Researchers have even pinpointed a statistic: millionaires, on average, have not just one, but seven streams of income. Now, a few questions came to mind.

First, is seven the magical number of income streams that turns you into a millionaire, or is it that the millionaire knows how important multiple streams of income are, and so begins to “collect” them?

Second, are those seven types of streams, or could those seven streams be in the same category (for example, real estate)?

Finally, do highly paid professionals really need this many streams of income or should they just keep working hard in their given profession? All these issues will be addressed in this article.

• What Are 7 Streams of Income?
• How Many Streams of Income Does The Average Person Have?
• How Many Income Streams Should I Have?
• 10 Passive Income Ideas to Help You Make Money in 2022
• Most Common Multiple Income Stream
• 3 Ways to Generate Different Sources of Income
• Passive Income Stocks
• How Many Streams of Income do Billionaires Have?
• Passive Income Ideas in India
• 7 Streams of Income Quote

What Are 7 Streams of Income?

Many of these are not available to everyone. You need to have money already to benefit from some of these income streams.

1. Earned Income

Earned income is your primary income stream through a job. The majority of us start here, and many go no further. For most, earned income is very limiting and has attracted the acronym, Just Over Broke!

Read Also: Become A Successful Event Manager To Earn Income

In other words, you earn just enough to survive. Of course, some jobs pay exceptionally well, but these are exceptions, not the norm. To go beyond a job and start your own business requires taking risks and moving into profit income.

2. Profit Income

By selling a service or products for more than they cost you is the basis of profit income. You could open a retail store and sell products, offer professional services and charge for your time, or combine the two.

It is one of the hardest steps to move from earned income to profit income, but it is the dream of many employees. Becoming self-employed or an entrepreneur can be a difficult road, and there are risks. 

3. Interest Income

If you or your business has spare cash sitting in the bank account, it is losing money. There are many ways you can put your money to work and earn a passive income stream. 

Maybe invest it in a savings scheme and use the power of compound interest to gain a passive income. Buying government bonds is another safe investment that will generate interest.

4. Dividend Income

When you buy shares in a company, you become part-owner of that company and entitled to dividend payments. Well-timed investments in companies can generate excellent passive income streams.

5. Rental Income

Property investment is an excellent way of protecting your money and generating an income from rent. There are two downsides to this income stream. First, it requires a substantial investment initially, unless it is part of an investment scheme. Second, releasing the cash can be time-consuming and costly, so if you may need the money quickly, this is not for you.

6. Capital Gains Income

Buying and selling assets can provide you with an income known as capital gains. For example, if you buy stocks and shares worth $100 and then sell them on for $120, the capital gain is $20. 

It is essential to consult an accountant first about capital gains, as each country has different rules. Depending on the asset sold, the capital gains tax may wipe out all of your profit.

7. Royalty Income

This is a passive income stream generated by designing, building, or making something unique and charging people and businesses to use it. Musicians are a prime example. In most cases, musicians are signed to a particular label, such as Virgin Records. The record company pays to record the musicians, produce the records, market them, and sell them. 

The musicians receive a royalty payment for every album sold and every time it is played to the public. Famous musicians, such as Elton John, make millions from the royalties for playing his music.

How Many Streams of Income Does The Average Person Have?

The goal of creating multiple income streams should be to maximize your potential in each category available to you.  If you are just starting out, it really isn’t reasonable to expect you to generate tons of rental income.  However, if you start maximizing your income-generating potential through your primary salary, you will find yourself having excess income that you can reinvest to generate additional income streams and earn more money.

Remember, the average millionaire has 7 different income streams.

The point is that you can diversify your income in various ways.  You can basically choose one of each from the categories above, and create a very diversified income portfolio.

The other point is that it is pretty easy to get started. You don’t need to be super rich, and you don’t need a lot of time to get started. To say it requires no time would be a lie, but you don’t need to make anything listed above your life. 

You can work at your job, invest your excess income, save to buy a rental property or rent out a room in your current house, and you start a side job online without breaking a sweat.

How Many Income Streams Should I Have?

The more income streams, the better, but not to the point you are running yourself ragged. Millionaires typically have at least seven different income streams.

