The get-rich-quick scheme is a lie unless one can provide such an immense value within a short time frame, which involves excessive risk. However, the common denominator of the best and brightest business people is they provide value. They saw a need and fulfilled that need through their business ideas. Hence, they can earn millions because it took them several years before finally developing a valuable business model. Value generates money, which can multiply as you’re sound asleep if you got it all correctly.
1. Invest in stocks and shares
This is probably the most quoted passive income idea out there. This investment can skyrocket your funds, provided you invest in the right stocks. Sp500 is an index fund investment composed of the 500 best-performing and publicly traded companies in the U.S., such as Facebook, Microsoft, Amazon, and so on. If one invests $1,000 in Sp500, that amount is dispensed among the 500 companies and will yield a return based on their performance. If you look at the Sp500 and its performance over the past five years, it increased by +2,252.47 (103.13%).
Although the pandemic had significantly brought it low, it was able to recover within just a matter of 4 months and just continuously went up from there. There are multiple index funds and mutual funds out there. This investment is relatively easy as long as you have capital and you opt for the right fund.
What value do we provide in this investment? Money. One needs capital investment, be willing to put it in the stock market, keep there untouched. This can be a challenge at first since, obviously, small investments barely yield significant returns. But if you have savings, why let your money sleep and gather cobwebs in the bank if you can make your money double in stocks while you sleep?
2. Make YouTube Videos.
With the free editing software and apps out there, one need not be a professional videographer and editor to develop a high-quality YouTube video. However, here are the three essential things to make this venture a success:
- Create quality content: If you produce quality content valuable to the end-users, which are your viewers, YouTube’s algorithm can also help your content be discovered by others through recommendations—garnering more views. This includes well-sequenced content, quality edit, high-resolution video, and excellent audio.
- Have a niche and target audience: YouTube is an online jungle of various contents. Hence, you have to niche down and determine your target audience. YouTube has also provided analytics so you can monitor your videos’ performance metrics over a specific period, as well as the demographics and engagements of your viewers.
- Meet Youtube’s qualification for monetization: Seeing ads after months or years of creating content on youtube can be one of the most satisfying moments in the life of a YouTuber. However, one needs to have 1000 subscribers and 4000 public watch hours before monitzation.
3. Invest in Real Estate
Airbnb is a great platform that one can take advantage of when one owns a house, apartment, or condo that people can opt for instead of a hotel room. You can set your price for short-term and long-term rentals, pay a 20% service fee and VAT depending on your home country, maintain the property, and ready your pockets for the revenues. But of course, among all the three long-term investments that could generate passive income, this one requires the most work and knowledge. One has to pick the right property with the right location and purchase it at the right season.
Several factors affect the price of a property, so one has to put in the time and effort to list, narrow down, and eventually acquire a property. There are many good deals such as foreclosed properties from banks and loans and properties one can acquire through an assume-balance basis. Regardless of all the things required to set up the real estate renting business, investing in real estate will be a sure way to generate profits in the long run and is also a good investment plan.
As you observed, the level of passiveness in the term passive income varies depending on the investment type. It will take months or years to acquire capital to invest in stocks to keep the ball rolling. Hours and hours for months spent crafting content before the first ad will play. A ton amount of time to gain savings and find great deals on real estate properties.
But if you put all the required work into it during the developing stage, you will reach that state when your passive income can cover your next vacation. The best time to start investing is when you are young; the second best is now.