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At first you may only be making a tiny 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 potential to create enough passive income you could quit your job or retire early.

Passive income can be a small divisive topic. In general, passive income is any money you earn without putting in much effort. The money will flow in without too much being required of you. In some scenarios it could be long-term recurring income, and in some other instances it could 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 long run when youre making the money.

Exactly what qualifies as passive income is up for debate. Most lists which youll find online will include things such as 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 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 that youre paying.  Selling ebooks or classes will need on-going customer support, and youll need a consistent traffic source in order to continue to make sales. It is possible and there are people who have been able to get it done , but they make up a small percentage of people who actually set out to do it.

Ive been blogging full-time for 10 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 most cases. .

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Nearly any business can be a source of passive income when youre paying others to run why not find out more the business. This is true with both online and traditional businesses. That opens up even more chances than that which will be listed here.

Now lets take a look at a few of the best ways to make passive income. A number of these are investments which will require some money to begin with. Others wont require any money to begin. In case you dont have the money to invest now, consider starting with the approaches that dont require any money, and then use that money you make to invest. .

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Your very first financial priority must be to develop an emergency fund that can cover all of your living expenses for a few months. But dont put this money would be 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 which will earn a lot better return for you.

My wife 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 1.85% APY and CIT savings accounts are earning 1.55% APY. Thats 22x the national average! Opening an account with CIT is fast and easy, and can be done online. .

Some companies consistently pay dividends to their shareholders. As a trader, you can re-invest the dividends to buy more shares of the inventory, or take the dividends in money. Reinvesting will allow you to own more shares, 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 my link success. As a result 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 all of the dividends on hold on to this stock for a long time, or use the income generated throughout the dividends.

For far more detail on the topic read Investing in Dividend Stocks at Investopedia. For a list of those stocks, 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 years. Borrowers and lenders can be paired up via a site or market. Instead of going to a bank, the debtor receives a loan by an investor.

In some situations the borrower may not have the ability to be eligible for a loan through a traditional bank. And in many circumstances the debtor gets a much better interest rate than they might receive from a bank. As an investor, you can earn a great return as well.