But no one goes from having one income stream and then the next day having seven. It takes time to build up seven income streams.

You may find that for your goals, four or five income streams is enough, or you may want more than seven. There is no one right answer for how many income streams you should have; the best answer is that you should have more than one. Why?

Because, “52% of Americans could not cover an emergency expense of $400 without selling something or borrowing money. (wallethacks.com)” That’s pretty crazy.

But a digital product selling on autopilot could potentially cover that, letting you relax a bit. 

10 Passive Income Ideas to Help You Make Money in 2022

This pandemic has had an incredibly negative impact on the economy and livelihoods. If you’re one of the millions of Americans who lost their jobs, it might be time to start earning passive income. Here is the list of the best passive income ideas and opportunities that can boost your income in 2022.

1. Passive Income Through Stock Investment

Owning stocks and bonds to many doesn’t seem like one of the best passive income ideas. Yet this is the very basis of private retirement accounts. You’re buying stocks, bonds, and mutual funds that contain both so that you can live off the passive income in retirement.

Companies need money to finance their business so they earn it by either borrowing or sharing stocks through an IPO. An initial public offering (IPO) refers to the process of offering shares of a private corporation to the public in a new stock issuance.

Investing in stocks of a company, you become one of its “owners”. When the market is down, this is the best time to buy stocks.  If you aggressively save money and seek good-value, dividend-paying stocks, you may be able to achieve a solid passive income before the traditional retirement age. Diversify your holdings to reduce the risk of losing everything because a company cratered.

We have separated this from investment in bonds because of the nature of the two. In the previous paragraph, it was mentioned that this is a share of ownership of a certain entity. Some entities pay their stockholders every quarter so it is an excellent way of making a living without doing anything. But you have to be careful in choosing the company to invest in.

2. Passive Income Through Cash Back Websites

Earning a passive income through cashback websites is as passive an income method as any. You just need to go about your life as you normally would but with a little more focus on the things that you decide to buy. Cash-back websites combine spending money with earning money. This may not be considered as something that will help you go to early retirement.

But you can still earn money with no effort required from you. Not to mention that this is completely free. All you have to do is sign up for cashback on shopping websites. These shopping portals return to members a percentage of the total amount that they spend on their qualifying purchases.

For example, you can use Swagbucks to get cashback. Just use its shopping portal to buy items online or add the Swagbucks browser plug-in to get points automatically as you browse the web.

According to the company, it has paid out over $400,000,000 to members. Countless members have earned as much as $12,000 using Swagbucks. It is even a safe way for teens to make a little pocket money.

Another example is MyPoints, which gives you a few different ways to earn points. To get cash back, you can use their shopping portal and earn points by buying anything from one of their partner stores. You can also get points by taking surveys, watching videos, playing games, and even reading emails.

TopCashback is slightly different as they give the full commission back to customers and make their money elsewhere. You’re able to earn 3% consistently, which may not sound like much, but is a high percentage to be earned across all sites. There are also coupons you can find and special offers that give higher cashback.

3. Selling Stock Photos Online

Stock photos can be a good passive income source if you love to take tons of pictures. You can get paid to sell photos online through stock photography websites such as Shutterstock. The photos can be from any niche such as travel, food, or any sports that you like to cover. You can put your images for sale as an independent photographer on various stock photography websites.

While this can take time to build up if you take thousands of good pictures but you would enjoy the whole process and time spent if love taking photos. After all one of the goals of financial independence is to build wealth that doesn’t eat up your time, so you can enjoy life and do the things you like to do. This is a great passive income idea because it pays you to do what you want to do anyway.

Here are some of the best stock photography sites where you can sell your images and photos online for passive income. You can open an account and get started creating this passive income stream.

• Depositphotos
• SmugMug Pro
• Shutterstock
• Pixabay
• iStock Photo
• Etsy
• Getty Images
• Stocksy
• Adobe Stock
• Twenty20

4. Amazon FBA

Amazon has become a great source of passive income for people who want to generate extra income for themselves. If you have something to sell online, you can use Amazon’s platform. Amazon is huge. It’s the third-biggest website in the US. Amazon also offers a couple of different fulfillment strategies such as the “Fulfillment by Amazon” platform – also known as FBA.

