7 PASSIVE INCOME IDEAS (easily make $200/day)
If you want to diversify your income and create considerable financial security, then passive income is a great way to do this.
Before we get going, however, I want to clarify that passive income doesn’t come easily, and it’s not a get-rich-quick scheme that you don’t have to put any effort forth to produce momentum. Creating passive income takes work, especially up front, but the potential long-term gains make the work worth it.
What’s the best way to create passive income? Is it creating courses or membership programs, publishing books, dropshipping, building and selling a business, or investing your savings into stocks?
You can diversify your income in many different ways, but I want to share with you the 7 best passive income options that are easy to start and that can make you at least $200 a day.
#1 – Membership site
About four years ago, after building my audience through my YouTube channel, I launched my first membership site (Startup Society) to help entrepreneurs start and grow their online businesses, and 300 people initially signed up!
The cost for founding members was $33 a month, and with those 300 signups, I instantly began earning $10,000 per month with this passive income option.
Membership sites vary in structure and content, and people pay for education about a specific topic or to be a part of a specific club. Members pay subscription fees each month to continue to have access to the site’s content or community features.
On average, a membership site will typically bring in between $5-250 dollars a month per member. I know that is a wide range, but it can largely depend on the educational topic, member transformations, and how hands-on the community is.
Many are intimidated to go this route because they feel as though it isn’t a passive option. Yes, you do need to maintain your site, and you do usually have a more hands-on connection with the members, but that doesn’t mean you’re spending hours each day inside the membership site itself.
You also do not need to create new content every month for your membership. What you need is to create a select amount of quality content that your members can utilize to solve their specific problems you promised to help them with.
It can take upwards of a year to go through stand-alone course content, so you don’t have to worry about bogging down the membership with new content all the time. Some creators effectively pair their stand-alone courses with a community to create a successful membership option.
Here are 3 components that create a successful membership platform:
- Have a clear and specific value – What specific topic are you teaching on, or what is the transformation members can expect? Make sure your membership content is not too broad or diverse so members aren’t confused about the outcome they will receive by joining.
- Set up a process to sell – How are you going to sell the membership site? What kind of automated sales funnel do you need so you can make it more passive and not have to do all the work all the time? Selling one-to-one can be a great initial way to market, but if you want to create a more passive-style income, you need to have an automated sales funnel to do a bulk of that marketing work for you.
- Create a traffic source – What will you do to fuel the automated sales funnel you set up? How will you get traffic and leads into that funnel so you can make sales and create income? My traffic source of choice is YouTube, but you have additional options including social media, podcasting, and blogging.
If you create a membership site that costs $100 a month, you would make $6,000, which would be $200 a day grossed. Now, with that same membership site, if you had 100 members, you’d gross around $10,000 a month, which, once you subtract your expenses, your net profit would be around $200 a day. There is power in membership groups!
#2 – Royalties
Royalties are best-known in the music industry. Music artists receive a sum of money for purchases of their songs or albums. Essentially, they create one song or album one time and get paid long-term for it. This is how musicians produce passive income streams for themselves without always having to actively create income touring the country.
This can be the same for you! If you create an ebook, for example, and publish it on Amazon, you will receive between $1-10 every time someone purchases your book.
Years back when starting my online entrepreneurial journey, I wrote a book called “Sorted,” which is about organization and decluttering strategies, and I had no audience at the time – but it still pays me to this day.
Here’s a breakdown of what I did to create this passive income stream:
- I wrote the book in a month (yes, it’s possible!)
- I leveraged free Facebook groups to give my book away for free during the first three days of publication.
- I sought out individuals from those groups who would like to be a part of my launch team to help promote my book.
- These strategies helped my book move to #1 in a specific category during the free promotion.
- Once the book moved from free to paid, Amazon was already promoting it, and I sold a few thousand copies and made several thousand dollars in royalties.
- I continue to sell it every month and earn roughly $2-5 for each copy that sells.
I spent about two months creating and promoting my book, which was hard work, but now I’m hands off collecting royalty checks each and every month.
#3 – YouTube
As you most likely know, this is one of my favorite ways to create passive income. YouTube pays creators for ad clicks that are driven by the creator’s videos. How much you can make is calculated by the CPM, or cost per mille, which is an average amount you’re earning per 1,000 views.
On average, creators can make anywhere from $1-50 per thousand views, and most creators see roughly $5-20 in ad revenue per thousand views. I typically make around $10 per thousand views.
So what does this look like exactly? Here’s how you can calculate it on your favorite YouTube channels. Take a specific video, look at the view count, then divide that view count by 100, and that is roughly how much money that video creator has earned on that one video from ads.
Ad Revenue Calculation:
Total Video View Count / 100 = Average Ad Revenue from Video
Now, this doesn’t come easy, that’s for sure, but it’s VERY doable! It takes me about 5-10 hours to make each video, but now, every single month, I am earning $6-10,000 in royalties from current videos and ones I created years ago.
YouTube does take time to monetize, as you need 1,000 subscribers and 4,000 hours of watch time before you can apply to have paid ads on your channel. It is a fair amount of upfront work where you’re creating, creating, creating, but getting paid very little or nothing at all. However, if you stick with it, you can reap rewards from that hard work in the long run.
Did you know that only 17% of YouTube video creators are monetized? This doesn’t have to be a bad thing! It means that with the right strategy, you can get your channel monetized in as little as a few months.
