2020 has been a tough year, especially for small businesses. We have all had many eye-opening realizations about financial stability. And the most prominent one would be the fact that relying on one income stream is not an option anymore.
To survive and thrive in the post-COVID19 world, having multiple income streams has become a necessity. For small business owners, building a couple of passive income streams can ensure that your business can stick through the toughest times too.
When the times are tough, passive income streams can help you fund your small business, with almost little to no effort. In this article, let’s see some of the top passive income ideas that will support you during these unprecedented times.
What is Passive Income?
Passive income is the process of earning money from a business in which you aren’t actively involved anymore.
Many people mistake passive income for money that is earned from get-rich-quick schemes. That is not true. It cannot magically help you earn money instantly. Otherwise everyone today would be successfully owning multiple passive income businesses today.
Most passive income streams involve you putting in the initial hard work for weeks, months, or even years before it turns into a consistent passive income stream. Or, in the case of investments in rental properties or shares, you need to invest time and money to turn it into a passive income stream.
Passive Income Ideas for 2021
Let’s look at some of the top passive income ideas that are most suitable for small business owners in 2021.
1. Sell Online Courses
The eLearning market has been booming ever since the pandemic outbreak. Since everyone is stuck at home, more and more people are investing in online learning. So, why not make this your passive income idea?
As a business owner, you must be an expert in an area or two. You can easily monetize your expertise by creating and selling online courses. You can use platforms such as Udemy or Coursera, or you can even sell online courses on your website.
The idea will need an initial investment of time and money in creating high-quality digital courses. But once the course picks up, you’ll be earning a consistent passive income on the side.
2. Invest in Peer-to-Peer Loans
Using investment marketplaces such as Swaper, you can invest in peer-to-peer loans for other consumers. This idea will require an upfront investment from you. But you need not be actively involved in the process as the platform offers you auto investment options too.
Investing in P2P loans can be a great way to earn a significant income on the side to help you generate steady income to fund your small business during uncertain times.
3. Affiliate Marketing
Affiliate marketing is a great passive income idea as it involves earning commissions by promoting and selling others’ products. So, you don’t have to put in the efforts to create your own products. You can simply sell others instead.
Affiliate marketing can be a great option especially when you have a website with consistent traffic or a good digital following.
4. Sell Digital Products
Selling digital products is, again, a great way to generate steady income after you put in the initial hard work. Since there is no active inventory and physical shipping involved as in the case of physical products, the income turns passive after some time.
Your digital products can be ebooks, guides, templates, or even mobile apps. You can also sell audio tracks or professional stock photos, and generate royalties for them.
5. Create and Monetize a Blog or a YouTube Channel
Creating blogs and producing YouTube videos is one of the best options to generate a significant amount of passive income. Lots of people today, earn 6 and 7 figures through these ideas.
Unlike the other options, the kind of hard work and time required here will be much more. But, the potential to generate a significant amount of income is the highest here.
6. Invest in Real Estate
Real estate investments are one of the oldest forms of generating passive income. The initial investment will be expensive, but if you’ve got the money, then this is definitely a good option.
A downside of real estate investing is that it will go down if the economy is not good. But if you are ready to be patient and wait for the industry to get back, then nothing like this kind of passive income.
7. Rent out your Car
If you do not have the capital to invest in a rental property right now, you can rent out your car through apps like Turo.
All you need to do is some initial set up and you are good to go. Instead of simply sitting in your garage, your car can make some passive income on the side. This idea is a no-brainer and you can use this as your second or the third passive income stream alongside others.
To conclude, we can say that after the outbreak of the pandemic, relying on just one income stream is not the best idea.
If you are worried about your small business going into a loss, plan for it beforehand by building at least a couple of passive income streams that can keep you going even during the tough times. Use the ideas in this article to start working on your passive income idea.