Everybody talks about passive income these days. Is it a scam?
Yes and no.
Nothing can exist passively for an unlimited time. Here’s what passive income really means: passive income is a more or less slowly dying income stream.
But the idea is still powerful and transformative. And there are a lot of income streams that are much more passive than others. If you nurture them correctly, they can provide you a steady stream of income for years, even decades.
Passive income is a perfectly solid route for many people. Indeed, selling your time for money is a bad long-term strategy because it makes you vulnerable. As soon as your services are not required anymore (for example, your company gets rid of you), your income vanishes. And you immediately lose all stability in your life.
An important argument against “active income” is that there are only 24 hours in the day — which creates an upper bound on the money you can expect to earn.
Building a second stream of passive and scalable income is the one thing you can do today to create a better and more robust future for you and your family.
So what are some good ways of generating passive income?
There are three different types of passive income you can generate but all of them boil down to a single thing. As you will see in a moment, this is the single thing that decides about your success in building a passive income stream.
It’s generating market attention. You need to generate traffic and market attention before you can expect to earn a single dollar.
Of course, if you managed to create sufficient market attention, there are different easy ways of monetizing it.
Passive Income Ideas
Here are some ideas to create income (for more ideas visit my other article).
- You can create ebooks and courses and sell them to your market.
- You can become an affiliate marketer who sells other people’s products. This may be the single most passive income stream there is because other people create and deliver the products — you only have to create the market attention — and getting paid for it.
- You can create ad revenue. If your blog attracts a lot of visitors, you can embed banner ads to immediately monetize your visitors. Usually, you get paid between $5 to $40 for every 1000 visitors seeing (or clicking) the banner ads.
You can see that all of them depend on your ability to create market attention. Therefore, you need to create a preferable free stream of never-ending traffic to your page.
Another excellent (but not so passive) way of generating passive income is to sell software.
You as a software developer have a huge advantage because you can use your skill in any niche you want. For example, if you love biking, you can create useful biking software (remember: you are one of the few bikers who also knows how to write software — so competition is very limited). Then, blog about biking and sell your software in your blog articles.
But again, you need to get the market attention!
Many people fall into the trap of focusing too much on the product. Then they polish it forever. They try to sell the product but nobody is buying it because they simply have no market attention. Finally, they give up and argue that it’s impossible to generate passive income online.
You need to create market attention.
This is the main takeaway of this article: Before you think about anything else (like the products you will sell), think about how to generate market attention.
For example, you can set up a blog and write articles that are tailored to specific keywords so that they rank high on Google. This generates a stream of never-ending traffic. After a few months, you can work on monetizing your consistent flow of traffic to your website.
Or you can create advertisements on Facebook that run independently from your time 24 hours a day, seven days a week, reaching thousands of coders in a profitable way. Just make sure the ads generate more revenue than you need to spend on them!
It’s possible to create a truly passive income. I certainly got there in less than a year of blogging and working on my website Finxter.com for learning Python. But it’s not easy, you have to create market attention. Focus on the right thing immediately!
How much traffic do you need to earn a full-time income online?
About 50,000 visitors per month should be sufficient.
If this looks overwhelming to you — it’s not. You simply need to write 50 articles which generate 1,000 visitors per month per article. It’s perfectly doable. If you write one article per week (on the side), you can create this kind of traffic within a year.
If you have managed to create 50,000 visitors per month, have a deep look at your articles. Which are the 20% of the articles that are visited by 80% of the people? Then you create an information product out of those. You simply create a book or a mini-course and sell them for $10-$50 right on your blog. A simple but robust business model that is proven to work for hundreds of thousands of bloggers.
The income is mostly passive — you just need to set it up and maintain the website which should be easy for you as a coder.
Then, after one year, you can move on to the next website and create the next seed of passive income (and virtually double your income in the second year).
You should select a very small niche to make sure that you don’t have a lot of competition. For example, the “learn Python” niche is much too broad. It takes decades to build a credible page with enough articles to compete with the top sites. So niche down and write all articles in your mini niche. Dominate this niche. Write about this niche as often as you can. Get some serious traffic. Then think about monetizing the niche.
It’s all about maximizing the value you bring to your users. That’s what made Finxter.com a success — I love bringing value to my users so they like sticking around and learning on the way. Focus on value and market attention!
Create an Active Stream of Income and Invest for Passive Income!
If you want to create a third stream of income (besides your passive income ideas and your main job), check out my course “How to reach Python freelance level in your coffee breaks”.
As a Python freelancer, you have complete control about your life and the money that comes in. You create a new high-income skill, work from the comfort of your own home, and you are very robust — able to replace your job income in a second.
Start now and create a second stream of income for yourself and your family! You can then invest the proceeds to generate passive income from investments (e.g., dividends from stocks, yield from borrowing and lending, or staking reward from Ethereum and other Blockchains).
Become Python freelancer now! ?
While working as a researcher in distributed systems, Dr. Christian Mayer found his love for teaching computer science students.
To help students reach higher levels of Python success, he founded the programming education website Finxter.com that has taught exponential skills to millions of coders worldwide. He’s the author of the best-selling programming books Python One-Liners (NoStarch 2020), The Art of Clean Code (NoStarch 2022), and The Book of Dash (NoStarch 2022). Chris also coauthored the Coffee Break Python series of self-published books. He’s a computer science enthusiast, freelancer, and owner of one of the top 10 largest Python blogs worldwide.
His passions are writing, reading, and coding. But his greatest passion is to serve aspiring coders through Finxter and help them to boost their skills. You can join his free email academy here.