In the last article of “Increasing income” series you read Anupam’s real life sharing about how he created his second income (we thank him for sharing his experience with our readers). Today let’s go a little deeper and learn ways by which YOU can also create passive income stream, which means ways of income where you do not work actively and still the income is generated.
We can see that a lot of you are interested in creating passive income but you don’t know from where to start, so after reading today’s article take at least one committed step to create second source of income in your life. After you complete reading today’ article, in comments section share at least one new idea for creating passive income.
We are a community of 50k+ people at jagoinvestor, if we all share one good idea for creating passive income, imagine what kind of passive income idea bank we will be able to create.
The rich get richer. Not only because they have surpluses with which to invest, but because of the overriding emotional release they experience from having wealth
– Stuart Wilde
I really want you to take a day off from your routine life and name the day as “PI day” of your life. On this day, you won’t touch upon any other area of your life,you will only think about creating passive income and nothing else. As next step create a special kind of account in your life called “P I income account”, in this account you will accumulate passive income, it should not come from real work or from active job. Passive income is the kind of income where either your money works for you or your people work for you.
10 ways to create passive income
(Do not discard ideas instead start thinking how the ideas can get into your life)
1. Rental Income from Real Estate
You can create rental income with the help of real estate. If you have more than two properties, the rent you get from one can help you to pay the EMI of other property you own. You can give your office space on rent or your second house on rent. You can also create either boys or girls hostel, if you have more than 1 flat on the same floor. Some even create small office units in one big commercial space and they give it on rent to people who do not have frequent visitors.
Make sure that you are selecting right people and legal aspect is taken care of. If someone (only if you are the owner) has good office space in Pune, we would like to touch base with you. (In 2015 we would like to establish jagoinvestor office in the city of Pune).
2. Buying Space for ATM Centre
This is one of the best ways to create passive income. Generally in a building, the space which is below the stairs gets sold at lower rate as compared to other offices and it is ideal place for ATM Centre. Banks can even pay upto 25k-50k per month to ATM centre owners in big cities, but again it depends on the location and the area where you own your space. There is a detailed discussion on this topic here
3. Buy extra Parking lots and renting it later
Parking is one of the biggest problem that everyone is facing today. One of our clients created passive income from the parking space that he owns in his building. Also I know someone who owns open plot next to a multiplex; he gave his space on rent to multiplex for parking purpose. This may not be possible for all but as I said do not discard ideas from your life.
4. Create Websites & Blogs
The machine age is over and we now leave and breathe inside information age, where no one cares where your office is or how many people staff you have, with the help of internet from a remote place you can create a lot of money. Creating a blog or a website is almost free (or I can say it is not very expensive) and is one of the best ways to create passive income.
You can do this as a part time activity and start creating second income in your life. This may be a slow process and it calls for good content for you to attract people to your blog or website. Jagoinvestor as a blog started very small and with the love and trust of our readers it has now created a special space in investor’s community.
5. Advertisement hoarding on your building and terrace
If your building is on main road with proper visibility you can put some banners or hoarding on the terrace of your building or even in garden or open space of your building. If you own terrace rights the money will come to you otherwise, it goes to society kitty as passive income. Some permission & authorization is required to take this step.
6. Interest income from your investments
This is one of the simplest ways to create passive income, which is in everyone’s reach. You can either create interest income through Bank Deposit products or by offering loans to people at attractive interest rate. For this your need cash on hand or pool of money from which you intend to create interest income.
7. Dividends from Stocks and Mutual Funds
You can either receive dividends through Stocks or from different mutual fund schemes. This income depends on the performance of stock and mutual fund which is linked with market conditions. There are many people, I know who create good dividend income from stocks and mutual funds.
8. Royalty Income
Your talent can help you to create passive. You can put something in a book on Amazon Kindle and it can be shared with the world, your book can help you get royalty income. Most people are disconnected with their true talent which is not good for creating second income. You really do not need a publisher you can either self-publish it or get in touch with websites who promote new writers.
We started with one book and now we have four books which are written for investors and advisors, our publisher has already assigned us two more writing assignments.
9. Referral business model
If you are into business you can create a strong referral business model by which your overall business strength increases. Here with the help of referral model not only does your business expands but you also get an opportunity to create passive income as an entrepreneur.
10. Buy cars and give on rent to companies
Many BPO’s and companies hire vehicles on contract. Some people buy vehicles and they offer their vehicles to the company they work with. This helps them to create passive income out of it. Here you need to be careful about the terms and conditions and choosing right driver who will be handling your vehicle on daily basis.
Project called “Passive Income”
If you do not have passive income it means you have yet not created “passive income” as a project. In our book “11 principles to achieve financial freedom” you can learn more about creating passive income and how you can convert your dream of creating passive income into a project.
Just place your hand on your heart and ask yourself, “How many attempts in the past I made and I failed at creating passive income? (may be zero attempts). You are unable to create passive income because you are glued to the idea of only creating active income in your life. You haven’t failed much because you haven’t yet started fully playing for creating passive income.
Come on, make list of possibilities, make list of people who can help you, see what leverage you can get in creating passive income, see what best you can do with the resources you already have, what talents you have in you that can help you create passive income or take professional help, if required. In the last article of increasing income series we will have a strong completion and for what we invite you to share your key insights in the comments section.
This week action
Take a day off from your routine and name is as “PI day” (Passive income day)
Do some brainstorming and come up with ideas for creating passive or residual income. Do share one idea in comments section for creating passive income