passive income — 2/3 — Beating Broke

Passive Income from Freelance Writing: Write Once, Get Paid Again and Again

July 20, 2012 By Denise Gabbard 7 Comments

“Passive” writing income is derived from work that is done one time and continues to pay over and again, as opposed to “active” writing income which means a particular assignment is undertaken and paid for when it is complete. Getting paid for an article or an eBook one time is great, but how about getting paid for the same article or book many times? For freelance writers, creating passive income sources adds flexibility; a cushion of passive profits allows for working less while still maintaining a significant income level.

Where can you earn passive income from freelance writing?

Passive income can be derived from a variety of sources — blogs, selling digital or ebooks online, websites, traditional or self-published physical books, article sites like Squidoo and Helium, and semi-local news sites like Patch and Examiner.

Writers with a solid foundation in place will continue to draw readers or sell books even when they are sleeping or on vacation.

img credit: LaMenta3, on Flickr

Selling eBooks Online: Writers with specialized knowledge that would help others can put it together in an eBook and sell it online. It is easier than ever to sell nowadays, and listing on Amazon for Kindle download makes it super convenient. EBooks on popular topics continue to earn as long as marketing is done, and at the typical 30-50 pages, one can be put together quickly.
Blogs: Blogs can be great passive income sources once the time and effort has been put into building traffic and revenue streams. Many new bloggers give up on their sites much too soon; they do not instantly see lots of traffic and they stop blogging. In reality, there is a growth curve for new blogs, and most often the blog will not receive massive traffic or much income for the first six months to two years.
Websites: Like blogs, websites that offer great content that is valuable to a large number of people can draw massive traffic. In turn, offering digital products on the site could add up to earning a substantial income. Research the market to be sure the products offered are relevant and compelling to lots of people.
Traditional and self-published books: Not to be confused with eBooks, traditional and self-published books can also be sold online, on sites like Amazon. The length is what differentiates these from eBooks. Books published by most publishers can be sold online and in book stores; when a publisher takes on a book, they generally work with the author to make sure it sells well. Many authors have self-published, both online and in print form, with varying degrees of success. Bloggers can easily make the move to book form by utilizing the wealth of information they have that can be packaged and sold. It is important to consider print versions of books because some people prefer a physical book.
Royalty sites: Freelance writers can also write for online sites that pay by the popularity of their articles. There are a large number of these sites online; among the most popular are Squidoo, HubPages and Helium. These sites typically pay based on many views your article gets, so write a quality article and publicize via social media to get the most readers to it. Other sites where you can write on a specific topic and get paid on a revenue sharing basis are ExpertsColumn and Suite 101. Sites like Examiner and About.com offer writers both nominal pay upfront and pay for the number of views.
Affiliate Writing: Writing articles promoting affiliate products is another way to earn passive income. Writing an article outlining a problem is an excellent way to introduce the solution…and you get paid whenever someone clicks on your article’s link and takes advantage of that solution. Once your article is written and online, you will continue to get paid anytime someone clicks and/or purchases the product, depending on the affiliate agreement. Your articles can be posted on your blog, other blogs and websites, and even article directories. Again, promoting them with social media and bookmarking sites will increase your audience, and ultimately, the money you can make.

Do some passive freelance writing so that money will flow into your bank account even when client, family, or other responsibilities demand most of your time.

Why I Like Passive Income

July 11, 2012 By Shane Ede

When you’re in debt, and trying to escape from the cycle of debt, the one thing that seems to dominate your every thought is paying off that debt. Far too often, those of us who talk about debt and finances regularly tend to focus on debt as well. We focus on paying off debt, eliminating debt, and ways to spend less money so you free up more money in your budget to pay off that debt. What we don’t talk about often enough, in my opinon, is making more money. In many ways, increasing your income is just as important to your fight against debt as staying disciplined in paying your debt off.

I don’t know about you, but I often feel like my income is capped. In any job, you are either paid a yearly salary, or paid an hourly wage. In that way, you’re income is capped. If you’re paid on a salary, it doesn’t matter how much you work, you only get paid a certain amount every pay period. If you work hourly, there are only so many hours that you can work in any pay period. There are always ways to advance yourself through the workforce, and up the ladder at work, but your income is still capped.

Uncapped income.

Passive Income Cash Machine — img credit: Whatleydude on Flickr

One way to increase your income, that doesn’t require that you work all hours, and that doesn’t cap your income is through passive income. I’ve talked about it before here, and here, and here. The ideal definition of passive income is income you earn without putting in any work. And, maybe in an ideal world, that type of income would actually exist. In our less than ideal world, truly passive income is very hard to find.

How I define passive income

I like to define passive income in somewhat more liberal terms. To me, any income that I can earn with a minimal amount of work is passive income. If I can make income off of something that only takes me 30 minutes a month, I consider it passive income. Anything that continues to make me money long after I’ve put the work in counts too. It’s like Ronco income. “Just set it and forget it!”

