But I hate the very idea of how the “kick back and do nothing” business opportunity is sold. *Residual* income and *Passive* income are not the same, so I agree with you there. I’d love to see a series that goes more in-depth into what kind of work each type of digital business needs, a kind of fantasy vs reality thing. (Mostly so I could have something to send to people when they ask me, as I’m not in business.)

Another drawback of residual income is that future income payments are often not guaranteed. If you spend a month building a website to generate residual advertisement income, the actual amount of income you make can fluctuate over time and it may fall if the traffic to your site declines over time. Similarly, companies can slash their dividends and tenants can move out of rental units, which can decrease passive income. With earned income, you get a certain amount for your services up front so you don't have to worry about future earnings.

If your research really does determine that there is some amazing market niche that until now has miraculously gone unnoticed and unserved---dog owners who wish to help their dogs lose weight naturally, for example---sooner or later, word is going to get out that there's money to be made there, and someone is going to create a better ebook or info course or product that serves that market's needs better than yours does, and who markets it better to them than you do. You can't manage this competition while sipping margaritas all day from your paradise restaurant on Fiji. You'll soon see your market share go down the drain---just like all those Açai cleanses. . .
Logan is a CPA with a Masters Degree in Taxation from the University of Southern California. He has been featured in publications such as Debt.com. He has nearly 10 years of public accounting experience, including 5 with professional services firm Ernst & Young where he consulted with multinational companies and high net worth individuals on their tax situations. He launched Money Done Right in 2017 to communicate modern ideas on earning, saving, and investing money.

This can be a little easier said than done, but if you have a large social media following, you can definitely earn money promoting a product or advertising for a company. You can even combine this with different marketing campaigns if you are an influencer and have your own blog (advertisement + affiliate income). This is how many bloggers make money! Again, it is not 100% passive but once set up correctly and then scaled, can be surprisingly lucrative.
I no longer count traditional publishing as passive income because after you’ve spent half a dozen years pitching agents, arguing with publishers, and having your heart broken repeatedly only to make about a dollar per book, it’s not really passive income. More like overdue income. The responsibility that traditionally published authors shoulder is much too high and the cut far too little to make this even a profitable, let alone passive, income option for most writers.
A very thoughtful list here. Another relevant book published this year is “Retirement Planning for Young Physicians” by Dr. Ralph Crew. It covers many of the topics discussed here from the perspective of a physician who has successfully saved and retired. The book adds a lot to these discussions with a focus on the importance of lifestyle choices, as well as a realistic (though sobering) view of likely future physician income trends and how to plan accordingly for retirement.
On August 4, 2003, Brad and Karen Murray’s marriage ended. They continued arguing over their assets for another four years. Brad worked as an independent broker for Ameriplan – a marketing company specializing in providing discounted rates on services related to healthcare. As part of his job, Brad sold monthly memberships to Ameriplan’s discounted health plans. He also recruited other brokers to do the same.

Even if each patron only contributes a very small amount each month, it can still be a huge source of income. Take a look at the Patreon page for Kinda Funny, an internet video company. They have over 6,209 patrons which means an average of just $3 a month would be a monthly income of almost $19,000 – plus they get cheerleaders that are always happy to spread the word on their brand.
Draft your first five posts. I like to have a few posts ready at launch time for a new blog. Do not write a generic "welcome to my blog" post to kick it off. Blah. What does that really offer? Nothing. Put up a temporary post if the site is up pre-launch if you want to build some anticipation, but if you're ready for launch now then get right down to business.
A very thoughtful list here. Another relevant book published this year is “Retirement Planning for Young Physicians” by Dr. Ralph Crew. It covers many of the topics discussed here from the perspective of a physician who has successfully saved and retired. The book adds a lot to these discussions with a focus on the importance of lifestyle choices, as well as a realistic (though sobering) view of likely future physician income trends and how to plan accordingly for retirement.
Obviously, these are much higher than you’re going to get with most other investments. What’s more is that you can choose a plan that matches your investment strategy, whether your goal is Supplemental Income, Balanced Investing, or Long-term Growth. You can also look at different real estate projects and choose for yourself which ones to invest in.
If you are good at Mobile app development, or perhaps you are an experienced welder, you can create educational videos and articles, and even teach a whole class by signing up to websites that offer such services. Making an online course is no easy task, however quality content and a little effort can make your course several hundred dollars worth, so it might be a good idea to consider.

I know, not another piece of carefully written marketing jargon and I won’t give you some killer sales line. But truth is, I worked this out the hard way too. I started building my own online businesses to earn passive and you are not wrong it is bloody hard work! More than even I as a full time hustler never thought would be so hard, but alas it is.
I have posts that are heavily linked to Amazon and some that aren’t to keep things balanced out. My heavily linked posts are product guides or stuff I was searching for my kids. Some examples are: Non-toxic high chair, 20 non-toxic teething toys, and Gift for 2-3 year olds. My blog is “green” so a lot of my posts are about non-toxic products since this is what I personally look for.
I would like to add, that one of the main reasons why you cannot leave your web properties unattended, is Google. Even for popular content, with time Google sends fewer and fewer visitors your way, if you stop pruning and updating it. There hardly is such a thing as “evergreen content” any more. If you do not update your existing content, you have to keep adding some new content, preferably — every day. That’s where the content-creation plugins with some automatic pre-scheduling capability come in very handy.
ABC International has invested $1 million in the assets assigned to its Idaho subsidiary. As an investment center, the facility is judged based on its return on invested funds. The subsidiary must meet an annual return on investment target of 12%. In its most recent accounting period, Idaho has generated net income of $180,000. The return can be measured in two ways:
Another way to add a course to your WordPress site is LearnDash. This full-fledged learning management system (LMS) offers tons of features for setting up any kind of online class you can imagine. Create certificates of completion for your students or run your class based on a point system. Offer multi-tier courses complete with topics, quizzes, and more. Leave comments on and approve submitted assignments. too.

