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Initially you may only be making a small amount of money passively, and you may even want to re-invest that money so it compounds and grows quicker. But with a few time, its possible to create enough passive income you could quit your job or retire early.

Passive income can be a bit of a divisive topic. In general, passive income is any money 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 some other cases it could be short lived or inconsistent.

In some cases youll need to put in some effort up front, but then it wont require as much effort in the future when youre making the money.

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

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Blogging will always require on-going work, either by yourself or by other people which youre paying.  Selling ebooks or courses will need on-going customer service, and youll need a consistent traffic source in order to continue to make sales. It's possible and there are individuals who've been in a position to do it , but they compose a small percentage of people who actually set out to do it.

Ive been blogging full-time for ten decades and Ive sold ebooks and classes in the past. Theyre great ways to earn money, I simply dont consider them to be more passive, in the majority of cases. .

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Nearly any business can be a source of passive income if youre paying other people to run the business. That is true with both online and traditional businesses. This opens up even more chances than what will be listed here.

Now lets take a peek at a few of the best ways to make passive income. Some of them are investments which will need some money to start with. Others wont require any money to begin. In case you dont have the money to invest now, try starting with the approaches that dont require any money, and then use that money that you earn to invest. .

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Your very first financial priority must be to develop an emergency fund that will cover all of your living expenses for a few months. But dont put this money is a checking or savings account at a local bank that pays you a terrible interest rate. You can open a high yield savings account or money market account with an online bank that will earn a much better return for you.

My spouse and I maintain 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 simple, and can be done online. .

Some companies consistently pay dividends for their shareholders. As a shareholder, you can re-invest the dividends to buy more shares of this inventory, or take the dividends in money. Reinvesting will let you own more stocks, which leads to greater dividends in the future (ideally).

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

Dividend stocks can be a terrific investment whether or not you want to reinvest each the dividends on hold on to this stock for quite a long time, or make use of the income produced through the dividends.

For far more detail on the topic moved here read Investing in Dividend Stocks in Investopedia. To get a list of those shares, see this collection from Dividend.com and this collection from DividendValueBuilder.com.

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Peer-to-peer lending (or P2P) has become extremely popular in recent years. Creditors and lenders can be matched up through a site or marketplace. Instead of going to a bank, the borrower receives a loan by an investor.

In some cases the borrower may not have the ability to qualify for a loan through a traditional bank. And in many cases the borrower gets a much better interest rate than they might get from a bank. As an investor, you can earn a good return too.