The *current* passive income definition is:
Income that you earn without having to make a substantial, daily effort.
Passive income takes upfront work to build. It takes time and effort to create passive income as a revenue stream, but once you do – you’ll earn money without having to work for it.
Sounds too good to be true, right?
Let’s take a look at a couple examples of popular ways to earn passive income online:

2 Examples to Explain the Passive Income Definition + Why The Examples Work
Example #1: Digital Products – eBook
If you create a digital product, such as an ebook, it takes work upfront. You’ll have to write the book and create a place to sell it online.
BUT once you’ve done that initial work, you have a product that can live forever online and make sales 24/7.
Most passive income isn’t 100% passive, it usually takes some effort to maintain. In this case — unless your book is an instant hit — you’ll spend a time marketing it.
Example #2: Blogging with Affiliate Links
Another popular example of passive income is blogging using affiliate links. Affiliate links are:
Affiliate link: links that you add to a blog post that link to a product or company. If someone clicks your links and makes a purchase, you receive a commission.
Affiliate links are a great form of passive income because you can add them to your blog once and they’ll earn income forever.
For more about how affiliate marketing work, check out:
How to Make Your First $100 with Affiliate Marketing
Why You Should Build Passive Income, Even If You Start Small
The BEST benefit of passive income is that it frees up your time for other activities: more fulfilling work, travel, spending time with family, etc.
It’s also income that you can earn for years to come. Even though you’ll spend some time setting it up, once you do you’ll have new long-term revenue.
If even a small part of you is interested in the benefits of passive income, go for it! Because the sooner you start your passive income project, the sooner you’ll see rewards and the more income you’ll make long term.
Start now because it will take time to build passive income. More on how to get started below.
Before we talk about exactly how to create passive income, we need to debunk a few common myths.
3 Very Wrong Common Myths About Passive Income
Myth #1: It’s a Get Rich Quick Scheme
False. Passive Income is rarely quick. It takes time to build and establish. You work hard to create passive income streams knowing that the payoff will be long-term + low-maintenance income.
If you have someone promising you thousands of dollars in a quick passive income strategy, run!! There are lots of valuable strategies on the internet for passive income, but the best one’s aren’t the quickest!
Myth#2: You Can’t Make Real Money
False. You can make real money. A lot of it. It’s possible to build passive income that gives you financial freedom to: quit your job, travel the world, build a six-figure business, etc. Creating substantial passive income takes strategy, time, and expertise. But it can be done, and those that do it start exactly where you are today – by learning the first steps 🙂
For some inspiring stories of what passive income businesses can look like, check out:
The Smart Passive Income Podcast
Myth #3: Passive Income Takes No Work to Maintain
In the passive income definition are the words:
‘…Without having to make substantial, daily effort.’
This means that passive income does take some effort to maintain. You can’t completely forget about it. But compared to other types of work, it takes minimal effort to maintain.
How to Get Started Making Passive Income:
There’s a few ways that you can get started making passive income. For the purposes of this article, we’re going to focus on online ways to build passive income.
Specifically: starting an online business.
Here’s 6 ways to create passive income as part of your online business:
- Blog with affiliate links
- Digital products: eBooks, online courses
- Selling digital products on Etsy: photo presets, templates, etc.
- Ad revenue
- Ecommerce store using dropshipping
- YouTube channel
For more information on how to start each of these as an online business, and the steps to take to incorporate passive income:
Download the FREE Beginner’s Guide to Starting an Online Business
Leave a Reply