Learn passive income ideas to pay the rent in the least expensive states and the strategies for generating money while you sleep!
Hey Bow Tie Nation, we are following up on a video a few months ago highlighting seven monthly dividend stocks to pay your rent. That video immediately became one of the most popular on the channel but there was one thing I hated about it!
You see, even with an amazing dividend yield of 9.7% on those seven stocks, you’d still need almost $250,000 invested to make a $2,000 monthly rent payment.
And that’s on a yield more than six-times the market average. If you’ve got a quarter of a million dollars stashed away in dividend stocks, you’re worried about the color of the umbrella in your coconut drink…not about paying the rent.
So for this video, I wanted to fix that problem, make this a video anyone can use and show you the nine passive income ideas you can start today that will cash flow fast! We’ll be using the average rent for each state and revealing passive income strategies for each to pay that amount. Stick around to see your state or watch to the end to see which income ideas make the most money!
I’ll be using data from rentdata.org for a three-bedroom apartment in each state. Now if you have too many kids and need more rooms, there is good news, scientists think they’ve uncovered what causes babies…so you might want to look into that.
We’ll start with passive income ideas to pay the rent in the least expensive states and work our way up. These are all going to be ways to make money that won’t involve constant work but some do take time to develop. I’ll leave links in the video description on how to develop each but if you need fast cash, I’ll also leave a link to a side hustle video for ideas that make money immediately!
9 Passive Income Ideas You Can Start Today
Our first group, and God bless the cheap seats, we’ve got an average rent under $1000 a month, so if you don’t mind corn and cows, it’s a great place to live!
And the first way you’re going to do this is by taking advantage of the shared economy.
Now most people have heard of AirBnb, the idea of renting out a room in your house to travelers but this goes way beyond that and most don’t involve inviting Charles Manson to be a house guest.
I’m talking apps like wrapify where you can earn up to $450 a month for selling ad space on your car and just driving around like you normally do. Or letting someone use your driveway through Neighbor.com for up to $150 per month. Renting out your car for as little as seven days a month can net you as much as $10,500 a year through Turo.com.
Nation, there is an app and passive income here for all levels of sharing from renting a room to sharing your driveway or parking spot, to renting your car and even renting out your clothes…though I’m not sure I’m quite ready to let this guy wear my jeans just yet.
Now most of these aren’t going to get you to that thousand a month unless you’re taking a more active role but you can combine a couple of the more passive ones to build up your income. If you average $250 a month from Wrapify and $500 from renting out your car a few days and another couple hundred from other apps, you’ve got your rent paid for with little or no work.
I’ve just started using this next passive income strategy and really like how it’s turning out, collecting interest on cryptocurrency platforms.
There is a huge demand for lending cryptocurrency and stablecoins right now so platforms like BlockFi are paying interest rates up to 8% on accounts. It’s a lot like what a traditional bank does with your savings, paying you interest and then loans it out on mortgages…except the rate BlockFi is paying out right now is more than 100-times the average .06% rate you get from the bank.
And you don’t have to be a believer in cryptocurrencies to use this as a passive source of income. These are the rates BlockFi pays on different tokens and you’ll see, the stablecoins like USDC, are paid the highest rates. Stablecoins are backed by assets like commercial paper and money market funds to hold their value to the U.S. dollar and you can see in this price chart, it stays almost exactly at that $1 each.
Of the passive income ideas I’ll highlight, this is one of the easiest. You can transfer directly from your bank to BlockFi and you’ll earn interest daily from your crypto and stablecoin holdings. I earn just over $25 a day or about $750 a month from this source alone, and that’s interest on my stablecoins as well as my investments in bitcoin and Ethereum.
We’re moving on up for our next group, maybe not to that penthouse apartment in the sky, but to rents just over a thousand a month.
I’m just getting started in earning interest on crypto so I wanted to share a passive idea that I’ve used for quite a while, self-publishing on Amazon or shorter printables.
Those of you in the community for a while, you know this is the income source that enabled me to go full-time with my online business. I’ve been self-publishing on Amazon since 2015 and tracking each month’s income. You can see, even my first book, published six years ago, is still making money every single month. I average just over $1,500 a month through self-publishing and have made over $123,000 total in those six years!
Best of all though, that first book took just a few months to write and was cash flowing immediately. From there, I was able to grow that income source to over a thousand a month within a year so this is going to be one of the fastest on our passive income list.
