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At first you may only be making a small amount of money passively, and you may even want to re-invest that money so it compounds and grows quicker. However, with a few time, its potential to make enough passive income you could quit your job or retire early.

Passive income can be a bit of a divisive topic. In general, passive income is any money you earn without putting in much effort. The money will flow in without too much being demanded of you. In some scenarios it could be long-term recurring income, and in some other instances it might be short lived or inconsistent.

In some circumstances youll need to put in some effort up front, but then it wont require as much effort in the future when youre making the money.

What qualifies as passive income is up for debate. Most lists which youll find online will include things such as blogging, writing e-books, or creating your own course. Im not including those thoughts in this post because, in my opinion, all of them require too much effort to be considered as passive.

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Blogging will always need on-going work, either by yourself or by other people that youre paying.  Selling ebooks or classes will require on-going customer service, and youll need a consistent traffic supply in order to continue to create sales. It is possible and there are individuals who've been able to do it , but they compose a small percentage of people who really set out to do it.

Ive been blogging fulltime for ten decades and Ive sold ebooks and courses in the past. Theyre great ways to earn money, I simply dont consider these to be more passive, in the majority of cases. .

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Just about any business can be a source of passive income if youre paying others to run the business. That is true with both online and traditional businesses. That opens up even more chances than what will be recorded here.

Now lets take a look at a few of the greatest ways to make passive income. Some of these are investments which will require some money to begin with. Others wont require any money to get started. In case you dont have the money to invest now, consider starting with the content approaches that dont require any money, and then use that money you earn to invest. .

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Your very first financial priority must be to develop an emergency fund that will cover all your living expenses for a couple months. But dont put this money is a checking or savings account at a local bank which pays you a terrible interest rate. You can open a high yield savings account or money market account with an online bank which will earn a lot better return for you.

My spouse and I maintain our emergency fund in a money market account with CIT Bank. At the moment (October 2018) CIT money market accounts are earning 1.85% APY and CIT savings accounts are earning 1.55% APY. Thats 22x the national average! Opening an account with CIT is fast and easy, and can be done online. .

Some companies consistently pay dividends for their shareholders. As look at more info a shareholder, you can re-invest the dividends to purchase more shares of the stock, or take the dividends in money. Reinvesting will let you own more stocks, which leads to more dividends in the future (ideally).

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The companies that consistently pay dividends tend to be large companies with a long track record of success. As a result of this, these investments tend to be considered less risky than the stock exchange in general.

Dividend stocks can be a terrific investment regardless of whether you want to reinvest all of the dividends on hold on to this stock for quite a long time, or make use of the income produced throughout the dividends.

For much more detail on the subject read Investing in Dividend Stocks at Investopedia. For a list of these stocks, see this collection from Dividend.com and this collection from DividendValueBuilder.com.

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Peer-to-peer lending (or P2P) has become extremely popular in recent years. Borrowers and lenders can be paired up through a site or marketplace. Instead of going to a bank, the debtor receives a loan from an investor.

In some situations the borrower may not have the ability to qualify for a loan through a traditional bank. And in many circumstances the borrower gets a better interest rate than they might receive from a bank. As an investor, you can earn a great return as well.