Earning extra income every month sounds good, right? Whether you’re saving money to buy a house, planning a wedding, trying to pay off your debts or just looking for new ways to be productive, earning extra money and having a passive income can go a long way!
While it's true that a day job may help you pay for your basic expenses, having an extra job could give you the financial freedom you've always wanted. In times of Covid-19, we have seen how many people are reinventing themselves to the point of creating new ways to earn extra money from home. Side gigs are also becoming increasingly popular and many people agree that they are here to stay.
In this article, we’ll tell you which are the best ways to earn extra money every month.
What is passive income?
Passive income can have more fringe benefits than active income. In fact, many investors see these sources of income as a means to supplement their ordinary income and to offset their cost of living. Having a passive income can also give you an excellent opportunity to avoid paying too much taxes each year.
Passive income is any source of income that does not come from an active or ordinary source. It could be dividends, being part of a business as a limited partner, investing in cryptocurrencies, royalties for license fees, or even income from other investments in which investors are not actively involved.
Passive income could be defined as the income you earn while doing other things. In other words, this means that to earn passive income, you don't need to spend time or effort to earn it. If you're wise, good passive income practice can lead to early retirement or even financial freedom.
Difference between active, passive and portfolio income
There are three main types of income: active, passive and portfolio. Let’s review their characteristics in order to understand the pros, cons and differences between each of them.
This type of income is earned by working personally, which basically means exchanging our personal time and talent for money. Most of the people who earn this type of income belong to the working class and work as company employees or are self-employed. These types of people -the vast majority around the world- cannot afford to stop working because they would lose their main source of income and therefore, they would not be able to cover their basic expenses. Active income is received by payroll or by specific jobs on-demand (gigs).
The main difference between active income and passive income is that for passive funds to be in your pocket, you don't have to work or you don't have to be present at the office or at work every day. For example: Imagine we have a friend who owns a building and he rents 20 rooms for $ 500 per month each. Therefore, he doesn’t have to work and he can spend his time travelling all year round while receiving a bill of $ 10,000 per month. The vast majority of people who earn this type of income are managers or administrators who own businesses and companies. They usually have a residual income system that keeps their economy growing and generates passive income for life. No more work, sounds amazing right? It’s not essential to be rich, as we will see later. Other passive income ideas can be royalties from ebooks sales or recorded albums.
Portfolio income is a variant of passive income. The difference is that the money here is not invested in companies that require employees, but it’s earned through investment in stocks, bonds and investment funds. Most of the people who generate this income are experienced entrepreneurs who invest in stock exchanges such as the Tokyo Stock Exchange, the London Stock Exchange Group, the Nasdaq and the New York Stock Exchange.
How do I generate a second source of income?
If you’re looking for a way to have a second source of income without quitting your current job, there are many ways to do it! Here are some of the best ways to generate a second source of income:
Dropshipping is one of the best ways to earn additional income. This business model is becoming more and more popular, as it allows you to sell products directly to customers without having to deal with any inventory. You act as an intermediary between customers and suppliers because your supplier not only manages the inventory for you but can also send it directly to the customer.
Here, you should focus on building your brand image, creating promotions and advertisements, while still providing good customer service. If you already have some marketing experience and want an extra job to show your skills and make a lot of money, then Dropshipping is definitely a great choice. Check out platforms like Shopify and Dropshipping tutorials on Youtube, there’s plenty of them!
Become a freelance writer
One of the best ways to make money from home is to become a freelance writer. The best thing about this side gig is that it allows you to earn money without investing. Most importantly, you can decide how much time you want to spend and when to work. You can work for one or a couple of customers and make this side gig your weekend job, or even take it more seriously and try to attract more customers. The secret to success as a freelance writer is to get paid based on the value and length of your articles. Most freelance writers only charge very little money and it can be tiring work. However, make sure to sell yourself correctly and don’t hesitate to charge what you think is appropriate.
Affiliate marketing is a great idea to earn extra money and, depending on how well you do it, it can make you a lot of money or nothing.
It's not just about finding the right niche and product to promote, but also the right brand to partner with. You have to create a website or a blog that talks about certain topics and recommend, compare, test or review different products. For example, if you’re a member of the Amazon affiliate program, you will include product links on your website. These links have a specific code and Amazon tracks all the sales that come from it.
It depends on the product you are selling and the affiliate network you use. For example, if you were an affiliate seller of a company like Amazon, you could get a commission that is between 3 and 11% of the product that is sold through your affiliate code. It’s a job that requires a lot of effort and time for a few months, but will then turn into passive income for many years.
It may sound a bit frivolous, but another option to generate a second source of income is to become an Instagram influencer. It’s becoming more and more common for companies to invest in influencer marketing, so why not take the opportunity to earn an extra salary with this job?
You don't have to be the most attractive person in the world to do it, since there are different niches in which you can position yourself. Maybe you have a really good fashion sense, you know a lot about nutrition or you can bake delicious cakes. In any case, you can monetize your Instagram account in a number of ways: sponsored posts, affiliate marketing or selling products on your posts and website. Even if you don't like being the centre of attention, you can create an Instagram account focused on your cat or your analog photographs.
Tips to make extra money
If you are still not convinced by any of the ways we mentioned to generate a second source of income, here are some tips that will inspire you to earn extra money.
You can get paid for transcribing texts and the best part is that you don’t need any advanced knowledge other than being able to type quickly on your computer. Having some experience can help you increase your rate, but it’s not necessary to start off. What you need to do in order to get paid is to listen to an audio file and write as much as you can. This work can be a bit tedious and boring, but it’s definitely a good way to start earning extra income.
Walking dogs and taking care of pets
If you’re an animal lover, you will love this job! You can make extra money by doing the things others don't have time to do, like walking dogs. The key is to be able to offer your services at a time when people are usually busy. This is one of the simplest things you can do to earn more money fast.
Rent your parking space
Why not rent your spot when you’re not using it? You could earn up to $ 2,000 a year from your unused parking spot. With clicNpark, you can manage remotely from your computer or phone and have your money deposited directly in your account.
How does it work? It’s really easy: List your spot, offer your spot only when it suits you and... the money is yours! Sounds good enough? List your space and start earning money with your parking spot! You can also rent your indoor parking!
Buy and sell second-hand objects
It’s more common that you start by selling what you don’t use to earn extra cash. However, if you explore a bit and have a good eye for fashion (for example), you may find opportunities not only to sell what you have at home but to buy second-hand items at bargain prices and resell them at a higher price.
Work on events
If you are a good photographer or play a musical instrument, you can offer your services for baptisms, weddings and birthdays. This is a great way to practice your hobbies and earn money at the same time. Not for nothing did you study violin for 10 years!
Fill out surveys
This is a classic that we all have at our fingertips thanks to the internet. Filling out surveys is one of the ways to earn extra money from home wherever you live. The only problem here is going to be how much you really value your time since you get paid very little for the amount of time you spend on it. But hey, all income is welcome!
Become a consultant
If you’re an expert in your area, you have initiative and haven’t signed any exclusivity clause with any company, you can offer your services to others as a freelancer and generate an interesting sum of extra money. This formula will allow you to earn extra money on weekends or when you finish your workday. In the field of marketing, for example, it’s very common for professionals to offer their consulting services with private classes or to small groups specializing in areas to improve.
Give language classes
If you speak a second language well enough to teach it to someone, why not do it? If you don’t, giving language classes in your mother tongue is also a good option. There are always foreigners willing to learn different languages and you can teach them online. The only thing you need to start offering virtual classes is your computer, internet, headphones and a microphone.