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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 that it compounds and grows quicker. However, with some time, its potential to make enough passive income that 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 make without putting in much work. The money will flow in without too much being required of you. In some scenarios it might be long-term recurring income, and in other instances it might be short lived or inconsistent.

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

What qualifies as passive income is up for debate. Most lists which youll find online will include things like blogging, writing e-books, or creating your own course. Im not including those ideas in this informative article because, in my opinion, all of them require too much effort to be considered as passive.

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Blogging will constantly need on-going work, either by yourself or by other people that youre paying.  Selling ebooks or classes will require on-going customer support, and youll need a consistent traffic supply in order to continue to make sales. It's possible and there are individuals who have been able 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 years and Ive sold ebooks and courses in the past. Theyre great ways to make money, I just dont consider them to be passive, in the majority of cases. .

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

Now lets take a peek at a few of the greatest ways to make passive income. Some of these are investments that will need some money to begin with. Other folks wont need any money to get started. If 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 first financial priority should 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 account or savings account at a local bank which pays you a horrible interest rate. You can open a high yield savings account or money market account with an online bank that will earn a much greater return for you.

My wife and I keep 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 quick 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 cash. Reinvesting will allow you to own more stocks, which contributes to more 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. As a result of this, these investments tend to be considered less risky than the stock exchange 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 a long time, or make use of the income produced throughout the dividends.

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

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Peer-to-peer lending (or P2P) is becoming extremely popular in recent decades. Borrowers and lenders can be find paired up through a site or marketplace. Instead of going to a bank, the debtor receives a loan from an investor.

In some situations the borrower may not have the ability to be eligible for a loan via a traditional bank. And in many cases the borrower gets a better interest rate than they might get from a bank. As an investor, you can earn a good return as well.