Boosting your income without putting in substantial effort or time might sound too good to be true, but that’s the promise of passive income. Financial guru Dave Ramsey emphasizes that true passive income requires some upfront work but can generate money for years with minimal ongoing effort. Here’s a look at Ramsey’s top recommendations for building passive income.
1. Generate Income With Real Estate
Owning real estate allows you to earn rental income, but Ramsey suggests a cautious approach. He recommends paying off your own home first and then purchasing investment properties with cash to avoid debt. You don’t need to stick to investing in residential properties. Industrial properties often have higher capitalization rates, meaning greater returns after costs. Ramsey also advises investing locally and working with a property management company to simplify operations.
Pro Tip: Investing in real estate doesn’t have to mean buying property. Fundrise lets you invest in real estate starting with just $10.
2. Turn Your Hobby Into a Revenue Stream
Do you have a skill or passion others want to learn? Create an online course on platforms like Udemy, where you can earn money every time someone enrolls. Writing an e-book to sell on Amazon or posting instructional YouTube videos are other ways to monetize your knowledge. Your hobby can evolve into a steady income source with some upfront effort.
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3. Earn From Custom Product Designs
If you’re artistic, try designing products for sites like Zazzle or Teespring. These platforms handle printing and shipping while you earn a cut of each sale. Create unique designs for mugs, t-shirts, or posters, and let the platform handle the logistics. However, keep in mind that success in this space may take time. Many creators on these platforms report modest earnings, but others generate steady income with persistence and appealing designs.
4. Invest in REITs
If you like the idea of real estate income but want to avoid property management, consider real estate investment trusts (REITs). These trusts own and manage portfolios of income-generating properties, and you can invest by purchasing shares. REITs generate income through rent and property sales and offer dividends to investors. Publicly traded REITs are listed on stock exchanges, making them an accessible way to diversify your portfolio.
Pro Tip: If you’ve got $100,000 or more to invest, SmartAsset can match you with a fiduciary advisor to build a strategy tailored to your goals.
5. Grow Wealth With Low-Turnover Mutual Funds
Low-turnover mutual funds provide a passive way to grow your money over time. Managed by professional fund managers, these funds maintain a stable portfolio with limited buying and selling activity. This strategy can result in fewer capital gains taxes and long-term growth. It’s an excellent choice for those who want their investments to work for them without frequent management.
Start Building Passive Income Today
Passive income isn’t a get-rich-quick scheme—it requires effort upfront that can pay off in the long run. Whether investing in real estate or monetizing your skills, these strategies can help you earn more while focusing on what matters most. Start small, stay consistent, and watch your financial independence grow.
Source: Money Talks News
