In 2021, creating passive income streams is more important than ever before because with the economy being propped up by the Federal Government, it’s possible that we could see another crash, or change to the economy at any time.
Thankfully, when you create multiple streams of passive income, you can have confidence and peace of mind as an investor in knowing that should one part of the market crumble, you will have other reliable streams of passive income that you can depend on.
In this article, I will share with you the direction for the passive income streams that you should consider creating this year.
Digital Passive Income Streams
Since we live in the internet age, it makes sense for every investor to put their money into digital passive income streams including the following:
Affiliate Marketing – What’s ideal about this passive income stream is that it’s easy to get started with earning passive income because all you have to do with affiliate marketing is drive traffic to products or websites and earn a commission when that traffic converts into sales.
E-Commerce – It’s easier than ever before to start an e-commerce business since you can easily source products from countries like China and earn a nice profit from your efforts.
Create An App – Another excellent way to earn passive income in 2021 is by creating an app and promoting it from your website. Keep in mind that this method of earning passive income does require research because there are tons of apps out there. The key is to create an app that fits a need because when you can make someone’s life easier by solving a problem, you will make good money from this business model.
Blog Or YouTube Channel – Leverage your existing knowledge and experience by creating a blog or YT channel to promote your expertise online. Keep in mind that even though you may own your blog, YouTube has been known to demonetize its users in recent years so it’s best to tread carefully with the content that you publish to their website.
Flipping Products – Although it takes some work to get started, you can make money (passive income) simply by buying products at a low price and selling for a higher price. One thing to remember when flipping products is that you should always research the products that you buy first because it’s possible to think that you’ve found a winner, only to get stuck with trying to sell something that people don’t want.
Earn Passive Income From What You Already Have
Rent Out A Room In Your Home – Do you own your own home? If so, another time-tested way to earn passive income is by renting out one of the rooms in your house to a tenant.
This method of passive income generation isn’t for everyone because you will also have to be open to acting as a landlord, so it’s best to tread carefully before you choose to move forward with this method.
Run Advertising On Your Vehicle – If you’re still commuting to work daily, another excellent way to earn passive income from something that you’re already doing is by running advertising on your vehicle.
Rent Out Your Excess Items – Do you own a boat, RV, trailer, or tools that you’re not using regularly? If so, another excellent way to earn passive income is by renting out those excess items.
One of the best ways to do this is to work with approved vendors that specialize in these types of rentals so that you don’t have to worry about making payments and doing everything yourself.
Earn Passive Income From Real Estate
Last of all, but most important, another great way to earn passive income in 2021 is by investing in real estate.
Investing in rental properties is an effective way to earn passive income. But it often requires more work than people expect.
If you don’t take the time to learn how to make it a profitable venture, you could lose your investment and then some, says John H. Graves, an Accredited Investment Fiduciary (AIF) in the Los Angeles area and author of “The 7% Solution: You Can Afford a Comfortable Retirement.”
Opportunity: To earn passive income from rental properties, Graves says you must determine three things:
- How much return you want on the investment?
- The property’s total costs and expenses.
- The financial risks of owning the property.
For example, if your goal is to earn $10,000 a year in rental cash flow and the property has a monthly mortgage of $2,000 and costs another $300 a month for taxes and other expenses, you’d have to charge $3,133 in monthly rent to reach your goal.
Risk: There are a few questions to consider: Is there a market for your property? What if you get a tenant who pays late or damages the property? What if you’re unable to rent out your property? Any of these factors could put a big dent in your passive income.
And the pandemic has posed new challenges, too. Due to the economic downturn, you may suddenly have tenants who can no longer pay their rent, while you may still have a mortgage of your own to pay. Or you may not be able to rent the home out for as much as you could before, as incomes decline. And home prices have been rising quickly of late due in part to low mortgage rates, so your rents may not be able to cover your expenses. So, you’ll want to weigh these risks and have contingency plans in place to protect yourself.
My preferred method for real estate investing is multifamily properties because they are in demand nationwide and more doors equal more income.
Not every multifamily property is going to be a winner though, the key to success with investing in multifamily is finding the right property that’s in a great location, close to everything, and is part of an area that’s on the rebound economically.
Contract Trier Capital
At Trier Capital, Our simple step-by-step process allows you to accelerate your wealth creation so you can live a magnificent life on your terms, whether that means traveling the world, spending more time with family and friends, or making an impact.
To learn more about our process for sourcing, acquiring, and managing investment properties, click here to connect with me online or call (630) 229-2383.