7 Things You Must Do To Start Making $1K a Month in Passive Income (2024)

If you want to generate a steady stream of money with little effort, passive income is the way to go. Passive income — money not derived from active involvement such as a salary —can come in a variety of flavors.

And while getting started with passive income can initially require some financial investments (and can require a great deal of patience), once your cash flow is in place, you can just sit back and relax. You might even make $1,000 a month.

Here are some ideas that could get you there.

Invest in Dividend Stocks

A stock portfolio focused on dividends can generate $1,000 per month or more in perpetual passive income, Mircea Iosif wrote on Medium.

“For example, at a 4% dividend yield, you would need a portfolio worth $300,000. While that’s a substantial upfront investment, dividends allow you to continually profit from top companies without selling any shares,” said Iosif.

And while a dividend stock strategy requires a fair amount of patience, it allows money to work for you.

“Even starting smaller now gives time for compound growth. $100,000 initially could become over $300,000 in 20-30 years,” added Iosif.

Sell Printables

As Sarah Sharkey of Clever Girl Finance noted, printables are one of the unique side hustles you can start online. These cover a variety of themes, ranging from planners to coloring pages, cards and more.

“Typically, you’ll have to create a printable only one time. You can use programs like Canva to help you create printables your customers will love,” Sharkey wrote. “Then you can watch the somewhat passive income roll into your life. Etsy is a great place to get ideas and start selling your printables.”

Create an Online Course

Certain websites, such as Udemy, enable you to create a course on their platform. The courses offered run the gamut, from IT certifications to sourdough bread baking, from speaking German to learning guitar. So if you have a specific skill, that might be the way to go.

“Once it’s published, it doesn’t require any additional maintenance from you, and you get paid when people take your class. It’s a low-output way of making some extra cash and helping people. That’s like a win-win… win,” Dave Ramsey indicated on his blog.

Open and Invest in a High Yield Savings Account (HYSAs)

Another effortless way to derive passive income is by investing in high-yield savings accounts.

Indeed, high-yield savings accounts (HYSAs) have been very attractive as of late — offering rates upward of 5% compared to an average 0.47% for traditional savings accounts, according to the Federal Deposit Insurance Corporation (FDIC).

Invest in Real Estate Investment Trusts (REITs)

Another avenue to real estate investing is to do so via REITs, which are essentially mutual funds that buy real estate instead of stocks.

Yet, Dave Ramsey urged caution on this subject. He said that while there are many good REITs, “There are still a lot of bad ones that use debt to purchase properties — which means more risk for you as an investor.”

Peer-to-Peer (P2P) Lending

Peer-to-peer lending entails loaning money — as little as $10 — and collecting interest on top of getting your initial investment back, as The MillennialMoney Woman explained in a blog post.

For instance, platforms such GroundFloor, a real estate peer-to-peer platform, offer the ability to fund micro loans for home flippers.

However, while passive income generated from P2P platforms can be very lucrative, the practice can also be a bit risky.

“Just make sure you do your research first — before you commit your resources financially,” The Millennial Money Women explained. Your initial funds are not always entirely safeguarded.

Use Affiliate Marketing

You can also generate passive income streams thanks to affiliate marketing — in other words, partnering with companies and promoting their products or services through affiliate links on your blog, website or social media platforms.

“Now this doesn’t mean you can just hashtag your favorite running shoes on Twitter and expect to get paid. The companies you know and love have to have an affiliate marketing program for you to get paid for it, and you’d need to apply to become part of it,” Ramsey detailed.

Websites such as Rakuten LinkShare can help you find and connect with those affiliate marketing programs.

More From GOBankingRates

• 5 Food Items You Should Always Buy at Walmart
• I Was Retired, but Wasted Big Money On These 3 Things and Had To Go Back To Work
• 7 Things to Do With Your Savings in 2024 to Grow Your Wealth
• 4 Reasons You Should Be Getting Your Paycheck Early, According to An Expert