In 2015, after being laid off from my full-time job at a tech startup, I was overwhelmed with stress and confusion. I’d lost the only source of income I had, but I still had a stack of bills and financial obligations to take care of. I decided that I wanted to do whatever I could to make sure I was never in that position again.
Soon after, I learned that self-made millionaires usually have around three to four sources of income. I knew I wanted to eventually be a millionaire — or at least someone who never had to worry about losing a paycheck. So I’ve tried to add new streams of income every year, from new products and services that I launch through my two businesses — one in the wedding space and one as a content creator — to more passive streams, like selling online courses and doing affiliate marketing. I currently have more than seven streams of income that help me earn six figures a year.
If you’re eager to find ways to add new passive-income streams to your financial portfolio, here are five ways to start in 2023.
1. Asset sharing
Asset sharing is the act of sharing things that you already own, at a price. Based on demand in your local area, you can make passive income just by handing over your keys, your space, or an item for a period of time.
Write a list of what you have that other people might want to rent and then list that asset on a platform where people are searching for access to that item. For example, you can rent your car using Turo, your apartment for meetings or photo shoots using Peerspace, your garage for storage using Neighbor, and even your baby’s stroller using BabyQuip. One mom made $5,000 a month renting out the baby items she no longer needed to people who wanted to rent them temporarily.
In the past, I’ve rented out space in my apartment for events, and while it was good income, it did come with added cleaning expenses that I had to pay for. While I made a few hundred dollars in cash doing this, I’d likely do it again but at a higher price point to make it worthwhile.
2. Peer-to-peer lending
If you have extra cash in your savings account, you can become a peer-to-peer lender. Rather than going through banks, people can apply for loans on different platforms where the cash comes from real people instead. As a lender, you give them your money and earn interest in exchange — some investors report earning more than 10% in returns a year — and based on the platform you use, you can make loans as small as $25. One man makes 2,200 euros a month doing this.
Platforms I’ve researched in the past but I’m personally waiting to try until I figure out my financial strategy for 2023 include LendingClub and Prosper. However, this passive-income stream does come with more risk if the person doesn’t pay back the loan, so be sure to look at the terms offered by the lending platform to see what coverage you get in case of a situation like this.
If you’ve always wanted to start an e-commerce side hustle but didn’t want to have to invest in inventory, you might want to consider dropshipping.
Not only is dropshipping a form of passive income, but it doesn’t require you to spend any cash up front on products. Instead, once you decide what kind of products you want to sell, you can build a brand around those products and launch an online store. You can then pull products in from dropshipping platforms like Ali Express and Spocket.
To find products that have a higher chance of success, you can research top-selling items on Amazon using sites like AMZ Insight or Jungle Scout. Once someone purchases the item on your website, it’s pulled from those platforms and shipped directly to them, requiring little effort on your part. One entrepreneur made $1.7 million doing this in 2021.
The one downside is it does require a lot of up-front development, from creating the website to marketing, to build an audience. You can learn more about doing this by taking a free course through Shopify or Udemy.
In the past, I’ve considered going down this route but decided not to, since I wanted to find ways to sell products I created from scratch. I ended up doing that by creating a card game and selling it on my own website. While it brings in passive income every month, the biggest hassle is having to store inventory in my small apartment.
4. Investing in crowdfunded real estate
One of the most-talked-about streams of passive income is the money you can make by buying real-estate properties and renting them out. For those who don’t have the capital to invest in a second property, there are other ways you can earn passive income through real estate.
For example, you can invest in crowdfunded real-estate properties — which I’m interested in doing in 2023 as a way of entering real-estate investing, without buying a property of my own — or funds as a way to hopefully make recurring passive income. You can get started using Fundrise, where with just $500 you can invest in a starter portfolio of real-estate-investment trusts, or REITs. You can also use RealtyShares, which requires a minimum investment of $5,000.
While the amount you can make from this varies, starting with a low initial investment could be a way to get into real estate without buying properties on your own.
5. Monetizing your audience
If you’ve been growing your followers or subscribers, whether on social media or through a creative outlet like a podcast or a newsletter, you can earn passive income from monetizing your audience. Brands and advertisers are looking to showcase products and services to specific audiences, so even if you don’t have tens of thousands of followers, you can still work to make advertising or affiliate money, especially if you have a niche demographic that’s appealing to these businesses.
To monetize my audience in the past, I’ve used platforms like Swapstack for my newsletters and podcast, RewardStyle to promote general products that interest me, and AspireIQ for brand deals to promote products on social media. After working out a deal with these advertisers, you’re often given a unique affiliate link or code to share with your audience. When those links are clicked, you receive a percentage of the revenue, which is typically anywhere from 3% to more than 30%, depending on the offering. Some months, I’m able to make a few thousands dollars with this passive-revenue stream.