Earning Passive Income on the Internet

You’ve probably heard the term “passive income” before. But what is it? Well in this post, we’re going to briefly talk about passive income and a few ideas for getting started.

A Definition of Passive Income

If you’ve ever seen those late-night infomercials about making money with real estate then you’ve seen an excellent example of passive income.

It’s actually a fairly common practice— people own homes where they do not physically reside, only to rent them out to tenants for a fee each month.

It’s safe to say that for the most part, landlords earn an income from the rent received without doing anything to earn it (until some crazy disaster strikes at the rental property and they have to go in and take care of it, of course.)

The IRS categorizes income into three main types: active (earned) income, passive income, and portfolio income.

To keep things simple for this blog, let’s just say that any money that crosses your palm without really doing any work to receive it (like the example of collecting a rent check each month from a tenant) is considered to be passive income.

There are many other forms of passive income out there besides home rentals.

Musicians usually earn royalties for each copy of their album that is sold, and writers generally earn a royalty for each copy of their book that’s sold.

Internet Opportunities for Passive Income

Obviously, most of us aren’t famous rock stars or authors on the New York Times best-seller lists, but there are several opportunities for the average Joe to earn money passively, particularly from the Internet.

Yes, the Internet — the same Internet where you waste time watching YouTube videos, forwarding junk emails to your friends, and looking at photos of your high school buddies’ kids on Facebook.

As you sit here reading this blog on the Internet, you could be earning money.

My Experience with Passive Income

In 2003 I got sick and tired of participating in the old “9 to 5” grind. I’d wake up early in the morning, drive an hour each way in bumper to bumper traffic, and spend 10 hours at a job I hated. In my opinion, this wasn’t a way to live my life.

So after a lot of trial-and-error over the last seven years I managed to create a couple of income sources which we are almost 100% passive. (I consider working 5 hours a week to be pretty passive.)

No “Get Rich Quick” Schemes

Passive income doesn’t mean you’ll become an instant millionaire. Obviously starting a business takes some effort.

Many people struggle at first.

But after the wheels start turning, the passive income you’ll earn (without really doing anything to earn it) can became more than the paychecks you receive from a ‘real job’.

Maybe this can help you leave the “rat race” once and for all?

This is what happened to me, too.

And it can happen to you.

Affiliate Marketing is My Passive Income

The easiest way (in my opinion) to earn passive income with the help of the Internet is by starting an affiliate marketing business.

Affiliate marketing is, in short, an Internet-based form of marketing in which a company is rewarded (i.e., paid) for bringing new customers over to another company. (Here’s an article that explains the benefit of affiliate marketing.)

This might sound slightly confusing at first, but have you ever noticed those little ads on websites? You might be reading an article about jeans, and voila! Right next to the article is an ad for that very same pair of jeans that you’re after. If you click on that ad, you’ll wind up at an online retailer where you can purchase them, and most likely the person who owned the site you were reading initially will receive a kickback for “referring you” to the online store.

That means money for you … without really doing anything.

How to Get Started with Affiliate Marketing

This might have gotten your gears turning … so if you’re also thinking about trying your hand at earning passive income with an affiliate marketing program, you need to realize a few things:

You will need to have a system in place. Successful businesses are successful because they have good business plans. Once you have your system in place, you’ll have the opportunity to become a heck of a lot better off financially than you ever were going to become at your old day job.

An affiliate business needs its own website. This isn’t as hard as it sounds, really, but I’m not going to go all out and explain every detail right now. (Also here’s a post that discusses all the affiliate tools you need.)

You’ll also need to send out mass quantities of emails. Don’t worry; you won’t have to sit at your laptop typing in email addresses for 10 hours a day after you’ve composed your necessary emails … we’re trying to earn money passively, right?

So most likely you’re going to need to obtain a list of people to email, and an email marketing company can manage the list(s) for you.

Now, you might be wondering, how do you get this list of people for your email marketing company to email?

From your website, of course!

You need to have something really cool on your site, something so great – something so awesome – that people are willing to give you their email address so you can send it to them. Typically this is done by offering something for free – a free subscription to a newsletter, a free chapter of an e-book … something free.

Final Thoughts

Please keep in mind that these are just a few ideas that I’m throwing out there to help get you started. These really are things that I also do to earn a living. A very nice living, at that!

So yes, it really is possible to earn a great living without working 40 or 50 hours a week. I’m proof of that!

More info to come soon, I promise.

Take Action. Get Results.

8 thoughts on “Earning Passive Income on the Internet”

  1. Passive income is where it’s at 🙂 I have property (real estate) that I rent out, and it’s great getting the rent each month. Each house is hard work up front but then it pays off for a long time with minimal ongoing maintenance.

  2. You’re a braver person than me. Right now, I’m subleasing an apartment and it’s way too much of a headache to every consider doing real estate. I know there’s a ton of money to be made, but I don’t want to possess anything where I have to worry about day-to-day management.

  3. It’s funny, I’d have defined passive income as an up-front payment of time and effort for continued results. Affiliate marketing is my method of choice as well for the moment; heading over to look at your related posts now.

    Great post though, interesting.

  4. Actually Heather…I think you’re definition is also correct. While I wish I could say that affiliate marketing is 100% passive, I can’t. Honestly though if you looked at almost all “passive income” streams, you’d see that they have to spend at least a little bit of time maintaining it.

    I would agree that affiliate marketing is a great way to go, but it can be challenging sometimes. Definitely recommend doing a lot of homework for you get started.

  5. I’d have to agree with that assessment; but honestly? I don’t mind putting in the bit of work for more freedom. Besides, usually if it’s something passive you’re doing it because you enjoy it on some level as well (at least, that’s what I’ve found; coule be way off base).

    Started researching about affiliate marketing a few months ago, been starting to do it myself… honestly I think the biggest challenge so far has been marketing it so that enough people see the review and click through. Still tweaking on my end 🙂

  6. @Heather- Yes, affiliate marketing is definitely a learning process. But like everything else, it gets a lot easier as time goes on. You learn what works and what doesn’t. Then you apply this knowledge to make the process much smoother. Also it’s a numbers game…if you have a lot of web traffic, your marketing could stink and you’d still make money.

Comments are closed.