Its FBA program is just like eBay, where you have something to sell and just need to find buyers. The major benefit of using FBA is that you don’t have to worry about a thing. Amazon stores your inventory at their massive warehouses and does all of the picking, packing, and shipping. Around the world, Amazon has more than 175 fulfillment centers which contain more than 150 million square feet of storage space.

With FBA, you get to store your stuff on those shelves. You also get Amazon’s world-class customer service and returns, along with other advantages (like automatic Prime eligibility and Free Super Saver Shipping) that help you scale your business—fast. The other option allows sellers to fulfill their own orders. Each method comes with its own pros and cons.

Steps to start making passive income through Amazon FBA.

1. Find some unique/profitable products to sell.
2. Something which has good demand but is not commonly available at offline retail marketplaces.
3. Find the suppliers of those products.
4. Remember that you need to buy low and sell high to have a reasonable profit margin.
5. List these products on Amazon through your seller account and set the prices.
6. You need to have a competitive pricing strategy to compete with other sellers on Amazon.
7. Use the right product titles and descriptions on the listing page.
8.  Try to think about what will best help customers find your products, discover answers to their questions, and make a purchasing decision.
9. Ship all of the items to Amazon at one time.
10. Amazon takes responsibility for the packaging, labeling, and shipping of products through Fulfillment by Amazon (FBA).
11. Amazon collects payment, deducts their fees, and then sends you money twice per month.

Once you’ve launched your business, Amazon has tools in place to help you take your business to the next level. Amazon’s advertising solutions create new ways for you to reach and engage shoppers, regardless of whether they’re just starting to compare products, or ready to make a purchase. Ads show up right where customers will see them (like the first page of search results or product detail pages).

Please note that the sales are passive, the work isn’t. Here are a few things to try in your first 90 days as an Amazon seller.

• Keep an eye on your account health in Seller Central
• Use Fulfillment by Amazon or Seller Fulfilled Prime
• Advertise your listings or offer deals and coupons
• Enroll in Brand Registry and create enhanced brand content
• Expand your selection by listing more products
• Use the Automate Pricing Tool in Seller Central

5. Lending Money To Others For Interest-Based Income

One of the best passive income ideas is to loan money to others and get paid in the form of interest. We’re not saying to loan money to a broke friend who never pays you back. As a private lender, you can lend to anyone in your social circle. For example, many home fix and flip investors need access to a source of capital they can tap into very quickly to fund the initial purchase of their properties.

You can partner with them to use your capital for the short term in exchange for an interest rate that is mutually agreed upon. You can also utilize peer-to-peer lending sites to loan money to others. The lending site collects the payments and provides more leverage when someone is late. You as a lender can lower your risk by diversification.

Simply lend money to a variety of people instead of putting all of your money, literally, in one basket. It is a wise strategy if you’re pursuing higher yields that beat stock market returns.

This is probably one of the few passive income ideas that involve high risks. But it is quite profitable. You can lend money to people who cannot qualify for conventional financing means. You could lend money with an interest of 6 to 10%. A good way to lessen your financial exposure is by investing in a company that will act as a mediator. They will ensure that you are paid back.

Another easy passive income idea through lending is called peer-to-peer lending in which you can give loans to other individuals who don’t meet all requirements for conventional financing. A crowd lending website is where you become someone who loans out money and you get paid interest. You’re like a bank now, getting paid interest.

It’s an awesome feeling to be the lender instead of the borrower. You invest in portions of loans. With returns of 6-10%, investing with a company like Lending Club can get you substantially higher passive income than normal investment funds or bank interests.

6. Earning Passive Income As Silent Business Partner

One of the best passive income ideas most people have never heard of is becoming a silent partner in a business. Instead of lending the business money, you buy a stake in the business. Then you’re paid a percentage of the profits, and your money is backed by a percentage of the assets of the firm. There are sites where you can search for businesses seeking silent partners.

