6 Passive Income Streams That Aren't as Hands-Off as You Think
Passive income gigs tout easy money with minimal effort — just set things up and watch your bank account grow. The problem? Many of the passive income ideas you read about these days aren’t very passive, and often don’t provide much income.
While there are certainly some winning ideas out there, it’s worth being wary of jobs requiring more work — and being tougher to squeeze a profit out of — than you might think.
Consider These: 5 Best Side Hustles To Rustle Up This Fall
Keep Learning: 6 Low-Effort Ways To Make Passive Income (You Can Start This Week)
Here are a few gigs that frequently appear on “make easy money” suggestion lists, along with what makes them less than favorable options than you may have initially assumed.
1. Starting a Blog
For those who enjoy writing and/or have strong opinions about certain topics, writing regularly for a blog may feel more like fun than work. Startup costs are generally low, and there are multiple options for monetization.
The cons: Building an audience is no small feat, and many topic areas are saturated. Blogs need updating, and you’ll have to hire help if you’re unable or unwilling to handle those updates yourself. Building income through search engine optimization (SEO) or AI-focused generative engine optimization (GEO) can take months — if it is successful at all. Data shows that even after two years, median monthly income ranges from $500 to $2,000.
2. Selling an eBook
E-books have very high profit margin potential. Once your book is written, duplicating and distributing it is generally very cheap without printing or shipping costs. Authors can maintain full control of the product and sell through platforms of their choice. Some books are also passion projects, with authors truly enjoying the process.
The cons: Book writing is not a passive activity and may be extremely labor-intensive. Many authors forget about the need to market their book after it is e-published. It can be tough to find readers in a crowded marketplace. Plus, while you may have a bestseller in you, a recent Books.by analysis found 35% to 40% of self-publishers make less than $1,000 a year, and 10% to 15% don’t make anything.
3. Renting Out Your Car to Advertisers
This one comes closer to “passive” than most. In theory, you’re earning money just by driving and leaving your car parked where people can see it.
The cons: You may be required to drive more than you usually would, which could start to feel like work and add wear and tear to your vehicle. You may need different car insurance or permits. You also need to check your agreement carefully to make sure the money you earn is worth the drawbacks.
4. Buying a Laundromat or Vending Machine
Owning laundromats or vending machines offers a simple business model, the opportunity to scale if you’re able to turn a profit, and predictable cash flow. With modern machines able to accept cards instead of cash, you run less risk of theft and difficult accounting.
The cons: Machines break and require maintenance. Profitable locations can be difficult to secure. Startup costs can also be quite high, with laundromats ranging from $200,000 to $1.5 million. Getting started with a vending machine can run you $3,000 to $30,000.
5. Using Your Lockscreen To Advertise
It is possible to earn money by simply allowing companies to place ads on your phone’s lockscreen. Startup costs are also low.
The cons: Payouts are usually only a few dollars a month. There may be tradeoffs involving privacy and battery life. It’s also Android-only at this point, with no options for iOS.
6. Renting Out Your Backyard
People have been making money for years by renting out their backyard spaces, allowing people to host events, run their dogs, conduct photo shoots and more. Startup costs are low, and you don’t need any specialized skills.
The cons: You need to be OK with having strangers in your backyard. There may be issues with liability, noise, local regulations and cleanup. Plus, you need to manage bookings and deal with guest issues.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
More From MoneyLion: