Hey guys! So today, we are talking about passive income and best ways to make money online. But before You read this You need to realize a few things about Passive Income.... It takes HARD WORK, GRIND, PATIENCE, and PERSEVERANCE to generate significant passive income...
First You Have To Believe That It's Possible! Most People Never Overcome That Hurdle....
Passive income, - source
is earnings derived from a rental property, limited partnership or other enterprise in which a person is not actively involved. As with active income, passive income is usually taxable. However, it is often treated differently by the Internal Revenue Service IRS. Portfolio income is considered passive income by some analysts, so dividends and interest would therefore be considered passive.
Passive income differs from earned income and portfolio income in a variety of ways. Passive income is generally defined as a stream of income earned with little effort, and it is referred to as progressive passive income when there is little effort needed from the individual receiving the passive income in order to grow the stream of income. Examples of passive income include rental income and any business activities in which the earner does not materially participate during the year.
Passive income differs from active income which is defined as any earned income including all the taxable income and wages the earner get from working. Linear active income refers to one constantly needed to stay active to maintain the stream of income, and once an individual chooses to stop working the income will also stop, examples of active income include wages, self-employment income, martial participation in s corp, partnership.
There are two kinds of passive activities:
- Any of cash flowing property income – which include profits from ownership of capital, rent from ownership of resources such as Rental income and incoming cash flow from property or any piece of real estate, and interest from owning financial assets.
- Trade or business activities in which one does not materially participate during the year.
Forms of limited partnerships may be considered passive as long as the limited partner does not have any role in the company and they exchange their capital investment in return for a share of the activities profit.
Now, passive income ideas
Method #1 Amazon Affiliate Program
Amazon.com offers up to a 10% referral fee for all qualifying sales made through links that you place on your website, blog, or social network stream.
The ease of use and popularity of Amazon makes their Associates Program a good place to get your feet wet with affiliate marketing. Once you've been approved, login to your account and you'll discover tons of options to build links and ad units for Amazon products.
Amazon Associates Web Service provides detailed product information across as many Amazon product lines as you wish to promote on your site, while giving you complete flexibility to display that information in a manner that fits with your Web site's design. You can create a complete, dedicated store or integrate product content into appropriate areas of your site.
Amazon Associates Web Service exposes most of the rich product content that makes Amazon such a great place to shop, including real time pricing and availability, product images, product descriptions, customer reviews, sales rank, and more. With this content, you can create and display detailed product pages that provide visitors the information they need to make a purchasing decision.
Method #2 Ecommerce
Ecommerce, also known as electronic commerce or internet commerce, refers to the buying and selling of goods or services using the internet, and the transfer of money and data to execute these transactions. Ecommerce is often used to refer to the sale of physical products online, but it can also describe any kind of commercial transaction that is facilitated through the internet.
Whereas e-business refers to all aspects of operating an online business, ecommerce refers specifically to the transaction of goods and services.
Examples of Ecommerce
Ecommerce can take on a variety of forms involving different transactional relationships between businesses and consumers, as well as different objects being exchanged as part of these transactions.
The sale of a product by a business directly to a customer without any intermediary.
The sale of products in bulk, often to a retailer that then sells them directly to consumers.
The sale of a product, which is manufactured and shipped to the consumer by a third party.
The collection of money from consumers in advance of a product being available in order to raise the startup capital necessary to bring it to market.
The automatic recurring purchase of a product or service on a regular basis until the subscriber chooses to cancel.
Any tangible good that requires inventory to be replenished and orders to be physically shipped to customers as sales are made.
Downloadable digital goods, templates, and courses, or media that must be purchased for consumption or licensed for use.
A skill or set of skills provided in exchange for compensation. The service provider’s time can be purchased for a fee.
Method #3 Make Money Reselling Online Products & Services
The first thought that pops into my mind is web hosting and the second thought is mobile websites.
These are just two examples of the types of things you can resell to businesses (or people) in the real world.
So you setup a website for your company saying you do x, then attract the customers, and then when you convert them all the work is done by the product company. You take the classic middleman margin.
How’s this passive?
Well, I’m assuming you build your marketing around a blog, You Tube channel, social media etc, so it’s automated and long term.
And then I assume that the delivery of the product is done by a VA in the Philippines – so easy to get someone to setup a website for someone, or organize hosting etc.
The best deal is when you buy in bulk (eg hosting), sell off in chunks and it’s a regular repeat (and automated) transaction. Welcome to paradise son!
PS also think about services you already provide (not passive) and ways you can generate passive income from them, eg ecommerce store designers build on Shopify and then take 20% affiliate fee from Shopify…for life!
PPS One specific idea is to look at buying developer’s licenses to online products and then selling the use of them by others, eg say a plugin that helps people backup their website – you get the developer’s license and then your offer is to install the plugin (provide a service as a developer) and show them how to use it, and they pay a quarter of the plugin’s usual retail price.
I’m assuming you have VAs together with documentation to make this process seamless and most of all, passive. Nice!