As fun as working as a digital nomad is, it never hurts to have some extra money on the side! Earning passive income is a dream for most people, and it’s not as hard as you’d think to get started! These passive income strategies won’t add up to a normal salary you’d need to live day-to-day, but they will definitely help you pocket some extra cash!
Passive Income by sharing your computer bandwidth
This is probably the easiest way to earn passive income while doing nothing. There are several online services that will pay you to rent out your unused computer bandwidth. All you need is a decent internet connection and a computer. You can get paid $20-$100 per month for every computer you use, limited to one IP address. Use one of the below websites to download the node/application required, and whenever your computer is idle, you will get paid; it’s as easy as that! If you want to really ramp this up, you could consider purchasing another internet router and computer if you already have one handy (not recommended if need to purchase extra computers).
Buy property for Passive Income
Consider buying a home or apartment in a country where the prices are super cheap. I don’t recommend places like the United States or Canada because of the expensive prices and taxes; if you’re unable to rent the property for a long period of time, you’ll take a huge hit in taxes, possibly making you break-even from any previous profits. Owning real estate (not renting) is a smart and generally safe way to invest your money, as you secure an asset that generally increases in value and allows you to rent it out and generate passive income! Just remember, there are always different rules foreigners are subject to for each country when it comes to purchasing property, so do your homework before investing. See below for some of the cheapest prices in several cities/countries:
- Brazil – houses for $50,000
- Mexico – houses for $30,000
- Italy – the island of Sardinia has properties available for $1 (but $25,000 USD of renovations required)
- Cambodia – houses for $20,000
More specific information can be found here: https://instablogs.com/10-cheapest-countries-to-buy-property-in-2019.html
If you don’t have enough to fully invest in a house or apartment, check out Fundrise. This company allows you to purchase pieces of property instead of the whole thing, and all you need is a minimum of $1000 to start! The catch is that you don’t have a choice of the locations and types of properties you invest in; they will manage and invest for you. They have a good track record in general but just be aware that you may not get the ideal location of property of choice! You won’t get to rent out or fully own any property, but it’s a new and easy way to get into real estate with a few clicks of a button!
Follow this link to check it out: https://fundrise.com/
Invest in cryptocurrencies and the stock market
Cryptocurrencies, over time, have proven to provide pretty strong returns. Although this is not a guarantee, it can be a smart way to diversify your assets into a new and emerging asset class! My thoughts and advice on this can be found in my previous article here.
The stock market is where most people hold a majority of their assets, in their own personal portfolios or 401(k)s, Roth IRAs, etc. Stocks are considered less volatile than cryptocurrency, so if you’re more risk-averse, this is probably a better option for you. Here are some great apps & websites to get started:
- Robinhood – an app that lets you buy stocks and cryptocurrency for FREE
- Wealthfront – has a low-fee robot that will automatically manage your 401(k) or Roth IRA; just sit back and relax while it adjusts your investments according to market conditions
- Betterment – another low-fee robot that will automatically manage your retirement accounts
- Coinbase – aside from letting you trade cryptocurrency, coinbase also has a learn to earn program that gives you free Crypto for watching videos
My recommendation on investing in the stock market is to generally play it safe with low-risk ETFs and index funds. You can also look into large and mid-cap companies, and maybe throw in a few small-cap companies to add a little bit of risk to your portfolio. I would recommend 50% large cap, 35% mid-cap, and 15% small-cap stocks for a well-balanced portfolio. Here are some index funds and stocks that are generally stable and have provided solid, steady returns over time:
- VB (Vanguard small-cap ETF)
- VO and VOT (Vanguard mid-cap ETFs)
- VUG and VTI (Vanguard large-cap ETFs)
- AMZN (Amazon)
- APPL (Apple)
- XLK (Technology Select Sector SPDR Fund)
- SPY (SPDR S&P 500 ETF)
- ADBE (Adobe)
Passive Income by opening a high-interest savings account
Savings accounts these days pay almost no interest at all; sometimes you wonder what the point is of even holding your money in the bank. If you’re lucky enough to live in the United States, there are a few competing banks that offer above a 2% interest rate on your money, which is over 100 times the national average. Although it’s not anywhere near getting the big bucks, if you don’t want to risk any of your hard earned cash, you can just stick it in one of these accounts so it can at least be earning something! The below bank accounts are FREE and require no minimums to keep the account open:
- Wealthfront – 2.57% APY
- Marcus by Goldman Sachs – 2.15% APY
- American Express – 2.10% APY
- Barclays – 2.10% APY
If you have money saved up, make it work for you! Most methods of earning passive income rely heavily on investing, but as mentioned above, there are some clever and simple ways to earn a few extra dollars a month! Having bits of diversification in each can also be helpful if you don’t know where to start!
So what are you waiting for? Use these tips and get started to find out which passive income sources are right for you!
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In his spare time, Tristan works in the project management space and passionately trades cryptocurrency. Ask him anything about Bitcoin and some of the lesser-known cryptos and he’ll talk your head off 🤣. He’s also a huge sports fan and athlete, playing tennis, soccer, basketball, and as if that weren’t enough, he swims and cycles from time to time.