in these interest-based investments as it would with a stock or fund.

  • High-yield savings accounts
    Another way to earn passive income (albeit at a lower level than stocks and bonds) is a high-yield online savings account, which can be ideal for growing your emergency fund. The interest paid by savings accounts is added to your balance.

High-yield accounts are a type of federally insured savings account that earns an interest rate that’s often much higher than the national average. The APY of these high-yield accounts may vary slightly, and over time, those small differences add up to real cash, so it pays to shop around for where you put your savings.

  • CDs
    A certificate of deposit is a type of savings account that’s used for a fixed period of time. For example, you might deposit funds in a three-year CD, and in exchange, you’ll receive a fixed interest rate for those three years. This is in contrast to a high-yield savings account, which typically has a variable interest rate.

CDs often pay higher interest rates than savings accounts, because they require you to lock up your money for a set period of time. (You’ll pay a penalty if you want to access your funds before the CD term ends.) If you’re willing to do that, locking in interest rates while they’re high can be well worth it — especially if you expect them to come down soon, as many experts do.

Property-based passive income ideas
These ideas revolve around owning and renting physical property. Some, like buying a rental property, may feel out of reach, but if you have a spare room you could consider renting it out.

  • Buy a rental property
    The next option is in investing in real estate to get rental income. Long term rentals are most likely going to provide a steady stream of cash if in a healthy market for renters but they also come with long-term stress in maintaining the properties, as well as paying multiple mortgages, property tax bills, and other costs.
  • Rent out your own house
    Some people use the money earned to buy a vacation home — it might just turn into an additional vacation home. If you can’t afford to buy an entire rental property, then you can consider renting out your own residence while on vacation. AirBnb and Vrbo allow you to set exact dates people can rent your spot. If you’re away for the summer, for example, or over the holidays, then it may just be an opportunity to earn some additional dollars.
  • Get a roommate
    If you’re looking to get into real estate, you can also start small: Rent out a room. Getting a roommate will provide regular, most likely monthly, passive income. Unfortunately, it may mean you have to share a bathroom and fridge space.

Alternative investment passive income ideas
These investments are quite a bit riskier than stocks and bonds, so be sure to read the fine print and make sure you fully understand them before diving in.

» Learn more about alternative investments

  • Peer-to-peer lending
    An alternative to traditional bank loans, peer-to-peer lenders, like Prosper and Lending Club, match investors who are willing to lend money with borrowers who have been vetted by the platforms for creditworthiness. It’s riskier than putting cash in a high-yield savings account or money market fund, but also potentially can earn more interest — as much as 5% or more.
  • Private equity
    Perhaps the original form of peer-to-peer lending, another common form of passive income is funding a private business you believe has the opportunity to generate future income. For high-net-worth individuals, this might be investing in private equity funds, which are typically only available to accredited investors who meet certain net worth or income requirements.

Another way is to back a family member, friend or other trusted partner to help fund their business with an agreement to earn returns from any future profits. But beware: No matter how large or small, investing in a single business is an inherently risky, long-term bet. Never invest more than you can afford to lose.

» Learn how to start investing in private equity

  • Crypto staking
    Crypto staking is a way of growing your holdings in certain cryptocurrencies by using them to help verify activity on an underlying blockchain network. When you stake a cryptocurrency, you can be rewarded with more cryptocurrency.

Staking, for most people, involves delegating your cryptocurrency to someone who is compiling records of transactions on the network on which it runs. Those verifiers need to put some tokens at stake to guard against fraudulent transmissions. By giving the voting power of your tokens to a reputable verifier, you can get a share of the rewards they receive for carrying out their job accurately.

But there is some risk: If the verifier you’re working with is penalized, you may be as well. And staking sometimes requires you to commit your holdings for a set period of time, meaning you can’t sell or trade them.

Many crypto platforms now have staking programs, though these arrangements have recently come under regulatory scrutiny in the U.S. It’s worth noting that staking is not an option for all cryptocurrencies — notably, Bitcoin does not support staking.

Product creation passive income ideas
These ideas involve creating something, like content for a blog or an online course, and then allowing the sales of those items to happen in the background. While these ideas require an enormous amount of initial work, they can generate money for you for many years into the future.

  • Write content
    A good way to earn passive income at home is through payments for the use of intellectual property you have created yourself, or for which you have purchased the rights.

Creating content can be a lot of work, especially for content that is engaging and reaches a big enough audience to generate income.

But once you’ve created something that people are using, it’s possible to generate revenue through display advertising, using a program such as Google Adsense, or to run sponsored content, where companies pay you a fee to publish a post on your blog.

Another way to monetize a blog is through affiliate marketing, which is how you can earn commissions if your readers purchase a product or service you’ve recommended or linked to. You may, however, find that creating content is not as hands-off as you might expect; there’s always pressure to create more content or update what you have to keep it viable.

» Learn more: How to make money from blogging

  • Publish a digital course
    Do you have a unique skill? You can teach others how to do what you do—whether it’s watercolor painting, coding, or closet organizing. Just be aware, creating a course can be a lot of work. You will have to write lesson plans, shoot videos, and update the courses depending upon the platform on which you are publishing your course.

Another thing to consider, it’s hard to know how much money you might make from an online course. Some course creators release many courses, and can make their living doing so. Others may only make a couple hundred dollars a month—if that.

Car-related passive income ideas
If you have a car or a parking spot, you might be able to rent out a parking spot or install ads.

  • Wrap your car with ads
    Did you know you can get paid to have your car wrapped in advertising? According to Carvertise, drivers can make between $100 to $500 a month just for driving around. Be wary when looking into companies because there are many scams relating to car wrapping. Look into Carvertize and Nickelytics — but be aware that these companies have plenty of negative online reviews.
  • Rent out a parking space
    If you live in a city, near a concert venue or any other place where there may be a crowd, the Spacer app allows you to rent out a parking spot. You will need a few pictures of the spot, the dimensions and details on the spot’s security and access, and distance to public transit. According to the website, the average host earns about $200 a month for renting out his/her driveway.

17 Best Passive Income Ideas for 2024: Persuasive SummaryMonetize your blog through affiliate marketing, earning commissions when readers purchase recommended products or services. However, creating content requires consistent effort and updates to maintain its viability. It’s important to note that the income potential of online courses varies greatly, with some creators making a living while others earn only a few hundred dollars per month. Additionally, if you have a car or a parking spot, consider renting it out or installing ads for potential passive income. Learn more about making money from blogging.

Leave a Comment

Finance Guide PDF

Claim Your Free Finance Guide PDF Now

Take control of your finances with our free guide! Learn essential tips and strategies for managing money effectively.

Thank you for subscribing

to receive our “Finance Guide PDF.” Please check your inbox for the download link to your complimentary guide. Rest assured, your privacy is paramount to us; your details are safeguarded as per our Privacy Policy.