Instead of giving a friend thousands of dollars for a 10 percent stake in their restaurant, you can choose from thousands of startups or small businesses for one that looks good to you. Moreover, you can reduce your risk by investing in several startups.

This is one of the best passive income ideas for those who were thinking of starting their own business but decided they didn’t want to do all the work. Know that passive income ideas like this require doing your due diligence, vetting the business’ numbers, and verifying that your rights as an investor are protected. You can also bankroll the business of your friend or family. They will then be able to run the business for you.

If this is an ongoing operation, you must study their financial statements and other aspects of their business before shelling out anything. But if you are investing in a new entity, you must know if your business partner is trustworthy. Although this does not lessen your financial exposure, you can sleep peacefully at night knowing that your money is in safe hands.

7. Starting A Blog & Monetizing It

The passive income through blogging has allowed many to stop exchanging time for money. For example, as a travel blogger, you can set up a WordPress blog and share your experiences with your readers.

Whenever you go to a new place, you can write about all the cool things you saw and did there. You can make money in a few different ways. You can apply for ad programs like Google Adsense and set them up on the sidebar of your site.

If any of them click through, you will get a small fee from your advertising partner like Google. You can also sign up for some of the affiliate programs. As mentioned above affiliate marketing is one of the various ways to make money online by promoting products or websites to earn a certain percentage as a commission.

8. Affiliate Marketing

Blogging is often seen as a great way to earn almost passive income. If you run a blog and get decent traffic, you can incorporate ads to your site and get paid per click or view on each ad. If you have a lot of traffic, this can add up to a decent chunk of change. Basically, affiliate marketing involves promoting products and getting a cut of sales.

All you have to do is put a link to a product on your blog, website, or social media page and then start earning money This isn’t completely passive income; you have to create content that will attract enough viewers for the ad revenue on the blog to be worth the effort. You have to write content, but you can hire others to write content for you, as well.

You can use software to schedule posts to be published when your readers expect new content. General ad revenue for blogs has been declining due to sheer competition. The alternative for bloggers is affiliating the blog. For example, a Mommy blogger could be paid to review various baby products, though she’s legally required to disclose the relationship.

You could mention sponsors and post a link to their site or products for sale. On the other hand, you could do it yourself, doing product reviews, and sharing affiliate links to the product Amazon. Then you receive a few percent of every sale as a commission. This is one of the best passive income ideas for those blogging consistently about a topic for which they can recommend related products.

This is one of the passive income ideas that do not require any investment from you. This would be an excellent money-making venture especially if you already have an existing website and a band of loyal followers. In this scenario, you post a link that will send the viewer to a certain website where they can buy the item. If they do purchase, you get a commission.

A lot of new things have come up in affiliate marketing. For example, you could promote or run ads in an app you create. Or you could mention sponsors that helped pay for your blog or provided expert advice for your online course. That’s aside from the classic approach of putting affiliate links in a blog or emailed newsletter.

One of the new passive income ideas is using various tools to set up affiliate programs on a one-to-one basis, whether you’re referring people to someone else’s online course or sending leads to a real estate agent.

Then there are the relatively classic passive income ideas like promoting books and products via an Amazon affiliate link. This is an option even if the app exists solely to connect your audience with you as an influencer. Promote your blog posts or podcast, and you can occasionally send out a link to your ebook or someone else’s book offered through the Amazon affiliate program.

You can also buy blogs/websites that already have a good amount of traffic and generate revenue every month. Thousands of websites are created every year and put for sale by the owners. If you can buy them with a reasonable amount of web traffic — as well as a demonstrated cash flow — it could be a perfect passive income source. Most blogs employ Google AdSense, which provides a monthly revenue stream based on ads that Google places on the site.

There may also be affiliate programs like Amazon Affiliate generating additional revenue. Both income sources will be yours once you purchase the blog. From a financial perspective, blogs usually sell for 24 times their monthly income.

So if the site generates $250 a month in income, you can likely buy it for no more than $3,000. You can buy money-making websites/blogs from sites such as Flippa.com and EmpireFlippers.com.

9. Money Making Websites

Many blogs earn revenue from Google ads. Some may have affiliate income as we described above. What most don’t know is that you can buy blogs from the owners and take them over.

