It’s 2021 and coronavirus still creates problems for world economies. This is the reason why so many of us are thinking about passive income as an alternative way of earning money.

Passive income can help you achieve financial freedom and get paid while doing nothing. Really? Well, no. You do need to invest some time and money at first but passive income is achievable.

It doesn’t matter if you’re a business owner or someone who wants more flexibility during the week. There are lots of possibilities for getting paid while doing nothing (ok, again, not exactly nothing, but bear with me). 

This could mean finding tools or passive income apps that can save you time or starting with a project that will generate a steady income over time.

In this article, I’ll go over some basic concepts regarding passive income and show you what are the best passive income ideas, but let's see what is passive income in the first place.

What Is Passive Income?

Usually, the best way to grasp a concept is by understanding its antithesis - active income (I don’t know if this is the best way but it's an easier way for me to explain it). 

Active income is what you get from doing an “actual job”. In other words, if you’re an architect, software engineer, or firefighter, your salary is your active income.

However, a lot of people struggle with paying their mortgage, bills, etc with the salary from their regular jobs. This is precisely the reason why 13 million American workers have additional job.   

Since COVID 19 started, many companies were forced to shut down departments, decrease salaries, etc. As a result, many people were forced to find other ways for making money. 

On the other hand, businesses were forced to think strategically in terms of streamlining their paperwork and using more efficient tools for managing invoices, simplifying accounting processes, etc.

Luckily, there are plenty of ideas out there that can help you with these and similar problems. Keep reading to learn more about some helpful tips for improving your business and your finances. 

1. Point of Sale Terminal (POS Terminal)

POS terminal is a machine that helps your customers to make payments via payment cards i.e. credit cards, gift cards, etc.). Installing a POS machine can help your business significantly by reducing the need for handling cash by your employees. 

Another benefit of POS devices is the increase in business revenue because of their efficiency. Your customers don’t need to carry actual cash and as a result, the transactions are much faster. 

Also, since everything is programmed, there is no need for personnel that handles the payment. You are boosting your business and saving money. 

A typical POS terminal reads info from your client’s credit cards, checks their bank accounts, or transfers their funds to your account. Another benefit is that every transaction is recorded. 

As a business owner, you should seriously consider implementing this idea since it is estimated that by 2026, there will be around 22 million units of POS just in Europe. Make sure to follow the latest payment trends that can help your business in the future. 

2. Affiliate Marketing

Everybody knows that marketing is crucial for maintaining a business. The question is, what kind of marketing strategy should you adopt to achieve the best results. For example, should you start with affiliate marketing or referral marketing?

One of the most popular ways of creating passive income is by using affiliate marketing. In short, affiliate marketing is a marketing model where a business pays publishers (websites, blogs, etc) to create traffic to their products or services.

For example, you could read an article on a website that has a link to the product that is selling on Amazon. The owner of the website earns a commission by recommending their readers (who are becoming customers) certain products or services.

Getting commission on a regular basis is one of the easiest passive income ideas. Of course, you need an audience, which means you need to put some effort into creating a website, figuring out your audience, etc. 

Many business owners are starting to use social media since it's a proven way of bringing attention to your product or services. A great way to boost your business and increase the visibility of your products or services is to use Instagram marketing

If you want to know more about tools and methods that can improve your marketing or want to improve your team’s productivity, there are startup and marketing advisory teams that can assist you.

3. Streamlining Your Payments

Working with freelancers could become a necessity for the majority of business owners. There are almost 60 million freelancers in the US alone. 

A survey from Upwork showed that there is a tendency towards freelancing among workers faced with a choice of working remotely:

By simplifying your paying processes you will surely save money. It goes without saying that managing invoices are crucial when it comes to tracking deadlines, defining the payment terms, etc. 

There are many useful invoicing tips for business owners but the most important one is to use a professional invoice. There are many options available like recommending the tools for creating commercial or proforma invoices to your clients. 


