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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 it compounds and grows quicker. But with a few time, its potential to make 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 earn without putting in much work. The money will flow in without too much being demanded of you. In some scenarios it could be long-term recurring income, and in other instances 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 long run when youre making the money.

What qualifies as passive income is up for debate. Most lists that youll find online will include things such as blogging, writing e-books, or creating your own course. Im not including those ideas in this post because, in my own 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 other people that youre paying.  Selling ebooks or courses will need on-going customer support, plus youll need a consistent traffic source in order to continue to create sales. It is possible and there are individuals who have been able to do it passively, but they compose a small percentage of individuals who really set out to do it.

Ive been blogging fulltime for ten decades and Ive sold ebooks and classes in the past. Theyre great ways to earn money, I just dont consider them to be more passive, in most cases. .

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Just about any business can be a source of passive income when youre paying others to run the business. This is true with both online and traditional businesses. This opens up even more possibilities than that which will be recorded click for more info here.

Now lets have a look at a few of the best ways to make passive income. A number of these are investments that will need some money to begin with. Other folks wont need any money to begin. If you dont have the money to invest now, consider starting with the methods that dont require any money, and then utilize that money you make to invest. .

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Your very first financial priority should be to build up an emergency explanation fund that will cover go all your living expenses for a couple months. But dont put this money is a checking 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 much better 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 1.85% 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 for their shareholders. As a shareholder, you can re-invest the dividends to purchase more shares of the inventory, or take the dividends in money. Reinvesting will let you own more shares, which contributes 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 history of 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 great investment regardless of whether you want to reinvest each of the dividends on hold on to this stock for quite a long time, or use the income generated throughout the dividends.

For much more detail on the subject read Investing in Dividend Stocks at Investopedia. To get a list of those stocks, see this collection out of 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 matched up through a site or market. Instead of going to a bank, the borrower receives a loan by an investor.

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