The ideal cases have evergreen content that generates passive income for years. Add some fresh content, and you’ll increase traffic and monthly revenue. This also raises the possibility of earning money with site flipping.

Alternatively, you can build a niche blog that targets a small subset of the blog’s audience, increasing its value to the audience and advertisers. You can even increase traffic to all of your blogs by cross-linking to each of them. This is one of the better passive income ideas for those who want to do more than a blog on the same subject every day.

10. Renting Your Car

You can make passive income from renting your secondary car on popular car rental apps that put car owners in touch with car renters. You can offer a slight discount to increase your car’s demand and set a minimum amount of rental days to ensure you make get more money for your time.

So, this is one of the most passive ways you can make an extra income online at the moment if you have a car you can rent for cash.

You can make several hundred dollars a month renting your car on those platforms. For example, Getaround is a car-sharing app that allows car owners to connect to people who need to rent a vehicle. Similarly, you can cover your monthly car payments or simply earn some extra cash by sharing your primary car on Turo whenever you’re not using it.

That is a pretty good return since you can recover the entire cost of your car over a period of several months. Note that there are many things you can monetize this way. Not just a car. Depending on where you live, you could rent out your parking space for the money. You may be able to rent out tools that you own. The questions you have to ask are what you’re willing to lend out and what demand for these items is like in your area.

Most Common Multiple Income Stream

The two most common passive income streams are interest and dividends.

Interest can come from a variety of sources but the two biggest are from your interest-bearing deposit accounts (like a savings account) or loans, either to individuals (peer-to-peer lending or private notes) or companies (bonds, notes).

Interest is not super sexy to think about but it’s also something that requires very little effort. We make sure we put any savings into a high yield savings account and then never think about it again. It’s like getting cash back- on a credit card – you pick the card once and just get a small drip in return.

Dividends are payments from investments and partnerships. When you start, most of your investments will be in the stock market and you benefit from qualified dividends and their favorable tax treatment. As you expand your portfolio, you may enter into partnerships that make payments.

The holy grail of dividends is qualified dividends because they’re taxed at long-term capital gains rates, which is usually much lower than your ordinary-income rate. Not all dividends are qualified and the ones that aren’t will be taxed like interest.

3 Ways to Generate Different Sources of Income

There are three ways to earn multiple sources of income, and they are active income, passive income, and portfolio income. Each one takes different amounts of effort. You want to diversify your income streams similar to the way you would your investments. Check out these 3 ways to generate streams of income.

1. Increasing your income through active income streams

Active income is defined as the income you receive for performing a service or for trading your time for money. The money you earn from working for an employer or working in a business every day is a form of active income.

This is because you are trading your time and your services for the money you earn. Of course, active income is more time-consuming when it comes to creating multiple sources of income.

Examples of active income

Specific examples of active income include your paycheck, commissions, bonuses, and tips. You can increase your income through active income streams in the following ways:

1. Getting a better paying job in exchange for your time and skill
2. Getting a part-time job in addition to your full-time job
3. Starting a side hustle or full-fledged business
4. Increasing the prices you charge in exchange for your time and services if you are a business owner

Check out these popular work-from-home jobs as a way to add on a part-time or even new full-time job!

2. Increasing your income through passive income streams

Passive income is defined as income your assets earn for you without exchanging your time or services for it, i.e., your active participation is not required and is commonly associated with real estate or business. For instance, receiving rent from real estate each month where no major effort has taken place for you to earn that money is a type of passive income.

Examples of passive income

More types of passive income include royalties, interest income paid on bank account balances, network marketing, affiliate marketing income, and other types of business income.

You can create multiple sources of income through passive income streams in the following ways:

1. Putting in the initial groundwork to add a passive income element to your business. For instance, an eCourse or automatically delivered service or product, e.g., a  book on Amazon. Something that does not require you to be involved after setting it up.
2. Become an affiliate for a product or service that you share with your network or audience base. Still, a 3rd party provides the service delivery, and you simply earn money for your referrals.
3. Investing in rental real estate and charging rents that not only cover your expenses but net you a profit.
4. Peer-to-peer lending (P2P) where you earn interest on the money you loan to others.