Another passive income idea is to invest. Investing is a vast area of different styles and methods. Before making an investment, it would be wise to create a killer investment strategy and find out which assets are right for your portfolio.

4. Real Estate

 Investing in real estate is not a typical passive income idea since it's more complicated than other ways of earning money. Another problem is that you need capital for investment from the start for purchasing or restoring your rental property.

There are some ways for getting into the real estate business without spending too much money. For example, you can buy property by paying a partial cost. 

This is possible if you use leverage as an investment strategy, which means using borrowed capital for funding purposes.  

Some people think that a real estate business is not generating passive income since you do need to maintain the property from time to time. However, it's a totally different activity than having a standard job.

There are different real estate investment trusts (REITs) that can provide you with an investment opportunity. For a company to qualify as REIT, real estate companies have to meet certain criteria.


It is estimated that around 145 million Americans own REITs in some way. REITs give you an opportunity to invest in a similar fashion as in other industries. You can purchase company stock, invest in a mutual fund or exchange-traded fund (ETF). 

This leads me to my next passive income idea - stocks.

5. Stocks

A stock represents ownership of a part of a company which is why its units are called shares. The share of the company that you own is in proportion to the company's assets and profits you’re entitled to.

Usually, stocks are traded on a stock exchange which is defined and controlled through government regulations. There are many trading platforms that you can use to buy stocks and start trading. 

Have in mind that trading stocks come with risks. The stocks you have purchased will fluctuate in value, which is why you need to decide on your trading strategy from the beginning. 

Usually, there are two strategies: You can start with big companies that are stable, whose stock value doesn’t fluctuate that much. This is a long-term strategy, meaning, you'll have to wait a bit to have profit.

On the other hand, going with small companies with growth stocks will guarantee faster returns but (as with everything in life) that comes with a cost. The risks are greater.

There isn’t a “right” strategy but there needs to be a strategy of some sort just like with bonds which is my next topic.

6. Bonds

Bonds are loans in essence. Typically, a large company or government is taking loans through bonds in order to finance their projects. The owner of a bond is called a debtholder (which is a scary word, if you ask me) or a creditor (which is a better word, if you ask me).

Just like with a typical loan, a bond comes with a deadline for its payment. There is a variable of fixed interest depending on the agreed terms. Every bond comes with an initial price.

Its market price depends on a number of factors. There’s the creditworthiness of an issuer, the period before the expiration of the bond, etc. 

In the end, it is the face value of the bond that the borrower receives when a bond matures (I know how it sounds, but this is the investment jargon, you’ll have to get used to it). However, you don’t need to wait that long. 

7. Starting Your Online Store

Purchasing online has become a necessity during a pandemic. Just last year, US consumers spent around 860 million dollars online. Even though times are harsh, there is a gap in the online market, which is an opportunity every marketer wants to seize.  

Online shopping is a favorite activity of parents (think of their parents who ordered stuff via phone) and young people are adopting similar habits. There is no turning back, which is why an online store is a way to go when it comes to passive income.

There are a couple of things you need to do to start an online store. You need a domain name which is a website address. It reflects your business, which is why it needs to be related and short. 

The next thing is to create a website or use some of the popular e-commerce platforms. 

Those platforms are convenient because of their practicality and simplicity (you don't need coding experience, for example). However, you need to pay a fee, there are limitations in their design, etc.

The next step is the marketing strategy. Pick an audience, ask yourself what is unique about your product or service and create a narrative around that feature. Conduct thorough research of your competition i.e. existing online stores in your niche. 

In the end, you’ll need some good old SEO. If you want people to find your products or services, your website needs to be optimized. This means attracting customers through SEO techniques (researching specific keywords, scheduling posts, etc).

Final Thoughts

Passive income is real (just like COVID 19) which is why you should (if you can) start implementing some of the previous ideas. 

Have in mind that it doesn’t matter if you start by investing in stocks or getting into affiliate marketing. You’ll need to put a lot of work into that project in order to achieve results.

I hope these passive income ideas were inspiring and will help you get more money in these harsh times.