I have a free workshop where I share the strategies I’ve used and taught (that work) that can get your channel from start to monetized in as little as three months. If you’re interested in learning more about how to leverage YouTube for your passive income creation, then register for my free workshop:
#4 – Podcast or blog
You can also leverage a podcast or blog to grow passive income, and I lump these together because they earn revenue in similar ways. Neither earns money on its own in a way that YouTube can. Rather, you need to decide how you want to monetize these platforms with products related to the content topics you are sharing about.
Here are some ideas for ways to monetize a podcast or blog:
- Sign up for an ad program such as Google AdSense – With ads, you would get paid per-click, which is similar to ads on YouTube, but it takes a bit more effort to set it up on your website.
- Find sponsors – With sponsorships, you would work directly with companies that pay a fixed rate each month to place an ad on your site or within your podcast episode. In order to continue working with you, though, they will need to see a benefit in their own business.
- Consider affiliate marketing – As an affiliate, you would be promoting other people’s products on your site and earn a commission per sale.
- Promote your own paid products – You can create a multitude of products related to the free content you share about, such as PDF downloads, courses, or memberships.
#5 – Digital products
You may think that the market is overly saturated with digital products and you’ve missed the boat, but that just isn’t true! The online market is still developing and growing, and products are getting better and better. If you create a quality digital product, you have every reason to believe you can make it a success.
Right now creators are making upwards of 8 figures selling digital products, ranging from PDFs, planners, courses, and more that you can download to use or learn from.
How you market your digital products matters if you’re looking to create a more passive-styled income.
If you don’t create an automated sales funnel that you can leverage your time with, you will be selling in a more one-on-one style, and that is a ton of effort and not passive-income friendly. You will exchange dollars for hours rather than having the dollar work for you. Starting out with a more 1:1 marketing approach is a smart idea, but doing this for the long run will burn you out.
What are some ways you can market effectively?
- Utilize public marketplaces to sell your product such as Etsy, Udemy, or Skillshare – when you have little to no audience, this can create instant visibility, as these marketplaces are more of a search engine and produce more eyes on your product.
- The downside? You can’t charge as much on public marketplaces because people are constantly comparing products and pricing.
- The upside? This takes a lot less of your time when it comes to marketing because these platforms are well-established already.
- Build an automated sales funnel – If you have an automated sales funnel working for you, then you can focus your attention on traffic generation strategies, such as paying for ads to bring in traffic or creating quality content through YouTube, podcasting, or blogging. Here are some videos that can help you out with creating an automated sales funnel:
- How to Plan an Insanely Profitable Sales Funnel
- How to Create a Sales Funnel for FREE
- 4 Systems to Take You To $100,000 and Beyond
- Deconstructing My $72,000 Sales Funnel
#6 – Affiliate marketing
If you’re interested in promoting other people’s products and earning a commission from that rather than creating and selling your own, then affiliate marketing is worth checking out.
Most content creators will pay you 30-50% commissions for each sale you create for them. However, like most things that sound too good to be true, this can be a hard route to go. Can you earn great commissions? Yes! But it doesn’t come without the hard work of setting up your marketing process because, in order to make it work, you need a fair amount of traffic and some experience in sales.
The only way to make affiliate marketing a more passive option is to ensure that anything you offer your audience fits what you’re already teaching about, and you want it to easily fit into your content creation. Make sure that the products you choose to promote as an affiliate is a great option for your audience with a great transformation.
Pat Flynn is a good example of someone who creates passive income through affiliate marketing. One of the softwares he promotes is Bluehost, and he consistently earns $40,000 a month with that one affiliate.
Is affiliate marketing viable? Yes, if you’re willing to do the upfront work to create your own sales and marketing strategies to promote others’ products to your audience and leverage your own content creation to do so.
#7 – Investing
The last passive income stream I want to talk about is investing. I left this one for last because investing takes initial capital to start, but I kept it on the list because this type of income stream is much more hands off and takes a lot less effort to put in place and run.
There are so many different ways to invest including real-estate, precious metals, cryptocurrency, or even existing businesses.
If you were to invest in an existing business, there are a few ways to do so:
- You can invest in the business directly
- You can invest in individual stocks within the company
- You can invest in index funds, which means you are investing in a collection of stocks to give you a taste of many different sectors of the market – this helps you instantly become diversified in your income)
If you choose to invest in the stock market, you could see an average of 10% increase each year (depending on the economy, any given year could be more or less). Over time you would need around $730,000 invested in order to earn $200 per day, but your money would also be tied up in the stocks, so that $200 would not be as usable.
Now, if you went the direction of investing in dividend-paying stocks, then you would receive payouts from the company profits each year that you could use as passive income and potentially live off.
The bottom line with going the investing route, though, is that you need money to make money. You need an initial chunk of capital to invest.
I recommend that you layer in different passive income strategies that we talked about today and see your passive income compound over time.
Some of these strategies involve content creation, such as a blog or ebook, but you can leverage that content to throw out a larger net and build your audience. Some of the strategies involve more selling tactics and don’t grow your audience, such as a digital product or membership site.
You can build an entire business that creates passive income in many different ways:
- Use small amounts of your day job paycheck to help you get started creating a YouTube channel or podcast.
- Add in ad revenue from YouTube or sponsorships on your podcast.
- Use that content to promote your own products or affiliate products.
- Then you can use some of that disposable money to invest in the market.
Think about where you’re at and decide on the first type of passive income you want to create. If you want help, check out my membership program Startup Society where I teach you how to build an online business that generates passive income 24/7 – it’s not easy, but it can be simple!