Passive income is income that you receive on a regular basis without having to work just as regularly to get it. By definition, passive income doesn’t require a lot of follow-up to produce this constant cash flow, but that doesn’t mean it’s easy to get. In fact, it is necessarily the result of an initial investment and a lot of work upstream to make it profitable.
When it comes to generating passive income, you must therefore start by stimulating the market first, and then take care to maintain it. The second step is less tedious and requires little time and resources, which is why the word “passive” is used. But above all, it is all about finding THE passive income in which to invest.
Real estate investment and online business are among the most popular sources of passive income today. I’ll go into more detail in the rest of this article.
Why is real estate rental investment so popular?
Real estate is the most promising sector for passive income. Indeed, investment in stone is prioritized by the French for many good reasons:
A safe and efficient investment
Real estate remains a safe investment when we know that in France, there is a shortage of more than 150,000 homes per year! Moreover, the value of real estate tends to increase over time, provided that the market has been well studied beforehand. The real estate allows in particular to obtain really passive incomes since once the steps of purchase and hiring carried out, it only remains to collect the money every month!
A secure investment
Real estate investment offers the advantage of being accessible to all, in the sense that it does not require any particular skills, apart from the initial capital to be invested, of course. By investing in real estate, you kill two birds with one stone by building up your assets while making them profitable. This wealth can then be used as you wish: home, inheritance, renting to relatives…
Investing in an investment property
Rental property investment also allows you to choose from various possibilities such as the rental of investment property, which will allow you to buy a lot of buildings at a low price. The return on a investment property is optimised thanks to a low management cost and the possibility of spreading the risk over several lots. You also have the option of delegating the tasks related to the management and leasing of the property to a professional in order to optimize the return. This is very practical if you have several other activities to manage.
Among these possibilities, I can also quote you the seasonal hiring which is a good way to make profitable the free rooms of your house, or even your studio of garden during the periods of holidays. By registering your property on the dedicated platforms, you will ensure that you will find tenants as soon as the annual holiday periods approach.
Investing in SCPI is also an excellent source of passive income. Find out more about it in this article.
The investment can be financed by borrowing
Real estate investment offers the advantage that it can be financed by borrowing, which makes it easier to access. Banks and other financial institutions are indeed more inclined to grant loans for this type of financial investment because it is considered profitable and secure. You have the possibility of repaying part of your home loan thanks to the rents you receive, and in the end, you are a winner since you remain the sole owner of the real estate assets.
The law encourages investment in rental property
In France, it should be noted that the investment of private individuals in rental property is strongly encouraged by the State. Tax provisions such as the Pinel Law allow people who invest in rental real estate to benefit from tax advantages.
Since the democratisation of internet use, the internet has become a real financial windfall for entrepreneurs and individuals who wish to build up passive income online.
Here is a non-exhaustive list of existing solutions.
The creation of a blog
Creating and maintaining a blog requires a certain investment of time at the outset. But once it is monetized, it can be an excellent source of passive income. Among the monetization solutions that can generate this type of income, I can only recommend affiliation. The concept of affiliate marketing is quite simple:
- You promote branded products or services on your blog or social networks.
- People click on these links.
- If they buy, you receive a commission.
So all you have to do is set up a marketing system for visitors to click on your affiliate links.
You can also publish sponsored articles for which you will be paid. The more your site gains notoriety, the more you can expect to be paid.
Mobile application creation is a solution that web developers can implement to earn passive income online. To do so, you obviously need to create an application and then offer it for sale or for free on application sales platforms. If you opt for a free application, you will get a source of passive income through advertising.
The design and sale of online courses is increasingly popular as a means of collecting passive online revenue. This concept consists of creating courses in the form of a video, e-book or tutorial to be made available to Internet users under the condition of registration. Each time a customer buys your course, they will automatically receive all the material you have planned.
For your part, you will receive a sum of money for the price of the course you have designed. Attention! I would like to make it clear that this is not easy money. If you want your course to sell well, it will have to be of quality, and you will have to implement a strategy beforehand that will allow you to promote it to the public.