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Initially you may only be making a tiny amount of money passively, and you might even want to re-invest that money so it compounds and grows faster. However, with a few time, its possible to make 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 that you earn without putting in much effort. The money will flow in without too much being required of you. In some cases it could be long-term recurring income, and in some other instances it could be short lived or inconsistent.

In some circumstances youll need to put in some effort up front, but then it wont require as much effort in the long run when youre making the money.

Exactly 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 thoughts in this post because, in my opinion, all of them require too much effort to be considered as passive.

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Blogging will always need on-going work, either by yourself or by other people that youre paying.  Selling ebooks or courses will require on-going customer support, plus youll need a consistent traffic source in order to continue to make sales. It's possible and there are individuals who've 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 years and Ive sold ebooks and classes in the past. Theyre great ways to make money, I just dont consider these to be more passive, in most cases. .

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Just about 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 that which will be listed here.

Now lets take a look at a few of the greatest ways to produce passive income. A number of these are investments that will need some money to start with. Others wont require any money to begin. In case you dont have the money to invest now, consider starting with the approaches that dont require any money, and then use that money you earn to invest. .

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Your very first financial priority must be to build up an emergency fund that will cover all your living expenses for a couple months. But dont put this money would be a checking or savings account at a local bank which pays you a horrible interest rate. You can open a high yield savings account or money market account with an online bank that will earn a lot better return for you. that site

My wife and I maintain 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 buy more shares of this stock, or take the dividends in cash. Reinvesting will let you own more stocks, 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. As a result of this, these investments tend to be considered less risky than the stock exchange in general.

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

For much more detail on the topic read Investing in Dividend Stocks in Investopedia. For 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) has become extremely popular in recent years. Creditors and lenders can be matched up through a site or marketplace. 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 qualify for a loan through a traditional bank. And in many circumstances the debtor gets a better interest rate than Resources they could receive from a bank. As an investor, you can earn a great return as well.