Honestly folks, everyone has a book idea in them because you have your own unique set of experiences and talents that I guarantee you, someone else wants to read about.
And this is a lot easier to do than you imagine. I’ll link to a complete video in the description but this process will get you started. For a non-fiction book, start with what you want people to be able to do or learn then break it down into 10 to 15 tasks, working backwards to that goal. Each one of those is going to be a chapter so you do the same within each chapter, break it down into a few tasks and instructions in each. Then you focus on one chapter a week, don’t try to sit down and write a book, just do one chapter at a time.
This next passive source, staking cryptocurrencies, is another one I’ve just started to experiment with and is also one of the most passive on the list.
I don’t want to get too technical because this really is an easy income source but there are two ways the blockchain technology works. The proof-of-work which is the mining model used by bitcoin and the proof-of-stake model which validates changes on the shared spreadsheet by putting up tokens as collateral. When you stake your crypto, you’re becoming a part of the process and get rewarded with more coins.
To start this individually, you need a dedicated computer and a larger account, like at least 32 Ethereum or about ninety-grand, but most exchanges like Coinbase will allow you to add your cryptocurrency to a pool of investors and do all the work for you.
Joining the staking pool, you can earn from 5% to as high as 20% depending on the coin and exchange you use. Rewards for staking are forecasted to top $12.5 billion this year and JP Morgan expects that to grow to $40 billion by 2025.
We’ve still got five more passive income ideas to highlight but I want to get your feedback on this as well. There’s a lot of disagreement over what’s really passive income, whether it’s something you have to set up with a little work or if it’s totally passive from the start. So let me know what do you think makes a passive income source and how much time would you be willing to set it up before it’s that recurring cash flow.
Our next group is the biggest yet, from Texas to Florida and New York…
Hold up here…the only three bedrooms in New York for $1,400 either looks like this or it’s a tenement under a bowling alley and above a meth lab.
OK, obviously these are statewide averages but we’re still getting up there with an average over $1,250 a month rent which means you’ll need to up your passive income game!
Vending machines are a $30 billion industry and that’s not including ATMs or touch-screen games, and it’s not as hard to set up as you might think.
First you’ll want to get a rough estimate of foot traffic around a location to help you estimate sales. Then list out all the current vending and food service options in the area. Contact whoever manages the location to see if they have a contract with a vendor and how long the contract goes…and especially if they’re happy with the vendor. Find out what commission they’re getting on vending sales and what other vending services you might be able to provide.
Machines cost anywhere from $500 to a few grand and you’ll need money to buy inventory so this isn’t something you can start with no money. You’ll want at least five machines to make it worth it but can expect between $40 to $70 a week in profit from each machine.
You’ll need insurance for theft, vandalism and when some yahoo tips a machine over on themselves. Running everything is pretty easy though. About once a week, you’ll check on your machines to restock, empty the cash box, refill the coin return and wipe down the glass.
I want to give you an online option here as well so let’s look at turning an affiliate website into a source of passive income.
An affiliate marketing blog is a website where your primary source of income is going to be mentioning products or courses and then getting a commission off sales of those. The pros of this are you don’t have to spend a lot of time creating your own products or courses. You just partner with other businesses and the products you believe in to promote theirs. This can also be a great passive income business because once you’ve got some articles on the blog that are pulling in traffic from Google, you’re going to get that traffic every single month whether you post new articles or not. You’ll get continuous visitors to the blog, a percentage of those visitors are going to click through your links and buy and you can make thousands a month on very little work.
We’ll go back to my revenue spreadsheet to show you just how much you can make and you see, I’ve averaged just under $20,000 a month through affiliate sales so far this year. That’s about a third of my total online income.
Now obviously that’s not all passive because I manage my websites and the channel actively as a business, but if I’m doing twenty-grand a month…you can definitely make fifteen-hundred to pay your rent.
Getting started here is even easier than that vending machine idea. First you pick a topic, something you like talking about like health or money, investing or home schooling. Any hobby or interest you have. Then you create that website and sign up on what’s called affiliate networks which are just websites that connect people with blogs to affiliate partnerships. In those affiliate networks like Share-a-Sale or CJAffiliates, you’ll sign up to affiliate programs which are just individual companies that want to promote their products. You’ll get a special link you can use whenever you talk about that product so if someone clicks on it from your blog, the company will track that person and know to give you a commission if they buy something.