There are multiple streams of income ideas when it comes to passive income. The more you have the better!

3. Increasing your income through portfolio income streams

Portfolio income is income that you earn from your investments. For instance, the money you earn from selling stocks in your stock portfolio at a profit is considered portfolio income.

Examples of portfolio income

More specific examples of portfolio income include interest, capital gains, dividends, and royalties.

You can increase your income through portfolio income streams by investing in company stocks, bonds, and various types of stock market funds, with the goal of having your investments grow over time and, in turn, earning you portfolio income.

Passive Income Stocks

In financial terms, passive income describes money that a one-time investment continually generates, without requiring the investor to monitor or adjust their holdings. The passive investing strategies below warrant a closer look.

1. Real Estate

Despite fluctuations over the recent years, real estate persists as a preferred choice for investors looking to generate long-term returns. Specifically, rental properties can furnish apartment owners with a regular income source. The investor can easily acquire a property for a 20% down payment, then install reliable tenants who keep the money flowing.

Those who don’t want to manage rental properties can look to real estate investment trusts (REITs) instead. REITs payout 90% of their taxable income as dividends to investors. On the downside, dividends are taxed as ordinary income, which may be problematic for investors in higher tax brackets.

Real estate crowdfunding presents a middle-ground solution. Investors have their choice of equity or debt investments in both commercial and residential properties. Unlike REITs, crowdfunding lets investors enjoy the tax advantages of direct ownership—including the depreciation deduction, without the added responsibilities of property ownership.

2. Peer-to-Peer Lending

Although the peer-to-peer lending (P2P) industry (aka crowdfunding) is just over a decade old, it has grown by leaps and bounds. It is defined as the act of directly lending money to a person or a business entity, where lenders and the borrowers are connected via online platforms such as Prosper and LendingClub. Returns typically range from 7% to 12%, and there’s very little the investor must do after initially funding the loan.

P2P programs generally have fewer barriers to entry than other types of investments. For example, investors can fund loans with investments as small as $25. While Title III of the Jumpstart Our Business Startups (JOBS) Act allows both accredited and nonaccredited investors to invest through crowdfunding, each P2P platform has its own set of participation requirements.

3. Dividend Stocks

Dividend stocks are one of the simplest ways for investors to create passive income. As public companies generate profits, a portion of those earnings are siphoned off and funneled back to investors in the form of dividends. Investors can decide to pocket the cash or reinvest the money in additional shares.

Dividend yields can vary significantly from one company to the next, and they can also fluctuate from year to year. Investors unsure about which dividend-paying stocks to choose should stick to the ones that fit the dividend aristocrat label, which means the company has at least a 25-year track record of paying out substantial dividends.

4. Index Funds

Index funds are mutual funds or exchange-traded funds linked to a particular market index. These funds aim to mirror the performance of the underlying index they track and are passively managed.

Therefore, their underlying securities don’t change unless the composition of the index shifts. For investors, this translates to lower management costs and lower turnover rates, which makes them more tax-efficient vehicles than many other investments.

How Many Streams of Income do Billionaires Have?

Forget about a regular salary and a singular source of income; millionaires and billionaires usually have several streams of income, including:

• Earned income – This is the income earned by doing something. It is usually a regular job where you are working for someone else. This is how most billionaires start out, but over time many of them do away with earned income and focus on other sources.
• Profit income – Profit income is where you sell something for more than what it originally cost you. Profit income comes from businesses large and small and requires a degree of entrepreneurship. Most billionaires will always maintain some form of profit income because when done correctly, it can earn you huge amounts.
• Interest income – Interest is the money earned on lending money, usually to the bank, and allows you to earn a passive income with basically zero effort from your end. Most billionaires will have multiple streams of interest income coming in each month.
• Dividend income – Dividend income is the money you make by being a shareholder in certain companies. It is also passive, and you’ll get a return on your shares and investments. Most billionaires are very business savvy and have expert financial advisors who can accurately advise them about which businesses to invest in.
• Rental income – Rental income comes from buying property and renting it out. While buying a property can require quite a large amount of money upfront, over time, you’ll be able to make your investment back and start profiting off your rentals. There are numerous billionaires involved in the property and rental market.
• Capital Gains – This is the money you receive for any assets you own that increase in value. Billionaires are likely to own many such assets.
• Royalty Income – Royalties are paid out for allowing someone to use your idea, design or product. A good example is JK Rowling earning royalties for every copy of her books being sold. As these books will continue to sell for years to come, she’s likely to enjoy a healthy royalty income.

