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At first 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 some time, its possible to create enough passive income you could quit your job or retire early.

Passive income can be a small divisive topic. In general, passive income is any money you make without putting in much effort. The money will flow in without too much being required of you. In some scenarios it might be long-term recurring income, and in other cases it could be short lived or inconsistent.

In some circumstances 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.

What qualifies as passive income is up for discussion. Most lists that youll find online will include things such as blogging, writing e-books, or creating your own course. Im not including those thoughts in this post because, in my opinion, they all require too much effort to be considered as passive.

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Blogging will always need on-going work, either by yourself or from other people that youre paying.  Selling ebooks or classes will require on-going customer support, plus youll need a consistent traffic source in order to continue to create sales. It's possible and there are people who've been able to do it , but they make up 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 make money, I simply dont consider them to be more passive, in the majority of cases. .

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

Now lets have a look at a few of the best ways to produce passive income. Some of them are investments which will require some money to begin with. Others wont need any money to get started. If 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 should be to develop an emergency fund that can cover all your living expenses for a couple months. But dont put this money is a checking or savings account at a local bank which pays you a terrible interest rate. You can open a high yield savings account or money market account with an online bank which will earn a much greater 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 simple, 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 this stock, or take the dividends in cash. Reinvesting will let you own more shares, 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 her latest blog stock market in general.

Dividend stocks can be a great investment whether or not you want to reinvest all of the dividends on hold on to this stock for a long time, or use the income produced through the dividends.

For far more detail on the topic read Investing in Dividend Stocks in Investopedia. For a list of these stocks, see this collection out of Dividend.com and this collection from DividendValueBuilder.com.

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Peer-to-peer lending (or P2P) has become extremely popular in recent decades. Creditors and lenders can be matched up through a website or marketplace. Instead of going important site 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 debtor gets a better interest rate than they might get from a bank. As an investor, you can earn a great return as well.