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

Passive income can be a bit of a divisive topic. In general, passive income is any money you make without putting in much work. 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 could be short lived or inconsistent.

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

Exactly what qualifies as passive income is up for debate. Most lists which youll find online will include things like blogging, writing e-books, or creating your own course. Im not including those ideas in this post because, in my own opinion, they all require an excessive amount of effort to be considered as passive.

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Blogging will constantly need on-going work, either by yourself or by others that youre paying.  Selling ebooks or courses will need on-going customer service, plus youll need a consistent traffic supply in order to continue to create sales. It's possible and there are people who have been in a position to get it done , but they compose a small percentage of individuals who really set out to do it.

Ive been blogging full-time for 10 decades and Ive sold ebooks and classes in the past. Theyre great ways to earn money, I simply dont consider them to be more passive, in most cases. .

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Nearly any business can be a source of passive income if youre paying other people to run the business. That is true with both online and traditional businesses. This opens up even more possibilities than what will be recorded here.

Now lets take a look at a few of the best ways to make passive income. A number of these are investments which will need some money to begin with. Others wont require any money to begin. If you dont have the money to invest now, try starting with the approaches that dont require any money, and then utilize that money that you earn to invest. .

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

My spouse and I keep our emergency fund in a money market account with CIT go to my blog 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 quick and easy, and can be done online. .

Some companies consistently pay dividends to their shareholders. As a shareholder, you can re-invest the dividends to buy more shares of the stock, or take the dividends in cash. 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 history 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 each of the dividends on hold on to this stock for a long time, or make use of the income produced throughout the dividends.

For far more detail on the subject read Investing in Dividend Stocks in Investopedia. To get 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 matched up through a website or market. Instead of going to a bank, the debtor gets a loan by an investor.

In some cases the borrower might not be able to be eligible for a loan via a traditional bank. And in many circumstances the borrower gets a better interest rate than they could get from a bank. As an investor, you can earn a good return too.