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After getting laid off from my full-time job in 2015, I decided I’d do whatever it took to be my own boss. While that meant growing my side hustle into a business and taking on more freelance gigs, it also meant finding ways to make passive income every single month.
At the time, and even now, the idea of owning a rental property was out of the question, though it was one of the top ways I’d heard of to earn passive income. I didn’t have the cash to invest in buying a home, and I didn’t have the time to manage a rental property. I knew I had to find other ways to make the idea of passive income come true.
The thing about passive income is that it fluctuates. Some months I make more money in passive income than I do from my business or freelance jobs. Other months, I hardly make enough to cover my grocery bills. Because of that, passive income has to be just one of the many ways I make money every month.
Over the years, I’ve found a handful of ways to bring in anywhere from a few hundred dollars to over $1,000 in passive income every month. Here are the five ways I’m doing that.
1. Making my money work for me by earning interest
The first time I heard a friend use the phrase “you have to make your money work for you,” my ears perked up. I had no idea what that meant or how to make it a possibility. But I learned that an easy way to make passive income is to be smart about where you’re storing your money.
One of the best ways to do this is to choose a high-yield savings account with a high interest rate or lock some funds in a fixed-rate certificate of deposit that can provide a higher interest rate for your chosen term (for example, interest rates are typically higher if you pick a two-year or five-year CD over a six-month term).
I moved my cash from a savings account that had a 0.01% interest rate to one that offered 1.6% (though it has since fallen). This helped me earn compound interest every month, allowing the cash in that savings account to grow. In five years, my fiancé and I earned about $15,000 in interest combined on our high-yield savings accounts.
Earlier this year, I put a chunk of cash into a 12-month CD with a 1.6% interest rate. That was a good move, considering interest rates have fallen dramatically since then.
2. Sharing my skills through online courses
After spending years teaching workshops for different companies and doing one-on-one coaching with people who hired me to consult with them on their business plans or personal brands, I decided to package up my knowledge and skills into online courses.
These courses range from $99 to $150, make them affordable options for people to buy if they want access to working with me but might not be able to shell out the cash for a one-on-one session.
Offering these courses takes a lot of effort at the start (you have to design the course, plan it out, and record the videos), but once it’s live, and you have a solid marketing plan, people discover the courses and sign up on a monthly basis. Once a user signs up to take the course, there’s virtually no work to do on my end, making that income passive and ongoing.
3. Using affiliate marketing
Another strategy I’ve tapped into — that brings in less than $100 a month but still brings in passive income — is an affiliate model.
For example, signing up with Amazon’s affiliate program or a popular one for lifestyle bloggers, RewardStyle, allows you to earn a percentage of each sale. I’ll often share books I’m reading with my email subscribers and use my Amazon affiliate link when I link to the product. If they click this link and decide to buy the product, or anything else during their shopping experience, I’ll make a percentage of that purchase.
While this brings in the least amount of income for me of any of the other strategies, it’s scalable as my audience and content strategy grows.
4. Selling e-books
One strategy I’ve used in the past to make passive income is to sell downloadable e-books on topics that my audience is interested in. I’ve sold these books on my business website and personal website for about $15 to $30. Customers opt in for this lower-price item (as opposed to courses or coaching), and that leaves me room to upsell them in the future.
The other benefit of an e-book is that once you spend the initial time writing it and putting it together, there’s virtually no other upkeep. Once people find the book and buy it, you’ll earn passive income.
5. Investing in dividend-paying stocks
A new strategy I’ve turned to recently is investing in dividend-paying stocks. These are companies that pay out regular dividends and usually well-established companies with a track record of providing earnings to their shareholders.
I’ve decided to invest in stocks with a dividend yield of 3 to 5% annually. Because I don’t have a lot of money invested in these stocks, it’s not likely I’ll bring home much money in dividends every year, but every little bit of passive income is important to me for now.
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