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Initially you may only be making a small amount of money passively, and you might 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 that you could quit your job or retire .

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 cases it might be long-term recurring income, and in some other cases it might be short lived or inconsistent.

In some cases 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.

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 thoughts 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 require on-going work, either by yourself or by others that youre paying.  Selling ebooks or courses will require on-going customer service, plus youll need a consistent traffic source in order to continue to make sales. It is possible and there are individuals who have been able to do it passively, but they make up a small percentage of individuals who really set out to do it.

Ive been blogging fulltime for 10 years and Ive sold ebooks and classes in the past. Theyre great ways to make money, I simply dont consider these to be more passive, in the majority of cases. .

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Nearly any business can be a source of passive income when youre paying other people to run the business. That is true with both online and traditional businesses. That opens up even more possibilities than what will be listed here.

Now lets have a peek at some of the best ways to produce passive income. Some of these are investments that will need some money to start with. Other folks wont need any money to get started. In case you dont have the money to invest now, consider starting with the methods that dont need any money, and then utilize that money that you make to invest. .

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Your very first financial priority must be to build up an emergency fund that can cover all of your living expenses for a couple months. But dont put this money is a checking right here account or savings account at a local bank that pays you a terrible interest rate. You can open a high yield savings account or money market account with an online bank that will earn a lot greater 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 stock, or take the dividends in cash. Reinvesting will allow you to own more stocks, 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 success. Because of this, these investments tend to be considered less risky than the website link stock exchange in general.

Dividend stocks can be a terrific investment regardless of whether you want to reinvest each the dividends on hold on to the stock for quite a long time, or make use of the income generated through the dividends.

For much more detail on the topic read Investing in Dividend Stocks at Investopedia. To get a list of those 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 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 cases the borrower gets a better interest rate than they could get from a bank. As an investor, you can earn a great return too.