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12 Great Ways How to Generate Passive Income Online and Offline

Updated on June 8, 2012
Put your feet up and earn
Put your feet up and earn

Sitting Back and Earning

In this current economy, many people are searching for ways to generate more income with little or no risk. They don't want to quit their day jobs because it's a guaranteed pay check, but they want to earn more with little effort. Many think that it's not possible unless you own a well-oiled business or invest in the stock market.

For me, I wanted to investigate ways to create passive or residual income. I'm a mother and want to spend more time with my daughter and less time behind a desk. So, what is passive income? It is a way to earn money, for months and years to come, without putting very little additional time or effort into it.

Here I will outline ways how to generate passive income so that your bank balance will grow while you spend time doing the things that matter the most in your life.

Time Investments

I want to break up the types of passive income into categories, and my first category is time investments. Let me be clear that the following passive income generators are based on significant amounts of time invested. If you have time to spare and you can work on the following projects, you will make money with no risk at all.

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The number one way that I am currently generating passive income is by writing online. My writing comes in different forms from Hupbages to writing my eBook. There are many websites that offer ad revenue sharing in exchange for your articles. Check out a great list of websites here. The great thing about writing is that you can do it from anywhere in the world, in your own time, on any subject of your choosing. If you know a little bit about keywords, search engine optimization, and backlinking, you'll further benefit from your online articles. But how does it earn you passive income? Hubpages pays you for the ads that are placed in your articles. Once your article is written, it will continue to earn for years to come. You can also write an eBook and profit from the sales or royalties.

But you don't have to solely write for online publications and websites. Why not try your hand at writing a real book and have it published? You can even sell it for the increasing popular Amazon Kindle. By publishing a book, you will have to make the initial investment in time to create it, but the money will continue to roll in for years to come. If you would like to learn about how I make passive income with Hubpages, you can read more here.

Earn Royalties

With the design industry up in arms about creative licenses, people are now being more cautious about using copywrited material. Many purchase stock photography from websites like Shutterstock to use for their projects. By allowing these websites to sell your images, you can earn royalties between $0.25 to $75 per download. If you can create high quality images that people would love to use, you could generate a nice income from digital photography. You can also sell music on websites like CDBaby or Tunecore.

Affiliate Marketing

If you know anything about the internet, you'll probably know what affiliate marketing is. If you don't, read on. Many online companies offer an affiliate marketing program for websites, blogs and writers to promote their products or services. In return, they will pay you a percentage of each sale or signup. There are many affiliate websites that offer affiliate programs, like Commission Junction, Clickbank, and Google Affiliate Network. If you can post their ads on your website or link to a specific product, you will be paid when a reader clicks or buys. If you have the know-how and determination, you can earn a great deal of money passively for years to come.

Create Games/Apps

The hottest items sold online are games and apps. If you know how to create games or design an app that people will want to use, the potential for passive income is huge. By creating a game or an app, you can set the cost and watch the money roll in. Try selling your digital creations via Apple's iTunes or on Google Play.

Hire a Team

If you're great at managing people and delegating tasks, you may want to consider building a team of freelance professionals to work for your clients. Ideas may include web designers, content writers, transcriptionists, or remote receptionists. Check out oDesk to help you to hire professional and build your team.

Cash Investments

In many cases, you will see a return on your investment and be able to generate passive income if you are able to invest money. There are many different ways to make your money work for you for the coming years. Here are a few examples of how you can generate income with cash investments.

Invest in a Business

There are many budding entrepreneurs with great ideas but little cash. If you would like to invest money in a business and make a financial gain, there are many websites that will help you to do so. Try Lending Club, where you have the potential to earn between 6-18% interest on your investment.

Start Your Own Business

Although owning your own business comes with great risks, it also has the potential to earn you an ever increasing amount of income in the future. Once you have established your business and hired the right people, you will have the ability to sit back and put your feet up while others take care of your business. Although you will be able to retire, your bank balance will continue to grow. This is the ultimate way to generate passive income.

Gain Interest

If you don't have a lot of money but you are eager to save, opening a high interest savings account could be your answer. By creating an automatic savings plan, whereas money is automatically deposited into your account every week or month, you will quickly see your savings grow. If you choose a high interest account that is without fees, like with ING Direct, your money will make money itself. If you are interested in opening an ING account, enter the orange key 30346645S1 when signing up to receive $25 for free to start you off.

Purchase Property

The experts say that the only really good investment that you can make is in property, and now is the time to do it. With housing prices at an all-time low, it's a buyers market. You can buy to rent a property and earn money from leasing, renovate and flip a property, or just hold on to a property to wait for the sellers market. You should even consider investing internationally, where markets are even lower in different parts of the world.

Reseller Hosting

If you currently design websites or have the ability to sell web space, then reseller hosting may be a great way to earn passive income. You can buy space from a company and act as the middle man, selling it to your clients. Check out websites like Host Gator or 1aHosting for pricing and details. You can even buy and sell domain names and websites on websites like Name Drive to make an extra profit.

Stock Market

This is a risky type of passive income, but if you know your way around stocks, bonds, mutual funds and any other types of financial investments, you could make a great deal of money. It's best to fully investigate what type of investment is right for you. If you're unsure, consult with a financial advisor or investor for their professional opinion. For easy online investing and for tips and tricks, check out ShareBuilder.

No Investment

Rent a Space

If you have free space to rent, like a basement, bedroom or even a couch, you can rent it out to tourists or people who need a place to park. If it's a long-term renter you're after, you can post your space on a website like EasyRoommates and contact only the people you would want to share your space with. If you would like to give up your space for short-term tourists, you can check out AirBnB for vacation rentals.

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    • kenneth avery profile image

      Kenneth Avery 3 years ago from Hamilton, Alabama

      crafty bird,

      I love this hub and how you wrote it. You possess an amazing gift of writing.

      I was proud to vote Up and all of the choices. Loved your graphics.

      Keep up the fine work and I will always be your fan and follower.


      Kenneth Avery, Hamilton, AL.

    • La Verne Amigo profile image

      La Verne Amigo 4 years ago from Philippines

      great hub!

    • MSGolden51 profile image

      MSGolden51 4 years ago

      Hi, this is an awesome hub full of useful information I will be using some if no all. Thank you!

    • Darren Owens profile image

      Darren Owens 5 years ago from Bay Area, California

      Great Work! Very useful and informative. Thank You!

    • kellyteam profile image

      Willette 5 years ago from Michigan

      Awesome hub. Lots of good information. Thanks for the tips and keep on hubbing!

    • Free2writ3 profile image

      Free2writ3 5 years ago from Sharon Hill, Pennsylvania

      Very useful tips. I might try some

    • travelhouseuk profile image

      travelhouseuk 5 years ago from UK

      nice photo...!

    • tammyfrost profile image

      Tammy Frost 5 years ago from Oregon

      Great Hub...Full of useful Information that many of us Hubbers will enjoy. Great Work.