As an entrepreneur, taking risks to earn money is part of the job. You do your due diligence, conduct the necessary research, and weigh up the risks and benefits of each movement. This applies not just to your business, but your personal finances as well. But where should you begin? Below, we’ve created a comprehensive list of where you can start your passive income portfolio.
Wise stock market trades help earn money
One of the many ways to diversify your portfolio is to invest in the stock market. The stock market can be an intimidating place to begin. An entrepreneur like yourself should be ready to tackle it head-on. Tackle it head-on as you would any other challenge in your business. Fortunately, today’s technology allows you to register with a brokerage firm online. This allows you to focus more on your business. As a result, it saves you time from physically traveling to a broker’s office.
It’s worth noting that the stock market is more of a long-term investment. Those who think of it otherwise won’t make the most of it. In fact, legendary investor Warren Buffet says that those who are in it for the short-term are better off hedging their bets in Las Vegas
, as investing is a long game that requires 10, 20, and sometimes even 30 years of strategic commitment.
Wise forex trading helps earn money
Forex trading is growing in popularity, with FXCM reporting that the average daily trading volume exceeds $5 trillion
. This popularity is due to forex markets being open 24 hours a day, five days a week. And just like stock trading, it can be done online. This option is better for those who have time management issues for managing their business. They may to do this as a side project. However, like all investments, it requires a significant amount of research. This is particularly true when it comes to geopolitical events directly affecting currency fluctuations.
Peer-to-peer lending helps earn dividends
For many years, banks have been, for the most part, in charge of facilitating loan schemes between investors and borrowers. However, P2P lending platforms such as Prosper and Lending Club are turning things around. These platforms are not under burden by traditional banking, offering for higher rates of return on investment for budding solopreneurs. These include interest rates between 6% to 36%. A diversified portfolio in P2P lending can easily raise you in the double-digit rates of returns. This is true, even if you create a reasonable gap for defaults and management fees.
Using real estate for extra money income
There’s always a significant amount of money to earn from real estate. It does not matter if you’re selling your home or renting out a room on Airbnb. If you don’t have enough capital to invest in properties by yourself, consider trying out real estate crowdfunding. With Forbes anticipating a $300 billion value for real estate crowdfunding by 2025
, the ever-evolving industry continues to be a great option for side investments. Platforms such as Fundrise or Realty Mogul offer the benefits of real estate co-ownership for as little as $500.
Government or corporate bonds
Bonds are simply loans for governments or corporations that need capital. The main difference is that the average Joe can take part in lending money to these large entities through bonds. What mainly attracts solopreneurs to putting money into bonds is the fact that their risk of default is significantly low. The life or maturity of bonds, however, can vary greatly — anywhere between 1 to 25 years. There is also an option for short-term maturity. These are known as treasury bills or T-bills that usually mature in varying terms between 30 days and one year.
Investing with little to no capital
Most of the suggestions made above require money. However, it’s worth noting that there are several ways to create passive income without significant capital. This includes offering teaching services or even publishing a book or guide on skills that you’ve mastered over the years. The challenge therein lies in spreading the word about your business, and social media platforms like Instagram and Facebook are your best bet
However, don’t expect that you won’t have to do any work. Even with the right channel, you still have to stay connected to your target market. This means consistent communications with engaging content to grow your business. When people are always looking to the web for practical information, put your time and effort into teaching and/or publishing. This could result in additional income as a result.
Remember that investing shouldn’t be tackled like a hobby. Just like your main business, any investment entails time and effort before you can ensure significant returns. Stay determined and you’ll soon find yourself receiving extra money on the side for both your retirement and spending pleasure.