For me, my blogs and websites are passive income. A majority of the income I make off of them is income from posts I’ve already written. The work has already been put in, and it would continue to pay me even if I quit writing. My traditional stock portfolio is a passive income. I did the work early on, earning the cash to buy the stocks, as well as doing the research to pick the stocks, and many of them pay me dividends on a regular basis. That dividend payment is a passive stream of income. Yet another stream that I take advantage of is my Lending Club portfolio of peer-to-peer loans. (See my latest report on LC)

Other forms of passive income can include things like royalties, patents, and rental properties. I’m sure if you think hard enough about it, you’ll find several other streams of potential income that would fit my definition of passivity. (Share them in the comments!)

Why do I like passive income?

Naturally, I like passive income because I’m lazy. 😉 After all, what could be lazier than earning money while you sit on your behind and watch soap operas on T.V.?

“Naturally, I like passive income because I’m lazy.” — @beatingbroke (Click to Tweet)

As much as I like that reason, the real reason is a bit more explanatory. I like paying off my debt. I like the ability to do that while still enjoying life. And, as many of you can attest, doing both of those things can sometimes be somewhat difficult. Balancing the expenditures that can come enjoying life (even a frugal one) with paying off your debt is troublesome. The best way that I’ve found to try and do both is to work hard at paying off debt, while working hard at increasing income at the same time. Without passive income, the only way to increase income is to work more hours at your hourly job or to negotiate regular raises at your salary job. Recently, it’s become even more difficult to do either of those. Passive income becomes the last, best way to increase your income with little to no continuing work output.

Why do you like passive income? What do you consider to be passive income? What are some of your passive income streams? What are some that you’d like to take advantage of?

Why Passive Income is Better

November 16, 2011 By Shane Ede 19 Comments

Passive Income is a bit of a myth. Not so much in that it doesn’t exist (it does), but in what it really is, and why we should all be striving to attain as much passive income as possible. I’ve written before about what passive income is. But, in that article, I only wrote a short paragraph on why we should want passive income.

What is Passive Income

You should read the original post on what passive income is, but I’ll recap here as well. In a nutshell, passive income is income that you earn with little ongoing effort (work).

Why Passive Income

The why of passive income is really the motivating factor for most people. Many of you know the allure of free money, or easy money. And many of you will mistakenly think that passive income fits one or both of those categories. It doesn’t. The difference, and the reason you will still want passive income, is in the ongoing work part. With a traditional job, like the one I recently quit, you get paid per unit of work. If you work one hour, you get paid $x. If you work one year, you get paid $xx,xxx. If you build one widget, you get paid $xx. Your earning potential is directly tied to the amount of work you do. More work = more money. It’s a finite system. You can only work so many hours in a day, so you can only make so much money.

You’ll still work for your passive income, but, if it’s a true passive income source, you’ll be able to work less for the money as time goes on. The income is no longer tied to the amount of work you put in, except in the beginning. Please don’t think that passive income is easy, or that it requires no work. It does. In fact, you might work harder than you have before initiating it. But, once it’s initiated, the work can decrease if you want it to.

Passive Income Examples

One of the most common examples of passive income is rental income. You rent out a property, using a property management service, and all you have to do is sit back and let the rent checks roll in. Sounds easy, right? It is. But, you have to get there first. You’ve got to do the work necessary to have the ability to purchase that rental property. You’ve got to do the work to make sure that it meets codes so that it can be rented out. You’ve got to do the work necessary to find a property management service that fits your needs. And, even though it then becomes almost entirely passive, meaning you do no work to attain it, there might still be some occasional work that needs to be done, like deciding whether a repair should be done, and by whom. As you can see, there’s a huge outlay of work to set up the passive income stream.

Another popular example of passive income is dividend paying stocks. You own some shares of some companies that pay dividends to their shareholders, and let the dividend checks roll in. Sounds easy, right? It is. Again, you’ve got to get there first. You’ve got to do the work necessary to have the ability (money) to purchase those shares.

Passive Income isn’t Free Money

Passive income isn’t free money. I can’t repeat that enough. And it isn’t easy money. You’ve got to put some work in to set up the passive income streams first. But, once you’ve set them up, each day, week, and year, makes your work cost to attain those funds diminish. Until, at some point, your work cost per unit of income is fractional to what it would be in a traditional job. If a traditional job requires 1 unit of work for each unit of pay, over time, passive income might require 1/100th unit of work for each unit of pay. And, that, is why we should all want passive income.

For me, passive income isn’t about being able to sit on a couch and watch television while the fat checks roll in. It’s all about being able to pay my bills while I do the things that I like to do. This site, and others I own, help me with that (although they are far from passive, they aren’t traditional jobs for me either). I’m working on other methods of increasing my passive income stream as well. I’ve always wanted to be a published fiction author. I’m participating in NaNoWriMo to that end, with hopes of being able to self publish ebooks and use the royalties from that as another passive income stream. I like to take photos, so am going to be exploring avenues of making some income with that as well. It will require taking more photos, which is work, but, because it’s something I do as a hobby already, it’s a variant of a passive income stream for me.

What are some of the passive income streams that you employ? What are some of the things that you do as hobbies already, that you might be able to turn into an income stream?

photo credit: quinn.anya