I’ve got a couple of videos on setting up a blog and affiliate marketing that I’ll link to in the video description. Check those out because, whether you’re just doing this to pay the rent or want to make it a business, affiliate marketing can be a great income source.
Coming in second to last, from New Jersey to if you can find it on a map you can live in Delaware, for an average rent over $1,500 a month.
If our next passive income idea was good enough for George Jefferson, it’s good enough for me!
And anytime you can get two Jeffersons references in a single video, Ladies and Gentlemen, that’s a good day!
Running a laundromat is probably the second-highest paying on our list and surprisingly passive. The laundry business is a $5 billion industry in the United States alone with more than 35,000 laundromats nationwide. According to Martin Ray, an industry advisor, coin laundry startup costs typically range from a few thousand to $300,000 and generate between 20% to 30% return on investment annually. So startup costs can be high for this one but you can get a loan for the property and the machine operators will usually extend a line of credit on 10 to 15 year terms.
These places pretty much run themselves though you’ll still want someone on-hand to help customers. Adding additional services like a lounge can help boost your sales and produce an even higher return. I’ve even seen places that set up with a liquor license so they can make it a bar and laundry format, and with a margin around 80% for bars, it’s easy to see why.
Now I am not going to pretend to be a laundromat expert because this is one of the two on the list that I haven’t tried so I’m going to defer to Brandon from the Investment Joy channel on the details. Brandon is the King of the laundromat biz here on YouTube and actually owns three locations so check out his video I’ll link in the description.
While laundromats can make a massive amount of money, it’s also one of the more expensive for startup costs, so I want to highlight virtual conferences here as a less expensive passive income idea.
I did a whole video on this a couple years ago, detailing how a blogger friend made over $6,000 on one virtual summit…and that was before the ‘rona virus! This is how most conferences and annual events are happening now and a lot of people prefer it that way. It’s opened up a whole new income source because doing these virtually brings the startup costs down to something anyone can afford.
If you look at this, you can do everything virtually that you can do at a live conference. You invite experts to give 20 – 40 minute presentations, you can record panel discussions and you can present these live on the first day to include question and answer sessions.
And you can sell different levels of tickets to these. You’ve got one price to attend those live recordings and Q&A for the summit and you use Zoom or another video conferencing platform to manage this. Then you can sell another level of tickets for access to the recorded summit, so maybe people that couldn’t watch live or that want that recorded version, you sell this as a video course on Teachable. Beyond those ticket sales, you can also sell sponsorships to companies for brief promos during the presentations and mentions on social media.
I’ve participated in two of these as a speaker and they make so much money. Honestly, even a small virtual conference can easily make ten grand for the organizer and that’s profit after paying affiliates and speakers.
Now understand, unlike most of these income ideas, it’s going to take up to six months to put one of these together and then all your money will come in over a month or two so this is one you’ll need to plan out further in advance.
Last group here with an average rent over $2,000 a month for a three-bedroom and you know what, just move…seriously, I know you islanders love your sunsets but for two grand a month, move to Iowa and get a can of spray tan!
But…if you’re really set on where you live, I’ve got one last passive income idea that can make the big bucks and that’s why franchising is so popular.
When you buy a franchise, you pay a startup fee to an established business for everything you need including how to set your business up, equipment you’ll need, a local marketing budget and a brand that people already know.
More than 90% of the 37,000 McDonald’s locations are franchises and other examples include Marriot Hotels and Ace Hardware. These are all franchise businesses you can buy and run your own store locally.
How this falls into the passive income space is that so much is done for your and few franchisees actually manage their stores on a day-to-day basis. Now there is a price to having your entire business set up for you. Besides that startup fee which can range from ten thousand for smaller franchises to over a million-dollar commitment for a McDonalds, you typically have a per month commission on sales you have to pay into the corporate owner.
A franchise can still be profitable though. McDonald’s owners are estimated to average around $150,000 a year and that’s after paying for all the staff to run the place. Profitability margins shown here by SageWorks range from 1.5% of sales for Car Dealerships to over 10% profit on sales for Hotel businesses.
Read the Entire Creating Passive Income Series
- 7 Passive Income Ideas [Updated for $10K a Month]
- Definitive Guide to Passive Income Bond Investing
- How Long Term Stock Trading Helps For Your Retirement
- How to Create a Dividend Stocks Ladder and Live off Your Dividends
- The Great 2021 Real Estate Reset and the Only Properties I’m Buying