As the year comes to a close and holiday madness begins to set in, I’ve noticed more and more people complaining that they don’t have enough time to focus on what they love. That the everyday pressures of their freelance lifestyles are starting to overwhelm them. That they wish there was another option.
If you’re one of those people, you’re lucky you landed here. There is another option: passive income.
Passive income is exactly what it sounds like — it’s income that’s passive. Or, to put it another way, it’s income you earn from work/activities you don’t perform regularly, or don’t exert much effort on.
Sound like a fantasy? It’s not. It’s the real life. (Yes, that was a vague reference to Queen, but it’s also the truth).
Of course, I can understand your skepticism. Passive income and freelancing don’t seem like they’d go together at all. As freelancers, we’re bound by the cold hard fact that if we don’t work, we don’t get paid. Any day off is a day without income. And so on.
So how can we even begin to dream of earning a fantastic living while not working? By getting just a little creative…
How I Earned $3,000+ in One Month Via Passive Income
Around this time last year, I made it a goal to start making money via passive income. I, like you, longed to work less while earning more.
I released an information product — a PDF guidebook entitled Successful Freelance Writing Online: How to Generate a Full Time Income by Writing for Blogs. With it, I included a couple of checklists, a few interviews with successful freelancers, useful articles, and a secondary guide on finding paid blogging work.
I created a product that I knew (or hoped, at least!) my audience would love. And they did! Within mere weeks, I’d surpassed my passive income earnings goal for the product for the entire year. And, you know what? This product is still making sales over a year later. In fact, I just recently launched a hugely updated version of the guide called Paid to Blog, which paid back the investment I made into it in one day.
Yes, I could have made money through affiliate marketing, or even pay-per-click advertising, but I chose to go a different route. The route that I firmly believe has the highest ROI.
With affiliate marketing and ads, your success is largely dependent on high traffic flow. Quantity over quality. However, when creating an information product, you don’t need heavy traffic flow to your website — a few loyal visitors can still rake in enough money to make your efforts worthwhile.
And this is coming from a guy whose first foray into earning passive income was heavily steeped in fear and uncertainty! Just by reading this, you have more knowledge in this area than I did when I actually went out and did it. (I’m a dive in head first kind of guy, what can I say?)
I didn’t know if anyone would like my product — which, thankfully, motivated me to create an even better product than I might have otherwise. But, even then, I wasn’t sure if I would be taken seriously as an “expert” in my field.
But you know what? Even if you don’t know everything, you still know more than someone. So long as you know more about the subject you’re talking about than your audience does, you’re “expert enough.” You have absolutely no good reason not to start earning passive income through an informational product.
How You Can Start Earning Passive Income Using Your Skillset
I chose to create an e-book on becoming a successful freelance blogger because it’s an area that I have succeeded in and know a lot about. It’s that old adage taking effect: “write what you know.” I chose a topic I was familiar with, that I knew my audience was interested in, and I ran with it.
You might earn your passive income in a different way:
- Selling stock graphics. Whether you choose to sell these to a marketplace or create your own webstore, the possibilities are nearly endless: photos, icon sets, homemade fonts, or logo templates. You could also create Photoshop brushes or filters.
- Anything WordPress. My site runs on WordPress. This site runs on WordPress. There’s a good chance your site runs on WordPress! You see where I’m going with this? WordPress is a hot commodity right now and the passive income opportunities are ripe for the plucking. If you have the skills to create them, there’s good money to be made with WordPress themes and plugins.
- Sell knowledge you’ve acquired from others. Earlier this year, Bronson Taylor hit the entrepreneurial scene hard with Growth Hacker TV, a website/business dedicated to helping new entrepreneurs create successful startup businesses. The basis behind this successful enterprise? Video interviews from other successful startup owners, accessible to paying members only. (I also had success including interviews from fellow freelancers with my own product!).
- Teach a class. This option is probably the most work…at first. Coming up with a class outline — what you’ll be teaching each week and to whom — can be extremely time-consuming and a little daunting. However, once you get all of the initial work out of the way, each class that follows becomes increasingly easier. The worksheets and modules you painstakingly crafted for the first round can be recycled for each preceding school year, provided the material you came up with is still relevant/evergreen.
- Write an e-book. This one isn’t just for freelance writers! Freelance SEO consultants can create SEO guides, freelance designers can share basic design tips, and freelance developers can share the finer points of UX. No matter what your particular skills are, I can guarantee you that someone out there wants to read about them. E-books are pretty much the information product, in my opinion. No matter what field you’re in, I’d urge you to give them a try. (Note: If you’re not the strongest writer, you can still get your knowledge out into the world via a tight-lipped ghostwriter).
- Memberships, communities, and forums. If you’re confident that you’ll be able to provide your audience with a constant stream of worthwhile information and products, setting up a pay-for-admittance community may be the way to go. You can provide fellow freelancers with job leads, or hand out “members only” downloadables and exclusive content, or simply make sure there’s always someone around to offer great advice (at first this person will be you, but as the money starts to roll in, you’ll be able to hire moderators and assistants).
The method you choose will largely depend on your personal business interests, available time, overall business plan, and your customers’ unique needs. First: focus on you. Because, while setting up a passive income stream will mean less work for you in the long run, creating that initial product/service will cause additional work for you in the present.
Before you start, you’ll need to calculate three things:
- How long will the product/service take to create?
- How much of an initial investment is needed?
- How much would you like to earn, per hour, in return profits?
For instance, when I created my e-book, I estimated that it would take approximately 50 hours of my time, around $500 to create (designers, etc.), and I wanted to earn at least $50/hour in profits. From there, I was able to calculate that the minimum profit I’d need to make on the life of my product was $3,000. [( 50 * 50 ) + 500 = $3,000].
Fortunately for me, I exceeded that mark within the first few weeks! However, I was willing to wait to make that amount over the course of a full year. Because earning passive income can take time, even if you do everything right. And it will be up to you to calculate how much you’ll need to earn to make it worth your while.
Don’t Be Afraid to Adapt
As your customer base grows and changes, your product/service may need to change as well. Listen to the needs of your audience. That’s what led me to release Paid to Blog — I recognized that I could do more for my audience. That is reflected by the fact that the uptake on upgrades to the new course have been healthy.
You may find yourself making similar adjustments.
At the very least, you’ll need to make the occasional tweak to your product or service to make sure it’s up-to-date. WordPress plugins and themes will need to conform to the latest software updates. SEO e-books will need to address any new changes in Google’s algorithms. Video interview series will have to be re-shot to include new stars with newer, better techniques.
In other words: enjoy the luxury of your passive income…just don’t get too passive about earning it. Always keep one ear to the ground and listen to what your customers are saying. Adapt as needed. Good luck!
Image by 7rains.