The thing is that most of these income sources are only really worthwhile if you already have a significant amount of money, and in this way, it is often easier for the mega-rich to become even richer. Almost all of the income streams listed above are very difficult for the average person to get into.

Passive Income Ideas in India

There are many types of passive income. Given below are some of the best passive income ideas:

Idea 1: Rental Income

Owning land, property or even storage space can be a great way of generating passive income. Many people become landlords. This means you work hard to collect whatever money is required to pay for your first rental property.

This is a difficult move in today’s economic situation. More importantly, there is very little liquidity in real estate. It isn’t the easiest or the safest path to passive income.

Idea 2: Mutual Funds

Investing in mutual funds is one of the best ways to generate passive income. You can choose mutual funds based on your risk appetite and timeframe.

This means you not only get to create wealth passively you also get to choose how much risk you are willing to take. If you have a trained professional to guide you through this process you can build the perfect portfolio for your financial goals.

Idea 3: Stock Investments

Investing in stocks is another brilliant way of creating passive income. This is, of course, something that requires a certain level of expertise and knowledge. While stocks can potentially generate a lot of passive income, it is best to invest in stocks under the guidance of an expert advisor.

Idea 4: Peer to Peer Lending

P2P lending is basically an alternative investment path. You will essentially be lending money to borrowers and earn interest on top of it. It is best to invest in P2P lending through an established mediator. This way you invest money but reduce the risk associated with P2P lending by a huge margin.

Idea 5: Asset Leasing

Asset leasing allows you to earn passive income. You can become an investor who leases out tangible assets like cars, furniture, equipment, or intangible assets like copyrights.

As a lessor, you’ll receive an interest (passive income) along with the principal amount from the lessee for the duration of the lease.

Idea 6: Bank Fixed Deposit

This is one of the oldest ways of creating passive income. The interest you earn from a Bank FD is low. However, people who are extremely risk-averse tend to gravitate towards bank FDs due to the low-risk factor.

Read Also: Using Computer Repair Services to Make Money

If you’re willing to expand your horizons then you can invest in a liquid fund which is the type of mutual fund that offers high liquidity – this means your money can be taken in when you need it. Unlike Fixed Deposits, liquid funds do not have long lock-in periods.

7 Streams of Income Quote

#1 “My rich dad taught me to focus on passive income and spend my time acquiring the assets that provide passive or long-term residual income…passive income from capital gains, dividends, residual income from a business, rental income from real estate, and royalties.”

Robert Kiyosaki

#2 “You can only be financially free when your passive income exceeds your expenses.”

T. Harv Eker

#3 “If you don’t find a way to make money while you sleep, you will work until you die.”

Warren Buffett

#4 Compound interest is the 8th wonder of the world. He who understands it, earns it. He who doesn’t pays it.

Albert Einstein

#5 “The MOST effective way of bringing in passive income is educating people.”

Jess Van Den

#6 “Residual income means NEVER having to start over.”

Tom “Big Al” Schreiter

#7 “NEVER depend on a single income.”

Warren Buffett

Finally

You would hardly find any wealthy billionaire with an income stream only from the ‘Earned Income’ category. 

And the reason for the same is very simple: This stream is where our time utilization is least efficient, and since there is a limit to the number of hours we can put in a day, there is also a limit to the amount of money we can earn from this stream of income. All other streams of income are not directly dependent on time and hence can leverage time well to generate huge wealth.

So go on, chose your streams. The biggest risk to your financial life is being dependent on only one income stream where you are actively involved. Each of these streams is one step above the other. You just need to get into the details and understand them more. Try it out. It could well be life-changing for you and your upcoming generations.