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At first you may only be making a small amount of money passively, and you may even want to re-invest that money so that it compounds and grows faster. But with a few time, its possible to create enough passive income that you could quit your job or retire early.

Passive income can be a bit of a divisive topic. In general, passive income is any money you earn without putting in much work. The money will flow in without too much being demanded of you. In some scenarios it might be long-term recurring income, and in some other cases it could be short lived or inconsistent.

In some cases youll need to put in some effort up front, but then it wont need just as much effort in the long run when youre making the money.

What qualifies as passive income is up for discussion. Most lists which youll find online will include things like blogging, writing e-books, or creating your own course. Im not including those thoughts in this informative article because, in my own opinion, all of them require too much effort to be considered as passive.

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Blogging will constantly need on-going work, either by yourself or by others which youre paying.  Selling ebooks or courses will need on-going customer service, and youll need a consistent traffic source in order to continue to make sales. It is possible and there are people who have been in a position to do it , but they compose a small percentage of people who really set out to do it.

Ive been blogging fulltime for 10 decades and Ive sold ebooks and courses in the past. Theyre great ways to earn money, I just dont consider them to be more passive, in most cases. .

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Nearly any business can be a source of passive income when youre paying others to run the business. This is true with both online and traditional businesses. That opens up even more possibilities than what will be recorded here.

Now lets take a peek at a few of the best ways to produce passive income. Some of them are investments which will require some money to begin with. Others wont require any money to get started. If you dont have the money to invest now, consider starting with the approaches that dont need any money, and then utilize that money you link earn to invest. .

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Your first financial priority must be to develop an emergency fund that will cover all of your living expenses for a couple months. But dont put this money would be a checking account or savings account at a local bank that pays you a horrible interest rate. You can open a high yield savings account or money market account with an online bank which will earn a much better return for you.

My spouse and I maintain our emergency fund in a money market account with CIT Bank. At the moment (October 2018) CIT money market accounts are earning 1.85% APY and CIT savings accounts are earning 1.55% APY. Thats 22x the national average! Opening an account with CIT is fast and simple, and can be done online. .

Some companies consistently pay dividends for their shareholders. As a trader, you can re-invest the dividends to purchase more shares of the stock, or take the dividends in cash. Reinvesting will allow you to own more shares, which contributes to more dividends in the future (ideally).

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The companies that consistently pay dividends tend to be large companies look at this website with a long history of success. As a result of this, these investments tend to be considered less risky than the stock market in general.

Dividend stocks can be a terrific investment whether or not you want to reinvest all of the dividends on hold on to the stock for a long time, or use the income produced throughout the dividends.

For much more detail on the topic read Investing in Dividend Stocks at Investopedia. To get a list of these shares, see this collection from Dividend.com and this collection from DividendValueBuilder.com.

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Peer-to-peer lending (or P2P) is becoming extremely popular click for more info in recent years. Borrowers and lenders can be paired up through a website or market. Instead of going to a bank, the debtor gets a loan from an investor.

In some cases the borrower may not be able to qualify for a loan through a traditional bank. And in many cases the borrower gets a much better interest rate than they might get from a bank. As an investor, you can earn a great return as well.