The word passive income gets thrown around a lot, and people come up with the same old impractical stuff.
Use chatgpt to write code and content; it is not passive or feasible. Buy real estate and rent it out. Sure, it is passive, but where do they expect us to get the down payment for this?
Make a training course and earn while you sleep... Seriously, how many such courses are there? The answer is millions. The same can be said about the probability of you making money.Print-on-demand is the Gen Z answer to passive income, except it is not cost-effective and rarely works. The only person this makes money for is the print-on-demand company, which charges you for every print. It's important to do your research and find a legitimate way to make passive income that aligns with your skills and interests. Don't fall for get-rich-quick schemes or courses that promise unrealistic results.
Moving past all the scams, here are some legit ways to earn passive income, in my opinion (this is not financial advice; do your own research):
1 - Dividend stocks allow you to invest incrementally, and with a sound understanding of financials, you can invest in proven dividend stocks. Initially, the money is low, but if you keep on reinvesting your dividend, this amount compounds drastically over time. But the biggest pitfall that many people face is that not all dividend stocks are created equal, and investors should carefully evaluate the company's financial health and dividend history before investing. Also, bear in mind the kinds of stocks that are dependent on market conditions and economic factors. Personally, I like investing in stocks that focus on necessities like pharma and FMCG.
2 - Gold bonds: Gold bonds provide a fixed percentage of interest per annum but also provide capital appreciation in the long term. While their rate of return is low, they are still less volatile and a much safer option than stocks. It is important to note that the value of gold bonds is also subject to changes in interest rates and inflation.
3 - REITs - Real estate investment trusts) As I said, not all of us have the capital to invest in real estate. The next best thing is REITs, wherein you buy a share in real estate through companies called REITs. This works like mutual funds, as these companies invest on your behalf. As always, it's important to do your research and choose a reputable REIT with a solid track record.
4 - Crypto staking - Staking on hive or delegating is a great passive income. Crypto staking is transparent, with no hidden costs, and quite stable, in my opinion. Again, this does not give as high returns as active crypto trading, but it is less risky and completely passive. For hive, I have been using dlease as it offers some rates of return. The return from HBD which stands at an impressive 20% is also a great way to earn passive income on HIVE.
There you have it, my take on true passive income. Are there any different ones that you have?