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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 quicker. However, with some time, its potential to create enough passive income that you could quit your job or retire .

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

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

Exactly what qualifies as passive income is up for debate. Most lists which youll find online will include things such as blogging, writing e-books, or creating your own course. Im not including those thoughts in this informative article because, in my opinion, they all require an excessive amount of effort to be considered as passive.

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Blogging will constantly require on-going work, either by yourself or from others that youre paying.  Selling ebooks or classes will need on-going customer service, plus youll need a consistent traffic source in order to continue to create sales. It's possible and there are individuals who have been in a position to get it done passively, but they compose a small percentage of individuals who actually set out to get it done.

Ive been blogging fulltime for ten decades and Ive sold ebooks and classes in the past. Theyre great ways to earn money, I simply dont consider these to be passive, in most cases. .

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Just about any business can be a source of passive income when youre paying others to run the business. That is true with both online and traditional businesses. That opens up even more chances than that which will be listed here.

Now lets take a visit here look at some of the greatest ways to make passive income. A number of them are investments which will need some money to start with. Other folks wont require any money to begin. In case you dont have the money to invest now, consider starting with the approaches that dont require any money, and then use that money you earn to invest. .

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Your very first financial priority should be to build up an emergency fund that can cover all your living expenses for a couple months. But dont put this money is a checking 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 that will earn a much greater return for you.

My spouse and I home keep our emergency fund in a money market account with CIT Bank. At the moment (October 2018) CIT money market accounts are earning 1.85percent APY and CIT savings accounts are earning 1.55% APY. Thats 22x the national average! Opening an account with CIT is fast and easy, 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 let you own more stocks, which contributes to more dividends in the future (ideally).

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The companies that consistently pay dividends tend to be large companies with a long history of success. Because of this, these investments tend to be considered less risky than the stock exchange in general.

Dividend stocks can be a great investment regardless of whether you want to reinvest each the dividends on hold on to this stock for a long time, or make use of the income generated throughout the dividends.

For much more detail on the subject read Investing in Dividend Stocks at Investopedia. For a list of those stocks, visit 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 in recent years. Borrowers and lenders can be matched up through a site or marketplace. Instead of going to a bank, the debtor gets a loan from an investor.

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