The Automatic Millionaire – I randomly found it in a used bookstore years ago and decided to check it out. Little did I know that it was a #1 bestseller and still well read today. I found it was an easy read and gained some valuable ideas from it. The first is that you need to “Pay Yourself First” meaning don’t invest what you have at the end of the month after all your expenses are taken out. Set aside what you’re going to invest first, then the rest of your budget should adjust to that. And then like the title suggests, automate your savings and debt payments and that will put you on the right path to being wealthy.
What if the manager of the Idaho investment center wants to invest $100,000 in new equipment that will generate a return of $16,000 per year? This would provide residual income of $4,000, which is the amount by which it exceeds the minimum 12% rate of return threshold. This would be acceptable to management, since the focus is on generating an incremental amount of cash.
Another benefit of residual income is that, if the income stream is large enough, one does not need the main focus of his life to be on making enough money to survive. Having a comfortable and continuous level of residual income opens up more opportunities to travel, look into other business opportunities, and even take the time to indulge in his hobbies.
My advice for beginners – especially beginner bloggers with new sites – focus on your site content and traffic for a while, then add your Amazon links once you have a little traffic. So many beginners focus on making money from their links and sacrifice their content building in the process. Without good content and traffic you won’t make much anyways.

There are other ways to earn from your blog. For example, you could sell banner advertising. You could survey-based cost per action -- CPA -- ads (you're paid when users fill out a survey or complete some other action). You could sell video ads. Yo and I are launching FreelanceTheater.com soon, and we might eventually sell jingle ads or other audio ads in the audio plays there. Get creative and brainstorm some possible income streams for your blog that would work with your niche. There's a reason you won't see a lot of banner ads or even contextual ads here at AFW. Years of testing told me that they weren't the best ways to monetize a site targeting freelance writers. That testing also demonstrated that far better options were to incorporate job lead based income streams and promoting my own products for sale here. Don't simply assume the easiest option will be the right one for you.

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Another variation of this model is to pay for advertising and then earn affiliate commissions from people who click on the ads. Years ago, when advertising on Google and Facebook was cheap, lots of people made a lot of money this way. Nowadays, it’s still possible, but it’s much more difficult, and you have to be much more sophisticated. Nevertheless, I thought I would mention it, because it’s still a viable approach, especially in certain niches.
I know subscriptions are a litttttlleeee controversial but hear me out: bloggers like ElephantJournal have been super successful using Wall Street Journals approach of providing 3-5 posts a month for free and then asking for a small subscription fee. This one is worth thoroughly A/B testing though, because if it impacts your session depth and overall pageviews, your display ad revenue will take a hit.
I simply loved this post. I am new to online business and earlier when I went through many blogs and articles, the writers all made it seem so simple and that I would get a huge income passively in a month! But now when I have started business, I realized its too tough. Its totally a different world. Sometimes its so frustrating and depressing that I feel like going back to my old office job. Atleast I had fixed income rolling in my bank. But when I think about the bad times I had in office for doing the work that I did not like, I find online business appealing as i am doing what I want to do and what I am skilled in! But till the time, I dont earn any revenue, I am at a loosing side. I want to work hard. I want to understand all these SEO techniques and all the referral programs but that makes me lost. Its too much to do! And its all about traffic! Trying to hold on tight!
In my case, I tried leaving the site in “automatic” mode a few times, when I did not have the motivation to post anything new. I found that my traffic, then my revenue, quickly tanked to half of what it should be. So far this has been motivation enough for me to keep writing, when nothing else would keep me motivated. But I have no reason to believe the “passive” part of the revenue would last more than one year. I can imagine revenue progressively going down, until it does not even pay for the server costs anymore.
Most workers earn income by performing tasks and receiving compensation from an employer or a client paying for services. Earned income is compensation made through active work that results in an immediate payoff. Residual income, also known as passive income or unearned income is money you receive periodically that does not require constant active effort. Passive income has several notable advantages and disadvantages with respect to earned income.

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For those who prefer a more do-it-yourself style but still want their investments to be managed automatically, a robo-advisor like Betterment may be better suited. After completing an initial questionnaire, this program will automatically invest your money based on things like your risk tolerance and time horizon. They’ll even rebalance your portfolio when necessary – all automatically, of course!
The second big takeaway for me, was to pick a niche you know, you find interesting AND where there is demand for your product – ie willingness to buy/pay.  A lot of people only remember the first part of this 2-part formula, and end up creating a blog on knitwear for kittens.  But it’s the overlap of passion and profit that Ferriss stressed so much.
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